Report Reveals Price Hikes for 700 Drugs, Including Ozempic and Mounjaro

Report Reveals Price Hikes for 700 Drugs, Including Ozempic and Mounjaro
24.01.2024
  • Drug companies are increasing the list prices for more than 700 prescription drugs at the start of this year.
  • The average increase for all brand name drugs was about 4.5%, with Ozempic increasing 3.5% and Mounjaro increasing 4.5%, both anti-diabetes medications.
  • People with insurance coverage for these drugs may not pay the full list price. Drug manufacturers may also offer coupons or savings cards to consumers to offset the price.

Pharmaceutical companies are raising list prices on more than 700 prescription drugs, including popular anti-diabetes medications Ozempic and Mounjaro, which are also used off-label for weight loss, a new analysis shows.

The average price increase for all brand name drugs was about 4.5% at the start of this year, a report from 46brooklyn showed.

This is slightly lower than the previous five years, when drug prices increased on average about 5% each year, the analysis shows. It’s also lower than the 7% to 9% average increases seen in earlier years.

In line with this, the price of Novo Nordisk’s Ozempic rose 3.5% to $979 for a month’s supply, according to the report. The company told Healthline that it “increases the list price of some of our medicines each year in response to changes in the healthcare system, market conditions and the impact of inflation.”

Similarly, the price of Eli Lilly’s Mounjaro increased 4.5% to $1,069.08 for one month’s supply. “Our goal is to provide our treatments at a price appropriate for the overall value of the medicines and considering the medicines’ efficacy and safety profile,” the company told Healthline.

Consumers may not pay full price

Both drugs are approved as treatments for type 2 diabetes, and help regulate blood sugar. They belong to a class of medications called GLP-1 receptor agonists. Mounjaro also activates another receptor called GIP, which assists with blood sugar control.

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The drugs have also been shown to be effective weight-loss drugs, so are sometimes prescribed off-label for that purpose. Semaglutide, the compound in Ozempic, is approved separately for weight loss under the brand name Wegovy.

These are list prices, or wholesale acquisition costs. People with prescription coverage for these drugs through commercial or government insurance may pay a lower price. Companies may also offer coupons or savings cards to consumers to further lower the cost of the drug.

“The list price … is not representative of the out-of-pocket costs for most insured patients,” Novo Nordisk said. “That’s because after we set the list price, we negotiate with the companies that pay for our medicines (called payers) to ensure our products remain on their formularies so patients have access to our medicines.”

Payers work directly with health insurance companies to set prices and the out-of-pocket co-pay amounts.

“While these increases are challenging for many reasons, it is not likely to impact most commercially insured patients, as these patients typically pay a co-pay,” said Dr. Angela Fitch, chief medical officer at knownwell and current president of the Obesity Medicine Association.

However, “it does impact those patients with a high deductible and those that are on Medicare the most,” she told Healthline.

Medicare does not cover Ozempic and Mounjaro when used for weight loss. A bill introduced in the U.S. House of Representatives last year, the Treat and Reduce Obesity Act of 2023, aims to allow Medicare to pay for weight-loss drugs for the first time.

High demand for weight-loss drugs

Given the effectiveness of these drugs for type 2 diabetes, and the cardiovascular benefits seen in people taking these types of medications, Fitch doesn’t think health insurers will drop coverage of these drugs.

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However, “employers should advocate for PBM [pharmacy benefit management] rebate reform, so that these drugs can be priced closer to their price in other countries,” she said.

PBMs negotiate with drug manufacturers to obtain discounts for insurers and employers. Some members of Congress blame PBMs for causing the rise in drug prices. Rising rebates demanded by PBMs from manufacturers have also been linked to rising list prices.

Ellen Kelsay, president and CEO of Business Group on Health, a non-profit organization representing large employers, said the high consumer demand for GLP-1s is expected to lead to considerable increases in healthcare costs for employers with self-funded insurance plans.

“The medications are expensive, and with over 40% of the U.S. population being overweight and/or struggling with obesity, the number of patients who could potentially be prescribed these medications is extremely high,” Kelsay told Healthline.

“The cost of the medications, coupled with their widespread use — for the treatment of both diabetes and obesity — could create a challenging financial situation for the employer-sponsored plans as well as for patients,” she said.

Some groups of consumers may be impacted more by the high list prices of these drugs, such as marginalized and/or lower-wage populations, said Kelsay, especially if they are uninsured or have health insurance that does not cover these medications.

With drug prices in the United States significantly higher than in other countries, another concern is that people concerned about cost will seek out alternatives.

“[High drug] prices in the U.S. drive consumers to use unregulated, untested and potentially-harmful knock-off compounded versions of these drugs,” said Fitch, “which is a real problem that we need to take very seriously in our country.”

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Earlier this year the Food and Drug Administration warned consumers not to use counterfeit Ozempic, which was found in the country’s drug supply. These counterfeit drugs carry the risk of infection from unsterile needles and other harmful effects, the agency said.

Takeaway Note

The list price of more than 700 prescription drugs is increasing at the start of this year by an average of around 4.5%. Included in this is a 3.5% increase in the price of Ozempic and a 4.5% increase in Mounjaro.

Ozempic and Mounjaro are approved as anti-diabetes medications, but are prescribed off-label for weight loss. They belong to a class of medications known as GLP-1 receptor agonists. Mounjaro also activates another receptor known as GIP.

People with prescription coverage of these medications may not pay the full list price. Instead they may pay a lower amount determined by their insurer. Coupons or savings cards may also be available from manufacturers to offset the price.

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