Naloxone is the generic form of Narcan, For people who overdose on heroin, Oxycontin, and other opioids, it has been a lifesaver. Naloxone was given FDA approval in the 1970s and has since then gone off-patent, meaning it can be made as a generic drug.
However, much like Mylar’s EpiPen, used to stop allergic reactions, pharmaceutical companies making the branded and generic versions of naloxone have taken advantage of the upsurge in opioid users and overdoses, raising the price of the life-saving drug.
In 2014, the pharmaceutical company, Kaleo, got FDA approval for the Evzio auto-injector for naloxone. It hit the market at a cost of $575, touted as a new tool in the battle to stop overdose deaths. Yet, in three short years, Evzio has exploded to $4,500 a prescription.
How the pharmaceutical companies make their money
Chances are, the friend or loved one who is given naloxone won’t have to pay for the overdose-reversal drug. That is not how Kaleo makes money. Insurance holders pay $0. If you make less than $100,000 a year, or if you pay cash for Evzio, it will cost you $360.
So, what’s the big deal? The way the system works, drug companies go for the highest price they think an insurance company will pay, and then they work out rebates and coupons for the individual insurance holders. In other words, if you have insurance that covers prescriptions, chances are naloxone will cost you $0, but your insurance company is picking up the tab at maybe, $4,500.
But the pharmaceutical companies now have another way to line their pockets – Government mandates to buy naloxone in bulk. In the last few years, state legislatures have responded to the opioid crisis by requiring first-responders to carry naloxone. This has created a new market for Kaleo and other companies making the drug.
“There was this major push to get cops access,” says Leo Beletsky, a professor of public health at Northeastern University who helped the Department of Justice write guidelines for naloxone. “Now thousands of law enforcement agencies have equipped their officers with naloxone.”
Many law enforcement agencies like the simplicity of using Kaleo’s Evzio device for injecting naloxone, so much so that they bypass other companies old-school syringe options or the nasal spray Narcan, which have bulk deals for harm reduction groups at $37.50 a dose.
“It’s kind of like a game that pharmaceutical companies play,” says Beletsky. “[Kaleo] is trying to make up as much profit as they can before they get scooped.” Bottom line? Government agencies and insurance companies are footing the bill for people who pay nothing.
