Generic Liraglutide Is Here – Will It Make Any Difference?

One of the four dimensions that sum to a terrible problem of inadequate scale in obesity care is cost. Right now, the list prices for obesity medicines like semaglutide and tirzepatide in the U.S. put them out of reach for all but the wealthy and the well-insured. So will it help that a generic GLP-1 agonist – liraglutide – arrived this week?

Our short answer: yes, but not right away.

Cheap as Chips?

We know where this is headed. Sir Stephen O’Rahilly described it in 2022. He compared the coming evolution of obesity care to hypertension, where there were once few options and the consequences of untreated blood pressure were costly in both human and economic terms. Now we have an abundance of drugs for controlling hypertension and they’re “cheap as chips.”

This is the situation that awaits with obesity medicines. All that stands in the way is greed and inertia.

But a quick look at the particulars of the generic liraglutide will tell you that it will not lead prices to crumble for GLP-1 medicines – not right away. In the first place, Teva is the only company with a generic offering. It is an authorized generic. We will spare you the arcane details of this phenomenon, but the net effect is that the discounts are not huge and many PBMs (pharmacy benefit managers) won’t even cover them because they can make a bigger profit on branded and thus more expensive products.

It’s a bloody mess. And it represents only one of the many ways that PBMs and pharmaceutical industry tactics work in synergy to drive prices ever higher in the U.S. If you want to know more about the PBM dimension of this, Rebecca Robbins and Reed Abelson have published a thorough investigative report in the New York Times.

We also note that the generic liraglutide launched this week is labeled and sold in doses that are for diabetes – not obesity. So this particular offering won’t bring much relief to people needing a GLP-1 for obesity.

Leaving Money on the Table

But the truth is that greed is not only hurting people living with obesity and keeping them from getting care. Just as the recording industry resisted the opportunity that awaited in digital music, pharma is hanging on to a high price, low volume strategy for obesity medicines. Rather than seizing the opportunity to improve population health by making these medicines truly accessible to a wide population, they are doing their best to keep prices high for now – especially in the U.S.

This will not last. The public health imperative is too great and so is the opportunity to do well while doing some good for the health of a great many people. More generics will come. So will more innovators and so will reforms to U.S. drug pricing. Change is coming because sooner or later, greed and inertia will give way to needed progress.

Click here, here, and here for more on generic liraglutide. For more on authorized generics and PBMs, click here and here.

The Golden Knight, print by Gustav Klimt / Wikimedia Commons

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June 26, 2024