President Donald Trump on Thursday announced deals with Eli Lilly and Novo Nordisk to slash the prices of some of their obesity drugs, including upcoming pills, in a landmark effort to expand access to the costly blockbuster treatments.
The agreements will cut prices of so-called GLP-1 drugs for Medicare and Medicaid beneficiaries in 2026 and offer the treatments directly to consumers at a discount on a website the Trump administration is launching in January called TrumpRx.gov.
That means Medicare will start covering obesity drugs for some patients for the first time starting mid-2026, a long-awaited move that could broaden the market for the medicines and spur more private insurers to cover them. Certain Medicare patients will pay a copay of $50 per month for all approved uses of injectable and oral GLP-1 drugs, including diabetes and obesity treatment.
Starting doses of upcoming obesity pills from Eli Lilly and Novo Nordisk, pending approvals, will be $145 per month for everyone getting them through Medicare, Medicaid or TrumpRx, a senior administration official who declined to be named told reporters during a briefing Thursday.
Novo Nordisk’s oral version of its obesity injection Wegovy could enter the market by year-end, while Eli Lilly’s pill orforglipron could launch next year. The Food and Drug Administration on Thursday said it has awarded priority review vouchers, which expedite the review timelines of new potential drugs, to the two pills.
Starting doses of existing injections like Novo’s Wegovy and Lilly’s Zepbound will be $350 per month on TrumpRX, but will “trend down” to $245 per month over a two-year period, another senior administration official said during the briefing.
Wegovy and Zepbound have not been covered by Medicare for weight loss, “and they’ve only rarely been covered by Medicaid,” Trump said in the Oval Office. “They’ve often cost consumers more than $1,000 per month, some a lot more than that. … That ends starting today.”
The deals are among the most politically significant announcements to date in the Trump administration’s push to rein in high U.S. drug costs by tying them to the lowest prices abroad. As part of the president’s “most favored nation” policy, he has announced deals with Pfizer, AstraZeneca and EMD Serono to sell certain drugs directly to patients at a discount, in exchange for exemptions from planned pharmaceutical tariffs.
“This is the biggest drug in our country, and that’s why this is the most important of all the [most favored nation] announcements we’ve made,” Health and Human Services Secretary Robert F. Kennedy Jr. said during the briefing. “This is going to have the biggest impact on the American people. All Americans, even those who are not on Medicaid, Medicare, are going to be able to get the same price for their drugs, for their GLP-1s.”
Kennedy claimed the American public will lose 125 million pounds by this time next year, saying the expanded access will have “dramatic effects on human health” in the U.S.
The event was delayed when a man who was standing behind Trump fainted.
The list prices of existing obesity drugs – roughly $1,000 to $1,350 per month before insurance – are a huge barrier for patients, many of whom could benefit from their ability to promote weight loss and ease other related health complications such as cardiovascular risks and sleep apnea. Eli Lilly and Novo Nordisk already have programs to sell their weight loss drugs at a discount directly to cash-paying consumers, but the new agreements appear to take those efforts to boost access a step further.
Novo Nordisk and Eli Lilly have agreed to cut the price Medicare pays for GLP-1s it already covers for diabetes and other indications, along with those drugs for obesity, to $245 per month. The companies agreed to extend lower government pricing for their GLP-1 drugs – $245 per month across all other nonstarting doses – to all 50 Medicaid programs for all covered uses. States will have to opt into those prices, meaning some may not.
But Medicare coverage could have a bigger impact on who gets the drugs because the program covers about 66 million people, and is the primary source of insurance for people ages 65 and above. The new obesity drug coverage will be enabled through a pilot program designed to cover a majority of beneficiaries under Medicare Part D, which are the program’s prescription drug plans.
Another senior administration official said around 10% of Medicare beneficiaries will be eligible to receive GLP-1s for obesity and cardiovascular and metabolic benefits. Eligible patients will fall into three cohorts. The first includes those who are overweight, with a body mass index greater than 27 or with prediabetes or established cardiovascular disease.
The second group is people with obesity – with a BMI greater than 30 – and uncontrolled hypertension, kidney disease or heart failure. The third group is patients with severe obesity, or anyone with a BMI greater than 35.
GLP-1s for weight loss are approved for a much broader population: people who have obesity or are overweight with one related condition. The administration official said, “We are constraining the access for patients that will benefit clinically from it, we’ve worked very hard to strike a balance between broad access that just makes sure to capture patients that will benefit clinically.”
As part of the deals, Eli Lilly and Novo Nordisk also made similar pledges to the ones other drugmakers have made as part of Trump’s most favored nation agreements. The companies will guarantee most favored nation pricing on all new medicines they bring to market, provide that pricing to every state Medicaid program, offer at least U.S. net prices or most favored nation pricing on nearly all primary care drugs on TrumpRx and share savings from foreign drug price increases on existing products, one senior administration official said.
Also on Thursday, Eli Lilly said it would lower prices by $50 on its own direct-to-consumer platform, LillyDirect, which already offers Zepbound at a discount to cash-paying patients. The multidose pen of Zepbound will be available at $299 per month at the lowest dose, with additional doses being priced up to $449 per month.
Eli Lilly’s pill, once approved, will be available at the lowest dose starting at $149 per month.
A major pricing change
In a statement Thursday, Eli Lilly CEO David Ricks said the deal marks “a pivotal moment in U.S. health care policy and a defining milestone for Lilly,” which is focused on “improving outcomes, strengthening the U.S. healthcare system, and contributing to the health of our nation for generations to come.”
In a separate statement, Novo Nordisk CEO Mike Doustdar said, “today’s announcement will bring semaglutide medicines to more American patients at a lower cost.” Semaglutide is the active ingredient in Wegovy and Ozempic.
It’s not the first time the government has floated Medicare coverage of obesity drugs. Former President Joe Biden proposed a rule at the end of his term that would have allowed the program to cover those treatments, but the Trump administration in April declined to finalize the measure.
Biden’s proposal would have extended access to roughly 3.4 million Medicare beneficiaries. But it was controversial at the time, as it would cost taxpayers as much as $35 billion over nine years, a congressional analysis found.
But some health experts contend that covering the drugs could eliminate the downstream costs involved with treating obesity-related conditions.
Semaglutide is also included in the next round of Medicare drug price negotiations under the Inflation Reduction Act, which Biden signed into law in 2022. Trump is expected to unveil the new prices of the 15 drugs selected for those talks by Nov. 30.
Tirzepatide, the active ingredient in Eli Lilly’s Zepbound and diabetes injection Mounjaro, likely won’t be eligible for those negotiations until the end of the decade.
By CNBC
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