In a similar analogy: Starting up your own ISP is cheap. So why don't more people start ISPs rather than being limited to a small selection of providers?

Lobbying, start-up costs and more can all be contributing factors. Something can be exceedingly cheap to manufacture, but then you gate others from manufacturing through other fashions. Or they just outright buy out your manufacturing capabilities for pennies, then turn around to sell the insulin at massive profits again.

Patents are only one of the varieties of monopolies which apply in the field of medicine. The FDA imposes several more. Even after the patents have officially expired and you've developed your own safe & effective alternative you may not be able to get it certified because the FDA has a prior agreement with the existing manufacturers to guard their product from competition.