Pharmaceuticals maker Roche overhauled its blood glucose monitoring system and introduced a new discounting offer that it says could save uninsured diabetics by thousands of dollars per year.
The move could help alleviate political pressure as the drug industry faces mounting scrutiny over prices. It also comes amid increasing competition among blood glucose monitoring makers as diabetes rates rise.
The new system pairs a free blood glucose meter with a smartphone app and discounted test strips. With some diabetics paying as much as $2 a strip for other offerings, the new Roche system paired with a free savings card could cut costs to as little as 40 cents per strip in the first 50-count box, then 20 cents per strip in subsequent boxes.
The nation’s 29-million diabetics pay widely varying prices for testing products, in part because many of them are covered by insurance. Roches’ move is likely to provide the biggest help to the uninsured. The average American diabetic paid $1,922 in out-of-pocket expenses for care in 2013, compared to $738 for someone without the condition, according to the Health Care Cost Institute.
For “the average patient, managing diabetes and acquiring all of the testing and therapy supplies can be very difficult to navigate, really complex and very often very expensive,” said Brad Moore, head of Roche diabetes care in North America.
The new system offers a spill-resistant vial, a larger blood application area on upgraded strips and a light on the strip port for improved visibility when testing. The device wirelessly transmits data through Bluetooth technology to a free smartphone app that logs data.
Moore said Roche technicians worked on the new Accu-Chek Guide System for at least three years, including a “very significant investment in capital.”
Test strips read by devices to monitor blood glucose data are typically a significant source of profit for the pharmaceutical industry, which is under fire for its contribution to increasing health care costs. President Trump has threatened to battle drug companies over costs, while many Washington lawmakers have decried health care’s effect on the average American’s budget.
Although industry prices can be more than $2 per strip, manufacturing costs don’t typically top 15 cents, DiabeticInvestor.com analyst David Kliff told Diabetes Forecast magazine in 2012.
Roche had 8.5% market share in the blood glucose monitoring industry, trailing only Johnson & Johnson at 22.5%, according to an October 2016 report by market-research firm IBISWorld analyst Jonathan DeCarlo.
But competition is increasing, as big-box retail chains Target and Walmart and other retailers have introduced low-cost, private-label options. Consequently, the blood glucose monitoring industry’s profit as a percentage of revenue was projected to fall from 10.1% in 2015 to 9.5% in 2016, IBISWorld’s DeCarlo estimated.
Moore declined to discuss the profitability of Roche’s new test strips, which contain a new chemical makeup.
“We knew that access was a problem. We heard that from our patients,” Moore said. “So the timing was perfect in that we’ve developed a new technology platform that the Accu-Chek Guide System is based on.”
Meanwhile, drug companies are under pressure to shield patients from increasing costs, though they often blame insurers and other health care intermediaries for saddling patients with additional expenses.
With a free savings card available online, through pharmacies and at health care centers, the new Roche monitoring meter is free, the first box of 50 test strips is $19.99 and all additional boxes are $10. That’s cheaper than major competitors at Amazon, Rite Aid, Walgreens, CVS and Walmart — with the exception of the ReliOn Prime option at Walmart, according to data collected by USA TODAY.
Most options are more than $40 for a box, with some significantly more expensive. Accu-Chek’s previous box of Aviva Plus strips ranged from $44.99 at Amazon to $109.99 at Walgreens.
The average patient tests once a day but some must test eight to 10 times a day. At those rates, savings from typical diabetes tests could range from hundreds to several thousands of dollars per year.
A recent study commissioned by Roche of 500 U.S. adults living with diabetes found that 58% “cut corners” to save money in their daily testing regiment, including by skipping tests.
Source: USA Today