corporatocracy (noun) — a system of government in which corporations, financial institutions, or other business entities hold effective political power, either by directly controlling the state or by exerting decisive influence over the officials and institutions that do.
As of July 27, the Texas Health and Human Services Commission has been scrambling its own Medicaid drug list. Sanofi's Lantus SoloStar insulin pen is running short, and the state had to yank several previously "non-preferred" insulin products back onto the covered list just to keep patients from hitting a wall at the pharmacy counter. That's a real, live supply problem affecting real people this week. But the more interesting question isn't why Sanofi is short on pens. It's why the genuinely cheap alternative to Lantus isn't around anymore to take the pressure off.
Here's the plain version. In 2020, a company called Biocon, working with Viatris, launched Semglee, the first insulin biosimilar interchangeable with Lantus. It was priced 65% below Lantus. Same active ingredient, same effect, a fraction of the cost. It should have been an easy win for patients. It flopped badly, and on December 31, 2025, Biocon discontinued the branded pens and vials entirely. Patients who'd been on it were pushed back onto brand-name Lantus and other glargine products, right as Lantus's own pen supply started to run low. That's the collision happening in Texas right now.
So why did the cheap version disappear? Not because it was too expensive to make. The honest answer is uglier than that: the company that sets what your insurance actually covers, the pharmacy benefit manager, had no financial reason to put a cheap drug on its formulary.
Here's the mechanism, in plain terms. PBMs like CVS Caremark, Express Scripts, and Optum Rx don't make their money by finding you the cheapest drug. They make it through rebates, a cut that drug manufacturers pay back to the PBM, calculated off the drug's list price. A high list price with a large rebate is far more profitable for the PBM than a low list price with no rebate, even when the high-list-price drug ultimately costs the patient and the health plan more overall. When Semglee launched in 2020 at a genuinely low price, every major PBM declined to cover it. There was no rebate worth chasing.
Biocon and Viatris understood exactly what had happened because in 2021, they launched a second version of the same drug, still branded Semglee, but priced at 95% of Lantus's cost instead of 35%, specifically so PBMs would have a rebate worth taking. It worked for the company. PBMs picked up the pricier version. It did not work for anyone else: by the time it was measured, biosimilar insulin was covered by Medicare Part D plans only about 5% of the time, and Medicare Advantage plans about 3%, despite genuine demand and genuine savings sitting right there on the shelf. Put those numbers next to each other, and the gap is stark: in that same analysis, brand-name Lantus itself was covered by Part D plans 83% of the time. Same drug class, same insurer, roughly 17 times the coverage odds; the only real difference was which one came with a rebate attached.
This isn't a one-off story about one drug. It's the exact pattern federal regulators have now spent over a year unwinding. In 2024 the FTC sued the three PBMs that together handle roughly 80% of every prescription filled in the country, CVS Caremark, Express Scripts, and Optum, alleging all three "artificially inflated the list price of insulin drugs by using anticompetitive and unfair rebating practices" that "hampered patients' access to lower list price drug products, ultimately shifting the cost of the inflated insulin list prices to vulnerable patients." That's point-for-point the same dynamic that sank the cheap version of Semglee. The House Judiciary Committee reached a similar conclusion in its own January 21, 2026, staff report on CVS specifically, titled, without much subtlety, "When CVS Writes the Rules: How CVS Protects Itself From Innovation and Competition."
Since then, all three PBMs have been forced into settlements, and it's worth noting upfront: this has been a Trump-administration FTC action, not a partisan one. Express Scripts settled first, in a consent order that the FTC called its most consequential PBM overhaul to date, finalized in February 2026. The Commission's case against Optum "has been withdrawn from adjudication to consider a proposed consent agreement," meaning it's negotiated but not yet final. Caremark settled most recently, announced July 14, with the FTC projecting the deal locks in up to $8.5 billion in consumer savings over ten years and unlocks another $4.5 billion from point-of-sale rebates. FTC Chairman Andrew Ferguson didn't mince words, announcing it: "The FTC under President Trump won't stand for anticompetitive behavior that drives up prices for American consumers... The settlement with Caremark brings billions in real savings to consumers feeling the pinch from excessive prescription drug prices."
The Caremark settlement's terms are specific: Caremark must stop discriminating against low-cost versions of a drug on its formularies, pass point-of-sale rebates through to members rather than pocket them, and maintain affordability programs that cap members' out-of-pocket insulin costs. Those are the exact mechanisms that kept the cheap Semglee off formularies in the first place, now written into a federal consent order as things Caremark is no longer allowed to do.
Who benefits, and who doesn't, and it's worth being precise here. Biocon, which actually made the cheap insulin, lost. They couldn't get their honestly-priced version in front of patients without repricing it upward, which defeated the entire point of a biosimilar. Sanofi, maker of brand-name Lantus, benefited, since keeping a genuine low-cost competitor off formularies protects demand for the product it would have competed against. And the PBMs benefited on a separate track entirely, making more money running a rebate system built around the highest list price than they'd have made covering the cheapest one. Three different parties, three different reasons to prefer the world as it turned out, and none of them required breaking a law.
It's also worth naming who's actually cashing the check here, since it's not who you'd assume. None of the three PBMs at the center of this story is owned by a drug manufacturer. CVS Caremark is owned by CVS Health, which also owns the insurer Aetna. Express Scripts is owned by Cigna. Optum Rx is owned by UnitedHealth Group, alongside UnitedHealthcare. These are insurance conglomerates that also happen to run the pharmacy middleman layer, not pharmaceutical companies moonlighting as insurers. If that pairing sounds familiar, it should: UnitedHealth and CVS are the same two companies this outlet already covered for denying medical care at rates as high as 80% under a reform pledge they'd publicly signed on to. Same conglomerates, same structural incentive to control the gate between a patient and whatever they need, whether that gate is a prior authorization or a drug formulary.
Legal doesn't mean right, and it's worth being precise about what actually happened here instead of reaching for the nearest scary word. This wasn't collusion, which would mean competing companies agreeing together, and the FTC never accused Caremark, Express Scripts, and Optum of conspiring with each other. It sued each of them separately for their own conduct. It also wasn't a monopoly in the legal sense, that term describes single-firm dominance, not three competing companies independently landing on the same playbook. What it was is simpler and doesn't need either word: rent-seeking, a legal, garden-variety case of extracting profit by manipulating market rules rather than by making a better or cheaper product. None of this required an illegal agreement. It just required a rebate structure that rewards whoever can extract the biggest rebate, not whoever makes the best or cheapest drug. Call it what people across the political spectrum already call it when a company protects its profits from real competition through structural leverage instead of a better product: crony capitalism, dressed up as a pricing strategy.
Three Honest Ways to Read This
The system is being fixed, slowly. Three settlements in five months, with real structural requirements attached, is more federal action against PBM rebate practices than the industry has faced in years. That's a genuine, measurable step, not nothing.
The fix arrived after the damage, not before it. Semglee is already gone. The patients who couldn't get it covered between 2020 and 2025 didn't get that coverage back. A settlement that reshapes the rules going forward doesn't undo five years of a workable, cheaper option being effectively locked out of the market.
Nobody had to break the law to make this happen. That might be the most uncomfortable, honest read of all. A legal rebate structure, applied consistently, was enough on its own to push a cheaper, interchangeable insulin option out of existence and leave patients more exposed to exactly the kind of supply shock Texas is dealing with this week.
Corporatocracy is not a market failure. It is the market succeeding — at the wrong thing, for the wrong people, on purpose.
What You Can Actually Do With This
- If you or someone you know is on insulin, ask your pharmacist directly whether a lower-cost interchangeable biosimilar is available and why it may or may not be on your plan's formulary. Don't assume the sticker price you're quoted is the only option.
- Watch the Optum Rx settlement; it still needs final FTC sign-off, and it's the last of the three "Big" PBM cases to close.
- If this system frustrates you, know that PBM reform has become one of the few genuinely bipartisan pushes in Congress in recent years. Telling your representatives you support continued PBM rebate transparency requirements isn't a partisan ask.
Sources
v64otd.com. The Insurers Pledged Reform. One Year Later, Some Still Deny Care 80% of the Time., July 28, 2026 (companion piece on UnitedHealth and CVS Health's Medicare Advantage denial rates).
Drug Channels. The Top Pharmacy Benefit Managers of 2025: Market Share and Key Industry Developments — confirms CVS Caremark is owned by CVS Health, Express Scripts by Cigna, and Optum Rx by UnitedHealth Group.
Federal Trade Commission. FTC Secures Major Settlement with Caremark, Resolving Antitrust Case Against Second Drug Middleman, July 14, 2026 (includes Chairman Andrew N. Ferguson's on-record statement and full settlement terms).
Federal Trade Commission. FTC Sues Prescription Drug Middlemen for Artificially Inflating Insulin Drug Prices, 2024 (original complaint against Caremark, Express Scripts, and Optum); FTC Secures Landmark Settlement with Express Scripts to Lower Drug Costs for American Patients, February 2026.
U.S. House Judiciary Committee. Interim Staff Report, When CVS Writes the Rules: How CVS Protects Itself From Innovation and Competition, January 21, 2026.
Reporting on Optum's proposed FTC settlement, pending final agency approval — Fierce Healthcare, Modern Healthcare, Healthcare Dive, BenefitsPro (June 2026).
Biosimilars Council / Association for Accessible Medicines. Pharmacy Benefit Managers Are Blocking Patient Access to Biosimilar Insulin — Avalere Health analysis of the five largest Medicare Part D parent organizations (2023), including the 83%-Lantus-versus-3%-biosimilar Part D coverage comparison and Medicare Advantage coverage rates for biosimilar insulin.
AJMC. Payer Controls Limiting Semglee Uptake Despite Patient Demand.
GaBI Online / Fierce Pharma / Axios. Coverage of Viatris/Biocon's November 2021 launch of a second, higher-priced version of Semglee (WAC $404.04, versus $147.98 for the unbranded version) to secure PBM rebate eligibility.
Reporting on Biocon's discontinuation of Semglee vials and pens, effective December 31, 2025 — MedFinder, ScienceInsights.
STAT News, Becker's Hospital Review, WRAL. Coverage of Sanofi's "intermittent supply" of Lantus SoloStar pens amid rising demand following Semglee's exit, July 2026.
Texas Health and Human Services Commission / Texas Vendor Drug Program. Change in Preferred Drug List Status for Hypoglycemics, Insulin and Related Drug Class Effective July 27, 2026, posted July 23, 2026 — confirmed via direct browser access to the Vendor Drug Program's own news page, txvendordrug.com/about/news, which reads in full: "Due to high product demand, Sanofi is currently experiencing shipping delays with Lantus Solostar resulting in product backorder. In response, the Texas Health and Human Services Commission temporarily removed the non-preferred status from certain insulin products on the preferred drug list (PDL)."