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Novo Nordisk and Eli Lilly have struck deals with the federal government. The deals aim to make their blockbuster weight loss and Type 2 diabetes drugs more affordable under the Medicare and Medicaid programs.
The Trump administration revealed the agreements Nov. 6. Under the plans, the monthly out-of-pocket costs for patients enrolled in Medicaid and Medicare on GLP-1 medications could range from $50 to around $350, depending on dosage and insurance coverage. Eli Lilly is the maker of Mounjaro and Zepbound, while Novo Nordisk produces Ozempic and Wegovy.
Currently, list prices for these drugs are more than $1,000 a month. Individuals whose insurance covers the drugs usually pay much less than the list price. However, many plans do not include them.
However, both pharmaceutical companies have introduced lower cost options in recent months for patients paying in cash and purchasing the drugs directly through their websites.
Expanded use
Medicare and Medicaid already cover the companies’ drugs approved by the U.S. Food and Drug Administration for Type 2 diabetes. Under the new deals, they will also cover for some patients who are overweight or obese, the administration said.
According to the administration, the agreements with Novo Nodisk and Eli Lilly include a promise to offer starting doses of their upcoming obesity pills – if they get FDA approval – at $149 a month for people on Medicare, Medicaid or using “TrumpRX.”
In return for these commitments, both companies will get a three-year exemption from certain tariffs.
Direct-to-consumer pricing is expected to roll out next year to Medicare and Medicaid users, as well as on the planned TrumpRx pharmaceutical website, according to the White House.
According to The Hill, officials noted these prices are separate from the Medicare Drug Price Negotiation Program. Earlier this year, Ozempic and Wegovy was chosen for the next round of negotiations under that initiative.
In a statement, Novo Nordisk President and CEO Mike Doustdar said, “Novo Nordisk has always worked to secure affordable access to our innovative medicines, and today’s announcement will bring semaglutide medicines to more American patients at a lower cost. Importantly, this also expands obesity medication access in Medicare, which will allow people living with obesity to access authentic Wegovy.”
The Danish drugmaker with U.S. headquarters in Plainsboro noted that it is working with the administration to finalize “the details of the agreement.”
Other deals
The deals are part of Trump’s “most-favored-nation price” initiative that seeks to bring down American drug prices to either the same or lower as other developed countries. Since calling on the industry to reduce costs voluntarily, the White House has reached deals with companies including Pfizer, AstraZeneca and EMD Serono.
“Promise Made. Promise Kept. President Trump is lowering drug costs for the American people,” White House Press Secretary Karoline Leavitt posted on X.
Trump said in a statement, “In case after case, our citizens pay massively higher prices than other nations pay for the same exact pill, from the same factory, effectively subsidizing socialism abroad with skyrocketing prices at home. So we would spend tremendous amounts of money in order to provide inexpensive drugs to another country. And when I say the price is different, you can see some examples where the price is beyond anything — four times, five times different.”
Commenting on the development, HealthCare Institute of New Jersey President and CEO Chrissy Buteas said, “New Jersey’s life sciences will continue negotiating with all stakeholders on ways to lower costs for patients that don’t jeopardize our ability to discover the next generation of life-saving treatment and cures.
“Today’s announcement also showcases that we are an essential part of the health care system that reduces long-term costs by focusing on prevention of chronic disease, and the tremendous costs we help the system avoid as we find new ways to keep people healthy and out of hospitals.”
