Doesn’t make a lot of sense. Generic insulin’s are already being made. Why not just buy those?
"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.
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'm guessing it will be generic and the high speed rail will be used to deliver it.
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.)
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.
I don't understand the point you're trying to make.