Lilly's price cut for Zepbound could change the obesity drug market

GLP-1 therapies just got significantly more affordable for patients paying out-of-pocket. Eli Lilly's single-dose vials of Zepbound (tirzepatide) are now available at similar prices to compounded versions of semaglutide. Patients can now get a four-week supply of Zepbound for just $399 for the 2.5 mg dose and $549 for the 5 mg dose, compared to $1,349 for Wegovy and $935 for Ozempic, both from Novo Nordisk. Wegovy is available in five different dosage strengths: 0.25 mg, 0.5 mg, 1 mg, 1.7 mg and 2.4 mg, all at similar prices. (With insurance and Novo Nordisk's savings card, eligible patients can pay as little as $25 for a 1-, 2- or 3-month supply.)

This pricing strategy puts Zepbound in direct competition with compounded alternatives like those from Hims & Hers, which recently announced compounded semaglutide for just $199/month for customers who commit to 12 months. However, the compounded version of semaglutide is not FDA approved.

Lilly's shares rose 0.42% today to USD 954.48, while Novo Nordisk slightly 0.089% on $135.18 and Hims & Hers Health Inc. fell more than 5% following the announcement.

Eli Lilly's decision to cut the price of Zepbound was received positively by analysts, who see it as a smart move to expand market reach and address growing concerns about compounded drugs. Analysts at BMO Capital praised the move for improving patient access and strengthening Lilly's position in manufacturing. While Morgan Stanley acknowledged that there could be potential pressure on average price estimates in the short term, “the additional volume in vials could prove to be a positive offset,” it said in a Yahoo Finance article.

Filed under: Metabolic diseases/Endicrinology
Keywords: drug prices, Eli Lilly, GLP-1 drugs, market competition, obesity treatment, pharmaceutical industry, weight loss drugs