GLP-1s - What We Know Right Now, For Now (Part 3)

A sudden influx of substantial profits gained from weight loss medications is likely to increase competition in the market. There are numerous clinical trials being conducted involving either novel or expanded indications for AOMs – all expected to be introduced to the market within the next 3-5 years. This uptick in competition, once the new agents are FDA approved, may impact pricing for popular GLP-1 medications like Zepbound and Wegovy. However, the pipeline for AOMs is not expected to be crowded until 2026 or later^18,19,23. Projections of approvals in the AOM space will be priced at a premium if these medications prove to have an advantage in either safety, (oral) route of administration, or efficacy against established AOMs such as Wegovy and Saxenda. Thus, the downward pressure of pricing over the next 3-4 years is unlikely given the estimated steady net costs of GLP-1s for weight loss in conjunction with the projected increases in the number of patients eligible to receive AOMs²³.

The Rising Costs and Competitive Landscape of GLP-1 Drugs

Four GLP-1 drugs (Mounjaro, Ozempic, Saxenda, and Wegovy) account for 9% of overall prescription costs net of rebates per member per month (image below)¹⁷. These medications are expensive and retail for as much as $16k per year for certain formulations^17,18. Wegovy costs employers between $9-10k per patient per year after discounts and rebates¹⁷.

With the recent increase in sales, many manufacturers are clamoring to get a piece of the “GLP-1 pie".

• New and more effective GLP-1 drugs are expected to be approved soon.  

• There are over 250 weight loss drugs being studied with a large boom in market entry expected by 2026^18,19. A recent example of a newer GLP-1 that was recently released back in November 2023 is Eli Lilly’s Zepbound.

• Other chronic weight management medications currently in the pipeline can be found below¹⁷.

At the 2024 American Diabetes Association conference, researchers are expected to present data on 27 GLP-1 drugs that are currently in development¹⁹. While most are likely years away from FDA approval, many could be available in the U.S. within the next few years. More weight loss agents entering the market could help alleviate drug shortages in the U.S. Thus, increased access to AOMs could result in improved health outcomes. Moreover, patients can respond differently to treatments and may have a better response to these new medications in the pipeline.

The Expanding Pipeline of AOMs: What’s Next for Weight Loss Medications

It’s not just GLP-1 drugs in the pipeline.

Denmark based biotech firm Zealand Pharma released data showing a high dose of its experimental weight loss drug petrelintide (amylin analog) helped reduce body weight by an average of 8.6% at 16 weeks^18,20. This agent is currently in phase 1b trials.

Eli Lilly’s new retatrutide combines a GLP-1, glucagon, and GIP (glucose-dependent insulinotropic polypeptide).

• In one trial, participants lost approximately 24% of their body weight – the equivalent of about 58 pounds (this yielded more weight loss than any other weight loss drug currently on the market)^18,21.

Eli Lilly’s mazdutide combines GLP-1 and glucagon.

• A previous study found this combination led to an average body weight reduction of 14.4% after 48 weeks^18,22.

The pipeline for AOMs is expected to be crowded however, not until 2026 or later^18,19,23. Projections of approvals in the AOM space will be priced at a premium if these medications prove to have an advantage in either safety or efficacy against established AOMs such as Wegovy and Saxenda. The downward pressure of pricing is unlikely given the estimated steady net costs of GLP-1s for weight loss coupled with the projected increases in the number of patients eligible to receive AOMs²³.

An IPD budget impact calculation measured the PMPM impact per 1M lives from 2023-2027 of the three approved GLP-1 for chronic weight management (Wegovy, Saxenda, and Zepbound) and anticipated market entry of two additional GLP- for chronic weight management (oral semaglutide and CagriSema)²³. Assumptions were made based on FDA-approved product labeling in addition to:

• Illustrative rebate percentages
  • Wegovy and Zepbound were between 40% and 50% in 2023²³. This amount may increase as additional chronic weight management drugs enter the market.
  • Rebate for Saxenda was 35% to 45% in 2023 and this rebate amount may increase each year²³.
  • Rebates for Oral Semaglutide and CagriSema (if FDA approved) would be similar to those for Wegovy²³.
• The 2024 U.S. Census Bureau population breakdown of adults (ages >18) versus adolescent (ages 12-17) lives— 77.8% and 7.88%, respectively^24,25.
• Anticipated year over year growth of the treatment population (number of member lives) eligible for chronic weight management with GLP-1²³.

Observing the following GLP-1s for weight loss

• Wegovy

• Saxenda

• Zepbound

• Oral Saxenda
  • ETA to market if FDA approves NDA 2026-27
  • In development, Phase III trials

• CagriSema
  • ETA to market if FDA approves NDA 2026-27
  • In development, Phase III trials

How New GLP-1 Entrants and Generics Could Disrupt Pricing Strategies

Other findings argue that, when generics (or in this case new GLP-1s) enter the market space, companies are forced to deploy new pricing strategies to remain competitive. With the entry of even just a handful of generics, generic competitor prices have shown to be below the brand price²⁶. The increased access to generics can also have an impact on improving medication access and potentially driving down costs. For example, albendazole tablets were originally priced at $670. After one year of its generic approval, the price decreased to $210 – around a 70% decrease²⁶. Other examples of this trend can be seen in the infographic below with the annual savings.

Utilizing the National Average Drug Acquisition Cost (NADAC), one study was able to demonstrate that the introduction of generic competition can influence the brand-name price trend before and after the generic’s entry into the market. When a generic equivalent entered the market space, the NADAC price was 65.7% of the brand-name drug price and after three years the brand-name drug price then decreased to 26.0%²⁷. In addition to this finding, in anticipation of the generic's entry into the market the median brand-name drug NADAC price increased by 1.0% per month before generic entry²⁷. After the generic entered the entry period into the market the NADAC price remained stable and increased by 0.4% per month afterwards²⁷.

If the introduction of new GLP-1 for weight loss into the market were to align more with the trends typically associated with the introduction of generics, this may drive costs down due to increased competition. However, given that the class of GLP-1 are not at the stage of generic entry, the decline seen after one year may not be associated with a sharp decrease in price as seen in these studies.

Resources

1. Reagan Sell, C and Midlam, C. GLP-1 drugs: Implications for employer health plans. WTW. Available from: https://www.wtwco.com/en-us/insights/2024/02/glp-1-drugs-implications-for-employer-health-plans. Published Feb 15, 2024.  
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2. Merelli A. GLP-1 generics would be dramatically cheaper than U.S price of Ozempic, study shows, but still profitable. STAT. Available from: https://www.statnews.com/2024/03/29/glp-1-insulin-generics-ozempic-drug-pricing/. Published Mar 29, 2024.  
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3. Lovelace Jr, B. Beyond Ozempic: New GLP-1 drugs promise weight loss and health benefits. NBC News. Available from: https://www.nbcnews.com/health/health-news/beyond-ozempic-glp-1-drugs-promise-weight-loss-health-benefits-rcna157525. Published Jun 23, 2024.  
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4. Zealand Pharma. Petrelintide. Available from: https://www.zealandpharma.com/pipeline/petrelintide/. Published 2024.  
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5. Jastreboff, A; Kaplan, L; Frias, M; et al. Triple-Hormone Receptor Agonist Retatrutide for Obesity - A Phase 2 Trial. The New England Journal of Medicine. 2023; 389 (6):514-526. Published Jun 26, 2023.  
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6. Ji, L., Jiang, H., Cheng, Z. et al. A phase 2 randomised controlled trial of mazdutide in Chinese overweight adults or adults with obesity. Nat Commun 14, 8289 (2023). https://doi.org/10.1038/s41467-023-44067-4  
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7. IPD Analytics. Rx Insights: GLP-1 Receptor Agonists GLP-1 Receptor Agonists Landscape. IPD Analytics Payer & Provider Insights. Published Sep, 2023.  
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8. International Database (IDB). United States Census Bureau. Available from: https://www.census.gov/data-tools/demo/idb/#/dashboard?COUNTRY_YEAR=2024&COUNTRY_YR_ANIM=2024&CCODE_SINGLE=US&CCODE=US. Updated Aug, 2023.
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9. U.S. Centers for Disease Control and Prevention. National Center for Health Statistics. Obesity and overweight. Available from: https://www.cdc.gov/nchs/fastats/obesity-overweight.htm. Updated Jan 5, 2023.  
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10. Conrad R and Lutter R. Generic Competition and Drug Prices: New Evidence Linking Greater Generic Competition and Lower Generic Drug Prices. U.S. Food & Drug Administration. Available from: https://www.fda.gov/about-fda/center-drug-evaluation-and-research-cder/generic-competition-and-drug-prices#:~:text=This%20study%20estimates%20savings%20associated,prices%20below%20the%20brand%20price. Updated Oct 5^th, 2023.
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11. Jamjoom M, Almutairi R, Rodriguez-Monguio R, et al. Generic entry and effect of market competition on outpatient pharmacy drug prices. Journal of Generic Medicines: The Business Journal for the Generic Medicines Sector. 2024; Volume 20 (2). https://doi.org/10.1177/17411343241248521. Published May 28, 2024.