President Trump announced Nov. 6 that makers of popular weight-loss drugs have agreed to lower the prices Americans pay.
The announcement follows Trump's announcement. decree since May, when he ordered drug companies to address higher prices for their drugs in the U.S. compared to other countries and charge Americans the lowest price in the world.
As part of the deal, Eli Lilly and Novo Nordisk agreed to lower the prices of their GLP-1 injectables to $350 for a month's supply and further reduce that cost to $245 over the next two years. The drugs currently cost about $1,000 for a month's supply, or about half that amount if patients get them directly through companies through newly launched direct-to-consumer programs. The price applies to a new version of Lilly's weight-loss drug Zepbound, which can come in a single-use, multi-dose pen—it's currently sold in multi-strength vials as patients start at low doses and gradually increase doses. Both companies also have GLP-1 oral diet pills; Novo Nordisk is currently under review by the US Food and Drug Administration (FDA), and Lilly plans to file a request for approval of its product by the end of the year. If approved, a month's supply of the pills would cost $149. The FDA also announced that Lilly's oral drug, orforglipronis part of a program in which certain drugs will receive priority vouchers that will entitle them to much shorter review periods for approval, on the order of weeks or months rather than a year or more.
Read more: Health risks and benefits of weight loss drugs
These prices represent out-of-pocket costs for patients receiving them without insurance and through the government using taxpayer funds. Because these prices will now be transparent and affordable to patients, commercial insurers and employer-based insurance plans are expected to follow suit and cover drugs at reduced prices. Lilly CEO David Ricks said during the company's Nov. 6 press conference that about six in 10 employers currently pay their workers for the company's weight-loss drug and said he hopes today's announcement will be a “trigger” that will encourage more people to do so.
The decision is the first step toward the goal of equalizing drug prices so that Americans don't pay more for the same drugs than people in other parts of the world. This gap is driven by a complex drug payment model that involves pharmacy benefit managers who manage prescription drug benefits for insurers and employers and use their massive purchasing power to raise drug prices. “We expect that by making prices transparent and through government coverage in Medicare, it will make it increasingly inconvenient for employers or pharmacy benefit managers who choose not to cover this important class of drugs,” Dr. Dan Skowronski, Lilly's chief scientific officer, tells TIME. “I think the scale and efficiency that a small molecule like orforgliprone can achieve at $149 a month will change the lives of many Americans.”
Read more: The high cost of using weight loss drugs to lose weight
It is not yet clear how long the terms of the deal will last. The agreement calls for drug companies to lower their prices to cash and government programs not only for weight-loss drugs but also for a portfolio of other products, and to bring certain new products to the U.S. market at so-called MFN prices, or the lowest price at which they sell their drugs in the world. On the government's side, it will provide priority vouchers from the FDA for faster review and potential approval of a select group of new products.
For Medicare beneficiaries, the agreement with Lilly and Novo Nordisk expands coverage beyond diabetes to also include obesity, which will cover about 10% more Medicare beneficiaries. Medicare will begin covering medications at $245 per month for both diabetes and obesity; Medicare currently covers medications for diabetes but not for obesity. Beneficiaries will only be responsible for the $50 per month copayment.
The expanded coverage will not cost taxpayers, senior White House officials said, because the new Centers for Medicare and Medicaid Services spending represents savings on diabetes indications; these savings will go towards paying for obesity insurance. They expected to introduce new prices in the spring or mid-2026.
Senior officials said that Medicare beneficiaries applying for coverage of GLP-1 anti-obesity drugs will have to meet strict eligibility criteria and that they will follow Make America Healthy Again principles to address risk factors for chronic diseases. The drugs will be covered for people with a body mass index (BMI) of 27 or higher, for example if they also have other metabolic risk factors such as prediabetes, because the drugs can reduce the risk of diabetes, stroke, heart attack or peripheral artery disease.
For people with a BMI over 30, the drugs will be covered if they also have serious kidney disease, heart failure or uncontrolled high blood pressure. For people without any of these conditions, Medicare will cover obesity drugs if their BMI is 35 or higher.
Medicaid beneficiaries will also receive reduced prices, but the timing of these reductions will vary by state.
