Novo Nordisk and Eli Lilly launch anti-obesity pills and prepare for Medicare coverage

Nordisk and Eli Lilly They took their battle against the GLP-1 pill to the biggest meeting on obesity this weekend as they prepare for the next sea change in the way patients receive their medications.

Novo Nordisk announced Sunday that prescriptions for the Wegovy pill have surpassed 3 million since it entered the U.S. market about five months ago. The Danish drugmaker's CEO, Mike Doustdar, celebrated the milestone, saying in an interview with CNBC that Novo was able to accelerate prescriptions even as Lilly introduced its own GLP-1 pill in April.

“If that's not acceleration, then I don't know what is,” Doustdar told CNBC this weekend at the American Diabetes Association Scientific Sessions.

Meanwhile, Lilly CEO Dave Ricks told CNBC that prescriptions for its Foundayo pill are “notably higher” than the 20,000 Lilly reported about six weeks ago around the release of its first-quarter results, without giving a specific figure. He said the number is increasing week by week and Lilly is pleased with the progress.

The competition for the diet pills market is just the latest for longtime rivals. Signs of that tension were evident throughout this weekend's industry event. Cars drove around advertising Novo's Wegovy pill, while photographs of Lilly's Foundayo pill covered some of the floors of the New Orleans convention center.

And the two companies will soon defend their daily pills and weekly injections for seniors. Starting in July, millions of people with Medicare will be able to access GLP-1 weight loss drugs for $50 a month. Until now, Medicare beneficiaries have had to pay out of pocket for obesity medications, potentially costing them hundreds of dollars a month. Both companies say they are focused on raising awareness about the program, although they have different proposals.

Doustdar believes the program could be an opportunity to make up some of the ground that Novo's Wegovy shot has lost to Lilly's Zepbound. The drugmaker plans to advertise other health benefits of Wegovy on its label, he said, such as the fact that it can lower the risk of cardiovascular problems such as heart attacks and strokes. He said Novo should win among the elders “if we want common sense to prevail, and I put myself in his place.”

“With the high dose of Wegovy, why not take a product that has the same effectiveness, on a percentage basis, as my competitor?” said. “Plus, you get kidney, liver, heart and stroke protection, let's say for free. I would take it if I were 10 years older.”

Lilly's pitch to seniors is convenience. The Foundayo company's pill can be taken at any time of the day with food, water and other medications, while the Novo pill must be taken on an empty stomach with little water and requires fasting for 30 minutes afterwards.

“The main thing is that it's easy,” Ricks said. “This is something that can be incorporated into your daily routine. Most seniors take a lot of other medications, have their pill case and use it every day, and this will fit right into that without giving it another thought.”

Ricks said Lilly is working closely with the government to prepare and is confident that humanwho will process prescription requests, will do a good job. He believes the program will be popular with older people and that, in the long term, the initiative could help demonstrate that obesity care should be “regular medical care.”

“We have to demonstrate that in this pilot and demonstrate cost-effectiveness and then reestablish what we expect from our health insurance, which is that obesity care should be health care,” Ricks said.

Lilly and Novo are trying to increase insurance coverage of GLP-1 obesity drugs. At least one analysis found the drugs were cost-effective, but employers have refused to pay for them because many people might be eligible for the treatments and many patients stop them after achieving a weight loss goal. Health insurance company Cigna said last week that it would stop covering medications for its own employees.

At Lilly, less than 20% of the company's beneficiaries are using weight-loss drugs, and people continue to take them, Ricks said. Lilly is conducting an internal study to measure its healthcare costs and outcomes such as hospitalization rate, progression to diabetes and cardiovascular events. Lilly plans to publish those results later this year, he said.

As they prepare for Medicare coverage, both companies are trying to introduce more drugs to treat obesity. At this weekend's conference, Lilly presented Phase 3 data for retatrutide, an experimental triple agonist that helped people lose an average of 28% of their body weight when they continued taking the drug. Almost half of the people lost more than 30% of their body weight, an amount similar to that after bariatric surgery. The drug also helped improve related conditions, such as knee osteoarthritis and sleep apnea.

Initially, Ricks expects retatrutide to be used primarily to treat people with higher body mass indexes, or BMIs. He also sees promise in the drug's second-lowest potency. It helped people lose an average of 19% of their body weight with fewer side effects than higher concentrations.

One question was whether Lilly would make retatrutida available on its direct-to-consumer sales platform. LillyDirect once it is approved by the Food and Drug Administration because it is very powerful. Lilly “absolutely” plans to make the drug available there, Ricks said.

For Novo, the next drug on the horizon is called CagriSema. It combines Wegovy's main ingredient with another molecule called cagrilintide, which mimics another hormone called amylin. The drug's effectiveness has disappointed investors, as it has shown weight loss similar to that of Lilly's Zepbound and less than that of Lilly's retatrutide. Doustdar believes the drug's advantage in effectiveness over Wegovy, even if only a few percentage points, is significant, and said he is committed to launching CagriSema. Novo expects an approval decision on the drug from the U.S. Food and Drug Administration in the fourth quarter of this year.

“If I have to forget about CagriSema, I also have to forget about many other products,” said Doustdar. “I don't think it should work that way.”

Doustdar took over as CEO nearly a year ago after a major restructuring that saw the company's longtime leader leave and thousands of employees laid off. His task is to revitalize Wegovy's sales, the company's pipeline and its share price. Over time, he said Novo will be more diversified within the area of ​​cardiometabolic health (such as diabetes and obesity) and some of the “adjacencies.”

Meanwhile, Doustdar said the initial success of the Wegovy pill has helped Novo regain some momentum.

“The pill was a great example of how people trust that we can do this, that at Novo Nordisk, the best days are ahead and not just behind us,” he said. “So we also have to make sure that we turn these positive moments that we are in now into a long-term trend, so that we gain trust day by day and improve that both internally and, of course, externally, and I will work hard to make sure that this continues.”