With insulin prices skyrocketing and substantial shortages developing in poorer countries, the World Health Organization said on Wednesday that it would begin testing and approving generic versions of the drug. Agency officials said they hoped to drive down insulin prices by encouraging makers of generic drugs to enter the market, increasing competition. At the moment, the world’s insulin market is dominated by three companies — Eli Lilly, Novo Nordisk and Sanofi — and they have steadily pushed up prices for two decades. “Four hundred million people are living with diabetes, the amount of insulin available is too low and the price is too high, so we really need to do something,” Emer Cooke, the WHO’s head of regulation of medicines and health technologies, said as she announced the plan. The approval process, which the WHO calls “prequalification,” will permit United Nations agencies and medical charities to buy approved generic versions of insulin. The process also will reassure countries without strong regulatory agencies that the approved drugs are safe for their health ministries to purchase. The crisis now facing people with diabetes is equally dire.