Pressure at Thinktank

Pressure Builds on GLP-1 Pricing, with More to Come

Last week, the U.S. Senate launched an investigation into the high price of semaglutide, sold as Ozempic and Wegovy by Novo Nordisk. Yes, pressure on GLP-1 pricing is building and you can be confident there’s more to come. Senator Bernie Sanders chairs the Senate Committee on Health, Education, Labor, and Pensions, which is undertaking this investigation. He said:

“The scientists at Novo Nordisk deserve great credit for developing these drugs that have the potential to be a game changer for millions of Americans struggling with type 2 diabetes and obesity. As important as these drugs are, they will not do any good for the millions of patients who cannot afford them.

“If the prices for these products are not substantially reduced they also have the potential to bankrupt Medicare, Medicaid, and our entire health care system.”

It’s Complicated

To be fair, Novo Nordisk finds itself in the hotseat in part because they’ve scored a huge success of innovation to overcome one of the biggest health challenges facing the world today – obesity. The other cause for this harsh attention is the utterly screwed up pricing of pharmaceuticals in the United States. Americans pay the highest prices in the world for pharmaceuticals. On the scorecard of high drug prices, the price for semaglutide is far from the highest. But that won’t keep Ozempic and Wegovy from becoming case studies in exploitation of a flawed health system.

Responding to Senator Sanders, Novo Nordisk warned against viewing this simplistically:

“It’s easy to oversimplify the science that goes into understanding disease and developing and producing new treatments, as well as the intricacies of U.S. and global healthcare systems. However, the public debate doesn’t always take into account this extremely complex reality.”

Under pressure, it’s easy to feel misunderstood. But it’s worth noting that Sanders is no simpleton.

More to Come

As David Arterburn explained in his keynote lecture to the Obesity Medicine Association, this pressure will not ease. If anything, it will increase because these medicines have real potential to bend the curve on population health. But that benefit to public health will only happen if use of these medicines occurs at scale. Achieving such scale of use will absolutely require the cost to come down.

Novo Nordisk will not be alone in the spotlight. Sanders said the committee will be looking into pricing for Lilly’s drugs in this market – Mounjaro and Zepbound.

The day will come, as it has in other markets before, when these innovative drugs are “cheap as chips,” as physician-scientist Sir Stephen O’Rahilly has predicted. Hang on, though. It will be a bumpy ride.

Click here, here, here, and here for more on rising price pressure and the path ahead for advanced obesity medicines.

Pressure at Thinktank, photograph by Sasha Taylor, licensed under CC BY-SA 4.0

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April 30, 2024