White House Deal Lowers Prices of Weight-Loss Drugs

President Trump announced Nov. 6 that makers of popular weight-loss drugs had agreed to reduce the prices Americans pay.

The announcement follows Trump’s May executive order, which ordered pharmaceutical companies to address the higher price of their drugs in the United States compared to other countries and charge Americans the lowest price in the world.

As part of the deal, Eli Lilly and Novo Nordisk agreed to lower the price of their injectable GLP-1 drugs to $350 for a month’s supply, and further reduce that cost to $245 over the next two years. The drugs currently cost about $1,000 for a month’s supply, or about half that amount if patients get them directly from companies through recently launched direct-to-consumer programs. The price applies to a new version of Lilly’s weight-loss drug Zepbound, which could come as a single, multi-dose pen. It is currently sold in differently dosed vials as patients start with low doses and progress to higher doses. Both companies also offer a GLP-1 oral pill for weight loss; Novo Nordisk’s product is currently under review by the U.S. Food and Drug Administration (FDA) and Lilly plans to submit an application for approval of its product by the end of the year. If approved, the pills would cost $149 for a month’s supply. The FDA also announced that Lilly’s oral drug, orforglipron, is part of a program in which certain drugs would receive priority vouchers that would entitle them to much shorter review periods for approval, on the order of weeks or months rather than a year or more.

Learn more: The health risks and benefits of weight loss medications

These prices correspond to the costs that patients must pay without insurance and through the government, using taxpayer funds. Since these prices will now be transparent and accessible to patients, commercial insurers and employer insurance plans are expected to follow suit and cover medications at discounted prices. Lilly CEO David Ricks said at a company news conference Nov. 6 that currently, about six in 10 employers cover the company’s weight-loss drugs for their workers, and he hoped today’s announcement would be a “trigger” event to encourage more to do so.

The move is the first step toward the goal of equalizing drug prices so that Americans do not pay more for the same drugs than people in other parts of the world. This gap is due to a complex drug payment model that involves pharmacy benefit managers who manage prescription drug benefits for insurance companies and employers, and who have used their mass purchasing power to drive up drug prices. “We hope that by making prices transparent and having them covered by the government in Medicare, it will make the situation increasingly uncomfortable for employers or pharmacy benefit managers who have chosen not to cover this important class of drugs,” Dr. Dan Skovronsky, Lilly’s chief scientific officer, told TIME. “I believe the scale and effectiveness that a small molecule like orforglipron can achieve at a price of $149 per month will be life-changing for many Americans.”

Learn more: The high cost of using weight loss drugs to lose weight

It is not immediately clear how long the agreement will last. The agreement involves pharmaceutical companies reducing government and fee-for-service program prices not only for weight-loss drugs, but also for a portfolio of other products, and also supplying certain new products to the U.S. market at the so-called most favored nation price, or the lowest price at which they sell their drug in the world. For its part, the government would provide FDA priority vouchers for faster review and potential approval of a select group of new products.

For Medicare beneficiaries, the deal with Lilly and Novo Nordisk expands coverage beyond diabetes to also include obesity, which would cover about an additional 10 percent of Medicare beneficiaries. Medicare would start covering drugs at $245 per month for diabetes and obesity; Currently, Medicare covers medications to treat diabetes, but not obesity. Beneficiaries would only be responsible for a co-payment of $50 per month.

The expanded coverage would not cost taxpayers, senior White House officials said, because the new cost to the Centers for Medicare and Medicaid Services represents a savings on the diabetes indication; these savings will be used to finance coverage against obesity. They planned to roll out the new pricing in spring or mid-2026.

Top officials said Medicare beneficiaries seeking coverage for GLP-1 obesity drugs would have to meet strict eligibility criteria and would follow Make America Healthier Again principles to address chronic disease risk factors. The drugs would be covered for people with a body mass index (BMI) of 27 or above, for example, if they also have other metabolic risk factors, such as prediabetes, because the drugs could reduce their risk of developing diabetes, stroke, heart attack or peripheral artery disease.

For people with a BMI over 30, the medications would be covered if they also have severe kidney disease, heart failure or uncontrolled high blood pressure. For people without any of these conditions, Medicare would cover obesity medications if they have a BMI of 35 or higher.