High costs of GLP-1 drugs push out low-income patients

GLP-1 agonists, which include Novo Nordisk's Ozempic and Eli Lilly's Mounjaro, were originally approved to treat diabetes. Over the last few years, FDA has also approved rebranded versions of these drugs, including Novo's Wegovy and Lilly's Zepbound, to treat obesity.

Although these drugs are in high demand, their high costs have made it difficult for many patients to access them. In the United States, Novo Nordisk charges around $1,000 for a month's supply of Ozempic, and Eli Lilly charges roughly the same for a month's supply of Mounjaro.

According to a KFF poll, around 54% of adults who have taken a GLP-1 drug, including those with insurance, said it was "difficult" to afford the cost of the drugs. In particular, low-income patients with high-deductible health plans, Medicaid, or Medicare have not been able to afford or access these needed medications.

Many insurers have different coverage rules for GLP-1 drugs, and some are tightening access due to their high costs. State Medicaid plans also vary in their coverage of GLP-1 drugs for weight loss, and Medicare won't cover the medications if they're prescribed only for obesity.

"They're kind of disadvantaged in multiple ways already and this is just one more way," said Wedad Rahman, an endocrinologist with Piedmont Healthcare. "… I have to pick something else that's more affordable and isn't as good for them."

"Those patients who have a fixed income are going to be our more vulnerable patients," said Brandi Addison, an endocrinologist in Corpus Christi, Texas.

Telehealth companies offer discounted weight-loss drugs

Currently, Wegovy and Zepbound are protected by patents until at least 2032, which means that generic versions aren't yet available. However, during supply shortages, FDA allows compounding pharmacies to make "copycat versions" of drugs, Modern Healthcare reports. Now, some telehealth companies, including Ro and Hims and Hers Health, are offering compounded versions of these weight-loss drugs at much cheaper prices.

According to Hims, it is offering a treatment that has the same active ingredient as Wegovy for $199 a month — an 85% discount from the original sales price. The company is also planning to offer compounded tirezepatide, which is the active ingredient in Eli Lilly's Mounjaro and Zepbound, in the next few months.

Offering compounded versions of these drugs at lower prices will help customers access them without "navigating shortages and costs that are currently limiting access to the branded medications," Hims said in a press release.

"It's gonna be a big part of the weight loss category going forward," Hims CEO Andrew Dudum said. "Our belief is that compounding can be done very safely, if done correctly."

Currently, it's not clear how safe or effective these compounded medications are. FDA does not review compounded medications for safety, effectiveness, or quality like branded or generic medications, and they are technically not approved by the agency.

However, Hims CMO Pat Carroll said, "Compounding GLP-1s is legal and safe. We're now partnering with a leading US manufacturer of generic and 503B compounded injectable medications."

"They are registered with the FDA as a 503B outsourcing facility, which is subject to state and federal oversight," Carroll added.

Advisory Board's weight-related resources

To help you address the growing use of weight management drugs, Advisory Board offers several resources:

This expert insight outlines the five biggest questions about weight management drugs and their answers. Similarly, this expert insight addresses what headlines get wrong about weight management drugs and what healthcare leaders should know instead.

Radio Advisory's Rachel Woods has also covered GLP-1 drugs on the podcast, discussing the potential future of these drugs and how they could help — or hurt — health systems' finances. Other useful resources include this expert insight on the five catalysts that will impact the future of obesity care and this research on three potential pathways for the future of obesity care.

Our weight management and obesity care resource library can also help leaders understand the current care landscape, manage innovations, and prepare for transformations in care. (Rayasam, KFF Health News, 5/21; Muller/Nix, Bloomberg/Modern Healthcare, 5/20; Weiss, Business Insider, 5/20)