Governor Newsom announces California will make its own insulin
kion546.com
kion546.com
https://esd.dof.ca.gov/Documents/bcp/2223/FY2223_ORG4140_BCP...
"This proposal will use $50 million in funding to enter into a partnership with a contract manufacturer to develop and bring to market interchangeable biosimilar insulin products in both vial and pen form."
"This proposal also includes an additional $50 million for the construction of an insulin manufacturing facility based in California. CalHHS will partner with the Governor’s Office of Business and Economic Development (GO-Biz), leveraging its expertise in business investment services such as site review, permit assistance, and other related activities. CalHHS will lean on GO-Biz’s expertise to mitigate risk and properly execute the proposed manufacturing facility, if CalRx proceeds with this component of the project."
California can't even build high speed rail with a budget in 10s of billions of dollars and more than a decade of time.
High speed rail involve lots more private land use and local regulations.
Probably wishful thinking but would be great.
And I say that as someone who left California for the northeast.
Whatever glory Cali has— tech, entertainment, farming, weather, natural beauty— is in spite of govt rather than because of it.
I assume you are referring to property taxes, but undoubtedly any “dynastic” family is going to have more tax liability from income than from property value.
https://www.statista.com/statistics/294941/largest-ratio-mil...
And that’s why rich people love living in blue states like California.
That drives real estate values higher, and creates a big tax divide between owners and renters.
That is, what evidence do you have that the success is in spite of government? Is there a comparable government or system that is doing better? Why? Or why not?
Despite adding an additional 1.0% tax to fund mental health, homelessness has only increased in California. Efforts to reduce prop 13 inflated property values are feeble at best. Senior and junior water rights, where senior land holders can extract as much water as they want over juniors, based on an arbitrary date chosen in law, have not been reformed. CalPers is very poorly funded compared to other states.
Don't get me wrong, a lot of California's success is due to government. Banning non-competes and funding a strong system of community colleges and state universities for example. But other states are 'kinda' adopting non-compete bans and the state has cut funding years ago to those institutions, which makes me question the value of my tax dollars when a house built just after WW2 costs over a million dollars, K-12 is below the national average, and the public universities here cost much more than well regarded ones in other states. The state is not dealing with it's problems.
I left a while ago and I feel better for it.
Edit: grammar and a few words.
And, most of the bad things you are bringing up are happening all throughout the US. Just feels too convenient to say that the tech industry is in spite of the government, but the failures are because of it.
You asked for an example of another government doing better. I gave you a recent one by California's government. Japan is perhaps the best one, but many other countries do trains a lot better than California despite all the hype and money they put in it's mediocre result. It was a very open question that your follow up questions are trying to pivot to something else.
> And, most of the bad things you are bringing up are happening all throughout the US.
Please read my post again. Being below average in K-12 among the states, despite the high taxes and land values, is not happening all throughout the US.
> Just feels too convenient to say that the tech industry is in spite of the government, but the failures are because of it.
Please read what I wrote carefully above, I did not agree with that fully. My argument was more of the recent CA govt has not been addressing it's problems and the tech industry's success was due to good decisions in the past (and the weather). The recent CA govt actions has been poor. Calling the recent tech boom in spite of government policies is something I can somewhat agree with.
Think of it as me asking if a tennis player is training well. You want to compare to other tennis players, not cyclists.
You may be able to get some cross learning, of course. But I'm specifically questioning if California's successes are in spite of government. Not if their failures are because of it. These are two questions and it is not clear to me that they would have the same answer.
California also gets a lot wrong that interferes with tech: prop 13 and friends, housing policy, incredible corruption, massive local conservatism
But California is most like America as a microcosm: horrifically corrupt but such a powerhouse that it resembles a leviathan that charges despite the parasites on its back and belly.
Indeed, it is literally “incredible”. What passes for corruption in California wouldn’t even be worth noticing on the older states of the east coast, especially the north east. I’ve lived in both.
Like i said before, this is wishful thinking, but it’s not for lack of resources.
The US weirdly in general has a lot of high ranking universities, but its elementary and secondary schools are very very uneven, at any level.
OTOH, just a few miles from some of the best public schools in the country you can also find some of the worst. While California is segregated, most Californians nonetheless live in relative close proximity to people living in vastly different circumstances, so disparities are very evident.
Let that sink in.
https://www.usnews.com/education/best-high-schools/georgia/d...
https://www.usnews.com/education/best-high-schools/californi...
Ok, so right here is the issue. It's like saying that US has no poverty issue, because some of the richest people live here. You yourself mentioned, that it is important to improve the bottom percentiles. And the bottom percentiles in California are not good. Some of the exceptional schools in CA are private, some of them are public, but most likely located in expensive areas. You gonna have to pay for a good school either directly or via insane home prices. Yes, you can find decent schools in less-crowded-but-not-very-rural areas with more reasonable cost of living, sort of a sweet spot. And the majority of those schools aren't gonna be exceptional, the will be fine, just fine. Not better than any other state. But the lowest percentile in the worst area is still gonna drag the whole chart down. Everyone I know in CA who cares about school for their kids either lives in a pricy area or pays for a private school.
As for Lowell, I think that was a big issue for many, but not amongst the 100+ parents that I’ve spoken to on the issue.
https://wallethub.com/edu/e/states-with-the-best-schools/533...
Ranked 42nd overall, 36th in quality and 51st, ie last in safety.
Of course things could be better, and like a previous commenter mentioned, there are missing investments in housing, transportation and more. That is however, because of the continuous specter of the right winning state offices and the "left" party basically being centerist.
Cognitive dissonance, just like the fact that all of the red states have way higher gun deaths per capita than any blue state yet they'll scream about Chicago without looking at the actual numbers
That's not cognitive dissonance, just different definitions. Red staters focus on total homicides. Age-adjusted homicide rates don't bear any clear pattern with red states versus blue states: https://www.cdc.gov/nchs/pressroom/sosmap/homicide_mortality.... https://worldpopulationreview.com/state-rankings/gun-ownersh...
Some of the states with the highest levels of gun ownership, like Oregon, Idaho, Utah, Minnesota, and Maine, have the lowest levels of homicides. Rhode Island has far fewer guns than Maine and New Hampshire, but all three have similar homicide rates.
It’s not as big as California, but has had substantial growth.
Georgia is similar.
[0] https://fcit.usf.edu/florida/docs/c/census/1970.htm [1] https://www.census.gov/quickfacts/FL
Lol, and now you edited it out. Case in point.
I believe the greatest risk to California’s continued prosperity is the lack of affordable housing (which I would associate partly with Prop 13, but also just general NIMBYism). There have been a lot of efforts in the past few years to move towards higher density but I think we’ll need to wait until the next administration to see if this pro-housing approach is going to stick.
Alexander Hamilton. On california of course
- One of the best ways to match models to reality is to see if they have predictive power, for some time now people have predicted that California is doomed, see, “California doom: Staggering $54 billion deficit looms,” https://apnews.com/article/48a9ce5ad7494d22ec0c42ac46ae9baf , but the surplus that year was a $75 B.
- Since 2006, California has cut the rate maternal mortality and women dying in childbirth by 65%, the national maternal mortality rate has increased by 50% to 70%. The impact this one data point has on people's lives cannot be overstated. More women are dying in the States at a rate 6x that of Nordic states and 3x that of Canada, and it's a trend that's increasing for most of the US. Except California. This data is from 2018, but the graph is simply staggering, https://www.npr.org/news/graphics/2017/05/propublica-mortali... and https://cdn.cnn.com/cnnnext/dam/assets/220510134152-hponly20...
- Despite the reduction due to the pandemic, California has the longest lifespan in the US for men. If you are born in California, as a man, you will live to 78.4 years on average as compared to 71.7 years (and falling) in West Virginia, 76 years in Texas, 72.6 years in Kentucky, and 75.7 years in Texas.
On average, you will live 6+ to 3+ years longer than most US States if you're born in California. The same is true for women. Data, https://www.cdc.gov/nchs/data/nvsr/nvsr70/nvsr70-1-508.pdf
This is roughly the same amount you would get from an intervention such as lifelong/prolonged caloric restriction, https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3014770/
- Between 2015 and 2019, California's economy grew at a rate of 22%. For comparison, China was 26%. Germany, 15%. Japan, 16%. In December of 2021, California added 42% of all jobs in the US. Nearly half of all new jobs in the country for that month were created in California. Alone. https://mehabe.com/2021/06/14/among-the-five-largest-economi... | https://www.gov.ca.gov/2022/03/11/californias-economic-recov...
- California has the highest rate of income growth in all of the US. Even when compared to Texas. Here's a comparison of the two states,
Despite a slight decline in population, California's per capita income grew at a significantly greater rate than Texas,
"Between 2000 and 2020, California’s PCI was significantly greater than both Texas and the U.S. as a whole (BEA, 2021). Both disparities grew substantially from 2015 to 2020. For example, while California’s per capita income was 20 percent higher than Texas’ in 2015, this gap surged to 30 percent just 5 years later. And this was not simply a COVID-induced phenomenon, as the rising disparity was apparent in 2019 even before the pandemic."
Between the two states, the government invests substantially more on the public in California, even when adjusting for state revenue,
"A large part of this difference between California and Texas, however, is driven by differences between the two states in GDP per capita, which is 22 percent higher in California ($79,405) than in Texas ($65,077) (BEA, 2020). Even adjusting for this, state and local governments loom much larger in California, with their spending representing 20.3 percent of the state’s GDP versus just 15.4 percent in Texas. By this metric California’s public sector is about one-third larger than in Texas, implying that the greater per capita GDP in California explains almost half of its higher state and local spending."
From the data the study concludes that this spending leads to, "it appears higher government spending in California leads to stronger student performance, better environmental and health outcomes, and safer neighborhoods than in a small government state such as Texas"
Full study, https://siepr.stanford.edu/publications/policy-brief/tale-tw...
- We can contrast California against states like Kansas, where they've implemented low taxes and cut public spending as a part of the "Kansas Experiment", the state has gone almost bankrupt and there has been no subsequent increase in GDP growth. The experiment is widely regarded as a failure. https://en.wikipedia.org/wiki/Kansas_experiment
There are areas where California doesn't do well, such as homelessness, but by every conceivably metric, California has exceeded other US states. Surely some of this has to do with governance.
If I was to sum up my position here, it's this. You get what you pay for.
A single doctor at a single hospital developed this theory and then tested it. There is a foundation which is partly funded by the state, but they just promulgate the ideas... it's up to the hospitals to do the mortality review and apply what they've learned there. There's really no fingerprint of recent government efficiency to be found here.
What connection is there between government efficiency and life span of citizens? This is a minefield of variables.
Aren't minimum wages significantly different between California and Texas? Wasn't this phased in around that time? How much of this increase is due to this?
We can contrast California to states like Idaho, which spend 2/3 of what California spends per student and yet gets far better outcomes than California does. California has the lowest rate of education attainment out of any state in the country.
The infrastructure is crumbling. New projects are consumed by consultant driven graft. Sacramento is generally paralyzed by special interests. The complete lack of action on homelessness is tragic for the absolute volume of human life just discarded on the side of the road. Gas prices are absolutely ridiculous and the state is hoarding tax dollars during grotesque inflation.
8 years ago.. I would have agreed, California may have been a little shabby, but it was still on a great track. Today I have far less faith in the state, particularly considering the Governor appears to be desirous of a presidential campaign and the state is about to be used as a prop in his endeavors.
> A single doctor at a single hospital developed this theory and then tested it. There is a foundation which is partly funded by the state, but they just promulgate the ideas... it's up to the hospitals to do the mortality review and apply what they've learned there. There's really no fingerprint of recent government efficiency to be found here.
I don't understand. Can you please provide citations for what you're trying to say?
> CMQCC was founded in 2006 at Stanford University School of Medicine together with the State of California in response to rising maternal mortality and morbidity rates. Since CMQCC’s inception, California has seen maternal mortality decline by 65 percent between 2006 to 2016, while the national maternal mortality rate continued to rise.
https://www.cmqcc.org/who-we-are
If you read through the links, you'll see that the Californian Government has made substantial investments in maternal mortality and perinatal care which has resulted in this staggering decline. The resources of the state were mobilized with the help of the best evidence backed medicine to save lives. That's a great outcome!
> What connection is there between government efficiency and life span of citizens? This is a minefield of variables.
It's not about efficiency as much as it is about policy. No large organization is efficient; rather they ought to be measured by their effectiveness.
Investment in hospitals, clinics and public health. Reductions in environmental emissions (air pollution dramatically reduces lifespans). Expansion of coverage programs like medicaid via systems like medi-cal; https://www.medi-cal.ca.gov/ Ensuring access to clean drinking water, adequate sanitation - https://www.npr.org/sections/health-shots/2020/11/23/9379451... . Preventing dumping of toxic waste. Public vaccination programs. And the many, many other levers governments can pull to ensure that people live longer and are healthier.
> Aren't minimum wages significantly different between California and Texas? Wasn't this phased in around that time? How much of this increase is due to this?
In the comment, the study compares California and Texas between 2000 to 2020.
I am not a specialist on the rest, and do not have the data on hand, but just a note, American infrastructure is crumbling in general due to a receding of the state from infrastructure investments.
Could you please provide a citation and explanation for your Idaho comment?
Reddit user lists all the reasons why California policies lead to the best health and life expectancy outcomes in the United States: https://www.reddit.com/r/bestof/comments/up7wei/uinconvenien...
> If I was to sum up my position here, it's this. You get what you pay for.
I lived in California for years before I moved to London 3 years ago. I agree that California does a lot of things better than some states and there's an element of "you get what you pay for." But I think that doesn't let California off the hook for the value they return on the money they collect.
Between federal tax, state tax, social security and all the zany other taxes (CA SDI, etc), the tax rate you pay in California is very close to what you pay in the UK or a lot of other European countries. If you own a home, add in yearly property tax which is similar to what you'd pay in UK council tax.
But in London, you get 100% free healthcare (including all medications at a nominal fee), fantastic public transit, weekly trash/recycling pick-up from your local council, extensive council housing to actually house low-income people, etc. The same money is getting more done. I'm not claiming it's perfect or can't be improved, but the services you get for paying roughly the same tax rate are significantly higher (and the same applies in many other cities in Europe).
I think a lot of people in the US don't realize that CA taxes are essentially at the same level as many countries in Europe. So I have at least a little sympathy for people who throw their hands up and move to a low tax, low service state like Texas when they feel like they aren't getting a European level of services for a European level of taxes.
I think some of the inefficiency in California stems from the proposition system where large pots of money are allocated to seemingly good causes but it ties the hands of government who are trying to manage the overall budget efficiently. The amount of propositions included in every voting cycle is comical and in my opinion it is just shifting the work of detailed governance onto the general public who has neither the time nor the expertise to decide on a lot of the issues presented at the level of detail required.
It's also why your taxes are so high with nothing to show for them. Turns out austerity is expensive for most people. Canada and Mexico have cheap insulin because their governments are only willing to put up with so much profiteering in medicine. One has to ask why the US government is. Is that because of the far left, too?
Hearing people describe Democrats as far left makes them sound like clowns spouting canned propaganda. It's not conducive to conversation as you know you aren't talking to a rational person who can argue in good faith.
Either that or they hang out on 4chan
Isn't this true of most Americans democrat or otherwise.
Rural communities need broadband internet access and we need to work to reduce the amount and impact of echo chambers on the internet
"Black Lives Matter but not if they have to build housing next to me" is a California meme.
See also Prop 13, a tax revolt, being the crux of a lot of California issues.
While government services can certainly be more efficient and cost disease is rampant, we first have to agree that the government should be providing the service in the first place (which we don't, countrywide)
SF spends more on homelessness than any other municipality, but still has rampant homelessness.
SF’s muni is one of the worst in the country in terms of reliability and speed but we have a muni budget that is equal to London per capita.
Most complaints in California isn’t on its ideology, but rather its incompetence at executing its ideology
It seems to me that California does both more economic redistribution via higher taxes and is more open in terms of accepting a wide variety of foreign immigrants, cultures and religions.
ftfy
There is some leftists in the US, i found them. Old hippies or young actives doing a lot of hiking/rock climbing/kayaking and playing music. They mostly don't engage in the two-party politics.
The last time a Republican had any presence in California was 30 years ago and the Dems have driven this state off a cliff. Why do Californians still keep falling for the same grift election after election? It doesn't matter who you vote for, all they do is steal from the people for their own gain and we keep voting for them because they give us lip service on particular causes.
What Prop 13 does is stop retired families from being forced to move out. The retired families in my neighborhood would have to pay $4000+/month in property tax. What will it be in 2030 or 2040? The only thing keeping things sane are things like Prop 13.
And don't forget, Pelosi, in all her glory, was trying to add back in the SALT tax exceptions to the Biden bills earlier this year. Why would she do that except to reward all her rich donors in CA?
Nothing would change except homeowners would get crushed by property taxes and especially given the horrific income inequality in California, all the middle and lower income families would get destroyed.
Thank God for Prop 13, it's the last vestige of income equality for Californians.
That's why almost 12% of the US population chooses to live in California right?
This action might be rational actually given lack of federal regulation on healthcare, but they could just as well handle it another way, and more comprehensively (i.e. price controls, pricing transparency - yes, it's hard).
There is no obvious path forward.
I kind of think Vermont has a lot of it sorted but that's also a cultural issue, I mean, Los Angeles and Vermont might as well be on different continents.
i don't suppose you're familiar with what a dystopian nightmare the housing market is?
Regardless, the cost of living is the cost of living.
Most of these are uncomplicated policy problems, yet solutions seem out of reach. Do you think CA would establish property rights to get housing? Or repeal prop 13 to reduce penalties for the young in favor of the old? Or get rid of CEQA to let folks build infrastructure? Or reform the CPUC so that energy markets are more competitive and reliable? Not going to happen.
https://twitter.com/oboylemm/status/1541472199235710976?t=bD...
Regardless of what you think about how to manage going forward, it's hard to argue that current policies are working well. PG&E sells electricity to residential customers in Northern California at approximately 3x the national average price. By comparison, if you're in Oregon (right next door with similar climate, resources, and topography) your power is typically right around (or even slightly cheaper) than the national average. And it's less likely to go out in windy weather. As far as I can tell, PG&E is precisely the company you would expect to get out of the regulatory environment in which it operates (e.g., you guarantee fixed margin on opex and a larger fixed margin on capex, obviously the power company is driven to maximize costs and minimize maintenance). So I blame the regulators more than PG&E.
Somehow they've figured it out.
I can provide no insight as to 'how' but I suggest some reasonable regulation has something to do with it.
as with every build-vs-buy problem, you don't know if you'll actually be able to do it until you do it. I'm wondering what a state government has ever done that is as complex as manufacturing a medicine -- maybe road building / big water projects?
if they succeed it would be a new chapter in state capacity + really exciting, especially if they are transparent about accounting and show that they're not warping the market
I think biohacker group open insulin https://openinsulin.org/ was founded in oakland -- they're working on lispro, the fast-acting kind in humalog
the humalog plant in puerto rico cost 200-500 million dollars in the early 2000s [1]. there are 3+ million californians w/ diabetes (per diabetes.org), and it costs north of $5k per year per person, so that's like 15 billion. you don't have to dent that # much to get ROI on this.
1. https://www.pharmaceutical-technology.com/projects/eli_lilly...
Arguably the whole point of this is to warp the market by picking the winner and giving them all the business in the state.
Though, chances are this will just turn into a taxpayer subsidized boondoggle like every other time the politicians pick the winner.
As long as they're not forcing people to buy their insulin then what they're doing is more akin to setting a price floor (assuming they are selling at cost rather than subsidizing a loss).
But hey if it's going to be a boondoggle then the private sector should have nothing to fear from competition here, right?
There is a product that can be made for $1 that is being sold for $100. They are going to make it and sell it for $2 and you can chose to buy it from their "startup" calinsulin inc for $2 or pay megacorp inc $100 for their one.
Shockingly megacrop inc. are crying that it is socialism to make only $1 and that noble capitalists like them are doing it right and making $99.
What would be even better to know is what people are paying. It is well known that the AWP or average retail price in this case is not close to average price paid.
>> October 12, 2020 - Insulin prices are more than eight times higher in the US than in 32 comparable, high-income nations combined, according to a new RAND Corporation study.
>> In 2018, the average insulin prices in the US was $98.70, compared to $6.94 in Australia, $12.00 in Canada, and $7.52 in the UK.
US Compared to Similar Nations: https://pharmanewsintel.com/news/insulin-prices-8x-higher-in...
Budget Request Summary
HCAI requests one-time $100 million General Fund, available until 2025-26, for the CalRx Biosimilar Insulin initiative. Through a contract partnership, the State would invest $50 million towards the development of low-cost biosimilar insulin products, an additional $50 million towards a California-based insulin manufacturing facility. HCAI also requests $2.8 million General Fund, over four years, for state operations to fulfill requirements of the partnership, including monitoring, oversight, and legal compliance. The insulin products are expected to be widely available to Californians, through a variety of outlets.
https://esd.dof.ca.gov/Documents/bcp/2223/FY2223_ORG4140_BCP...
My understanding (maybe wrong) is that for private drug manufacturers, the risk of lawsuits provides a strong incentive for safe, effective products.
Would a California-run facility have similar incentives?
Drug safety regulation is federal. It's a federal agency of the Department of Health and Human Services.
It's not an area I know well, but I am not aware of a similar grant if immunity for medication in general.
Now, if you closed the loop and used older insulins, you'd have good control and less issues since a computer would bear the cognitive load, but glucose control, especially in the outpatient setting, is ridiculously hard. If you think you can solve it though, give it a shot. It's a multi billion dollar market and a lot of lives you can improve.
Edit: Answering myself here, they do not: https://www.vorys.com/publications-2574.html
However, many patents that are issued in association with a research grant include a clause that allows the government to use the patent without charge. I have no idea if any/many insulin patents are included in such clauses.
You have to avoid the intellectual property minefield on the manufacturing side. The production of insulin and its delivery mechanisms are heavily patented and the big pharma companies will shut you down if you infringe on anything. If you want a reference for this happening you can google 'lusduna'.
Plus you have to make it through the FDA, which is its own can of worms. The 505(b)(2) is still not a cakewalk but at least it will give you 3-5 years of market exclusivity so you can recoup your costs. (Wait you can get market exclusivity for a biosimilar with an expired patent? That should sound insane to anyone not in healthcare.)
Then you have to actually manufacture and distribute your product. There are extremely high capital costs to get set up. For reference, Novo Nordisk's insulin manufacturing facility in North Carolina is 328,000 sqft and staffed by ~500 people 24/7. Just to get a comparable facility up and running you're talking about 400-500 million dollars in capital cost. Sanofi, Eli Lily, and Novo Nordisk have spent billions over the last decade upgrading and maintaining their facilities.
I would suspect it's about the hardest project you could tackle if you were a startup.
I can't speak to drug manufacturing, but I know from experience that when it comes to medical devices, you save almost 10x in up front fixed cost by outsourcing, like California is doing. You spend more per unit, but still profit, so you can build a healthy warchest while you accumulate experienced personnel to build out a more vertically integrated manufacturing process.
Medical devices are frankly a lot simpler than making new drugs. (I know they are still exceptionally challenging)
Thank god it's only talking about hiring a contract manufacturer to do this.
Next, the question is, will it institute enough protections that someone doesn't take advantage of the cheap prices and sell them for profit elsewhere...
It solves a specific and practical need without being too grandiose.
In the long term, an independent, non-profit, social enterprise, government-sponsored entity would be a better vehicle for this because whichever states, federal (Medicare, Medicaid, VA), pension funds, AARP, and/or insurance companies could back it in order to reduce their costs. It's far better to pool the risks, minimize duplicated effort, and reap the rewards using scale.
This is how pharmaceuticals and healthcare should be delivered for nonelective care.
The leading US industry lobby, PhRMA, will do everything in its power to kill it in some manner whether through the legal system, traditional advertising, and/or social media.
https://truthout.org/articles/pharma-breaks-lobbying-record-...
Knowing California, all the $50 million will be spent on environmental reviews and lawsuits brought by NIMBYs.
I'm guessing it will be generic and the high speed rail will be used to deliver it.
It’s complicated
They could just have someone who is currently manufacturing the drug sell them at a discount (CA has immense buying power)? If it's not cheap enough, then further subsidize the cost.
Same outcome, less capital needed.
I don't understand the point you're trying to make.
"I am an endocrinologist working in the biopharmaceutical industry, and it surprises me that we still need to scapegoat drugs like insulin for high drug prices (“Injecting Some Insulin Reality,” Review & Outlook, April 6). Absent from the discussion is the dramatic improvements in marketed insulins over the past 25 years.
When we talk about modern insulin therapy, we aren’t talking about the old insulins. These agents required patients to carefully plan what they ate well before they did—they should rightly be cheap. Modern insulins allow patients better control of blood sugar and more flexibility. It takes large investments to develop medications. How much is it worth to not have to determine what you will put in your mouth 30 minutes prior to doing so? It is good those days are over."
— Coleman Gross, M.D. Letter to the Wall Street Journal, published there 14 April 2022.
Government should absolutely play in this space. Hell, one of the primary anti-fungal creams (NYStatin) was developed by a female researcher and state employee in the 1960s.
Easier to negotiate a big volume, then sell below cost.
No need to build a new plant.
Whether or not it works remains to be seen. But driving down the price, both for the end consumers and California state insurance providers is the goal.
California has enough diabetics on Medicaid, etc that they can make a capital investment and lock in a less steep cost curve. They don’t need to pay taxes, can borrow at lower rates, and don’t need to make money.
Big players always do stuff like this when constraints exist. Walmart, Apple, Amazon are buying up ocean and air freight assets to skip the lines, for example.
Which is why Blue Shield of California, as a major health care payer (which the State of California also is), has invested in doing the same thing (with the same nonprofit that has been discussed as the most likely contractor for the California state effort.)
This manufacturing plan may bring some short-term results, but long-term cheap tax-payer funded insulin will destroy competition and ultimately make insulin more expensive. There might also start a black market smuggling cheap CA-produced insulin outside CA.
I don't know why the CA politicians could not decide to investigate what trends caused insulin to get so expensive, and to introduce programs to make it easier for existing manufacturers to produce cheaper and for new manufacturers to enter the market.
Looking at the mess that the healthcare sector has become presents yet another example that Communist-style policies do not work well.
Regarding the corrupt and inefficient healthcare system, the solution I would have preferred would be if the government had an unlimited low-interest credit line for each citizen specifically for medical expenses. This would allow anybody to get medical treatment regardless of their financial situation, but still keep the prices low by encouraging bargain-shopping as the credit line would still have to be repaid. Payments could be deducted from paychecks depending on income just like regular taxes.
They intervened in a disfunctional market and take care of their citizens. That is what a state has to do for their citizens.