Two major drugmakers are trying to convince employers to cover the cost of their pricey weight-loss medications to save on health care spending in the long run.
The efforts by Eli Lilly and Novo Nordisk could be a game-changer for sales, which some analysts say could exceed $100 billion a year, the Wall Street Journal reported Tuesday.
Anti-obesity medications have list prices of more than $1,000 a month and there are so many eligible patients — a study published last week by the Lancet found nearly 75% of American adults were overweight or obese — that they threaten to bust employers' insurance budgets.
"That's a hard investment choice to make when all you're seeing is the cost, especially in year one and year two," Bill Coyle, global head of biopharma at industry consultant ZS, told the Journal. "That's why Lilly and Novo engage employers, to help them understand that story."
Only half of large employers now pay for their workers' weight-loss drugs and coverage is even more limited among smaller employers, which is hindering sales.
Last year, Lilly formed a specialized team of representatives to promote its Zepbound medication months before the drug hit pharmacy shelves in late 2023, the Journal said.
One group that got a visit was the New Jersey State Policemen's Benevolent Association, whose executive director, retired officer Kevin Lyons, said that many of the union's 32,000 members were using weight-loss drugs.
Lyons also serves on the state's health benefits committee and he told the Journal that it's considered canceling coverage because the state employees' health plan has seen its prescription costs soar since the latest wave of medications became available.
Lilly and Novo, which makes the anti-obesity drug Wegovy, have both joined the Greater Philadelphia Business Coalition on Health as affiliate members and funded a committee focused on diabetes and obesity, coalition President Neil Goldfarb said.
Lilly reps gave a presentation about obesity and Zepbound and Novo provided a spreadsheet that companies can use to calculate the cost of covering weight-loss drugs.
"The communication from Novo and Lilly has helped to establish the case that this is a chronic disease," Goldfarb said. "There's a strong argument for covering these drugs in the right circumstances because obesity is having an impact."
Lilly also helped sponsor a September meeting in Chicago of the Midwest Business Group on Health at which Novo was among the exhibitors.
Attendees heard benefits managers from companies including Voya Financial describe their efforts to control the costs of paying for weight loss drugs.
Voya is requiring prior authorization before a prescription can be filled and limiting prescriptions to a 30-day supply, the company's vice president of benefits, Carole Mendoza told the Journal.
"I think we need to be covering these drugs because they are life-changing, but we need to have guardrails in place so that we are appropriately managing the investment," Mendoza said.
