On Might 13, Sen. Bernie Sanders (I-Vt.) printed an open letter to Novo Nordisk on the entrance web page of a number one Danish newspaper, urging the hometown firm to dwell as much as its altruistic requirements by decreasing U.S. costs for its blockbuster diabetes and weight reduction medicine.
What Sanders didn’t notice was that Denmark, a rustic of 6 million, was enduring its personal disaster over the way to pay for the Novo Nordisk medicine Ozempic and Wegovy.
Most different developed international locations, together with Denmark, negotiate down drug prices for his or her residents, paying costs which can be a fraction of these in america. However when a drug is efficient and costly, pharmaceutical corporations can play hardball on pricing. And Novo Nordisk did, a minimum of initially, pushing the Danish well being system to its limits.
The nation’s socialized well being system had for years coated Ozempic as a diabetes remedy, however in 2022 docs started prescribing it for weight reduction, too, and shortly they “emptied all the cash containers in your complete public well being system,” stated College of Copenhagen professor Jens Juul Holst, a co-inventor of the drug.
International locations world wide are fighting how and when to pay for Ozempic, Eli Lilly’s Mounjaro, and different medicine in the identical chemical class, significantly when they’re prescribed for weight reduction. Certainly, the sky-high costs paid within the U.S. set a bar that pharmaceutical corporations can use as they negotiate with different well being techniques.
In Denmark, with prescriptions for the medicine gobbling up 18% of regional drug budgets in 2023, officers have been contemplating the unthinkable in a system that prides itself on free cradle-to-grave protection: forcing sufferers to pay out-of-pocket for Ozempic — a drug made within the nation.
In America, in the meantime, tightening insurance coverage insurance policies are making it tougher for sufferers to get the medicine, that are listed at as much as $1,350 a month.
“There are adjustments month to month in our clinic by way of the provision, protection, which drug is on the market,” stated Michael Blaha, director of medical analysis for the Johns Hopkins Ciccarone Heart for the Prevention of Cardiovascular Illness. He stated that docs and sufferers have been “enjoying a relentless recreation of prior authorization and appeals.”
Particularly, use of the medicine for weight reduction is a hot-button problem. Novo Nordisk and Lilly are battling for protection — joined by some docs and affected person advocate teams, many funded by the drug corporations. They’re urgent to overturn a 2005 federal rule that prohibits Medicare from reimbursing weight reduction therapies.
“There’s a robust assumption that Medicare goes to cowl these medicine for weight problems remedy ultimately,” stated David Kim, an assistant professor of drugs and public well being sciences on the College of Chicago. If Medicare pays, he added, business insurers will in all probability comply with go well with.
The affect on federal and business insurance coverage budgets, he stated, is determined by three unanswered questions: How many individuals will finally get the medicine? For the way lengthy will they take them? And at what worth?
The potential Medicare market alone is big. In 2020 about 13.7 million Medicare beneficiaries, round 1 / 4 of the full, have been recognized as obese or overweight, in accordance with Juliette Cubanski and Tricia Neuman, researchers at KFF, a well being data nonprofit that features KFF Well being Information. Assuming a 50% low cost on a $1,300 month-to-month record worth for Wegovy, that’s a $107 billion price ticket. The complete federal share of Medicare Half D spending in 2024 was projected to be $120 billion.
Novo Nordisk spent $7.6 million lobbying Congress over the previous 12 months, and lobbying disclosures present that the majority of that was to advertise payments within the Home and Senate to broaden use of the GLP-1 medicine.
Strain from drugmakers has been relentless. Pfizer, which has a GLP-1 drug in improvement, commissioned a white paper by consultancy Manatt arguing that Medicare legislation already permits cost for these anti-obesity medicine, since they’ve advantages past weight reduction. Novo and different pharmaceutical corporations have funded analysis that reveals well being care financial savings on power illness by way of use of the medicine.
However the Congressional Price range Workplace, whose judgments about the price of such insurance policies weigh closely in whether or not they’re finally adopted, has but to provide a remaining opinion. In a March presentation, the workplace stated it was “not conscious of empirical proof that immediately hyperlinks the usage of anti-obesity medicines to reductions in different well being care spending.”
Prime Therapeutics, a pharmacy profit supervisor whose purchasers are employers that fund drug plans, launched a examine this yr discovering that solely a 3rd of sufferers placed on a GLP-1 drug stayed on it for a full yr. Meaning insurance coverage protection of the medicine may generally be a waste of cash, stated Patrick Gleason, Prime Therapeutics’ chief of analysis, since analysis reveals that sufferers have a tendency to realize the load again after cessation.
That doesn’t fully shock Holst, the Danish scientist, who stated the GLP-1 medicine’ suppression of urge for food is for many individuals “so miserably boring which you can’t stand it any longer and you must return to your outdated life.”
One reply is perhaps weight reduction applications that make use of the GLP-1s for, say, a yr, adopted by upkeep remedy with cheaper medicine, Kim stated.
A technique or one other, many specialists within the subject say, it’s smart to cowl weight reduction earlier than the onset of the power diseases related to weight problems, like Sort 2 diabetes.
Certainly, as a result of weight problems is related to so many comorbidities, drugmakers at the moment are doing research exhibiting that GLP-1 medicine additionally present optimistic affect on situations like sleep apnea and coronary heart, liver, and kidney ailments.
But even advocates for the medicine’ use acknowledge uncertainty about how lengthy it will take for such well being advantages to kick in, or whether or not shorter-term use would stop or ameliorate longer-term diseases.
“Modeling the impacts is sophisticated,” stated Alison Sexton Ward, a analysis scientist on the College of Southern California’s Schaeffer Heart for Well being Coverage and Economics. “Medical prices gained’t go down instantly. The prevented ailments could also be years sooner or later.”
Beginning subsequent yr, Medicare beneficiaries’ Half D out-of-pocket prices will probably be capped at $2,000, which means U.S. taxpayers will foot the invoice for many Medicare drug bills. So it’s no shock the Congressional Price range Workplace believes the federal government will launch Medicare worth negotiations for semaglutide below the Inflation Discount Act “throughout the subsequent few years,” per its March presentation.
In keeping with the phrases of the act, Ozempic can be eligible for presidency worth negotiation as early as subsequent yr, with new costs mirrored in 2027. The negotiated unit worth would apply to all types of the drug — Ozempic; its higher-dose, weight loss-branded model, Wegovy; and a tablet, Rybelsus.
The place the worth would land is unclear. Wegovy prices sufferers as much as $365 a month in Denmark, which generally doesn’t cowl the drug — and about $140 in Germany and $92 within the U.Okay.
In the meantime, generic drugmakers are gearing as much as promote their variations of semaglutide. These seem set to go on sale in China and Brazil as early as 2026. Individuals are prone to have to attend till a minimum of 2032 due to U.S. patent restrictions. The Federal Commerce Fee has tried to nibble on the medicine’ exclusivity durations by difficult Novo Nordisk patent filings on applicators used to inject the medicine — which might prolong their market exclusivity as much as 30 months.
For now, sufferers who can’t afford or entry the medicine typically flip to compounded types, which aren’t FDA-approved though their uncooked materials comes from FDA-registered factories. Blaha has “a variety of sufferers” who can’t entry the branded medicine and present up on the clinic with compound drug vials.
Two weeks earlier than Sanders printed his letter in Denmark, Novo Nordisk minimize the native worth of Ozempic by 34%, to $130 a month — about 15% of its U.S. record worth. The federal government, which had warned it will cease paying for the drug, agreed to cowl Ozempic diabetes remedy, however just for sufferers who had first tried a less expensive medication akin to metformin.
Wegovy, the identical medication however at the next dose, focused to weight reduction, would in almost all circumstances stay the affected person’s duty at $365 month-to-month, a worth that, whereas modest by U.S. requirements, has sparked intense discussions concerning the uneven affect of sophistication on its affordability, stated Nils Jakob Knudsen, an endocrinologist in Copenhagen.
The calculus of the medicine’ worth is advanced for the Danes, he added, as a result of “the blooming economic system for Novo can also be driving our very wholesome Danish economic system.”
Novo Nordisk’s market valuation of $591 billion on Aug. 2 was significantly larger than your complete GDP of Denmark.
