White House Announces Agreements with Drugmakers to Lower Obesity, Diabetes Drug Costs
WASHINGTON – The Trump administration announced new agreements with pharmaceutical companies Eli Lilly and Novo Nordisk yesterday, aiming to lower the cost of popular Type 2 diabetes and obesity medications for some Americans.The deals focus on drugs including Ozempic, Mounjaro, Wegovy, and Zepbound, and seek to expand access while simultaneously controlling healthcare costs.
Under the agreements, Medicare beneficiaries will be able to access these medications with a monthly copay capped at $50. The lowered prices coudl also lead to expanded coverage for obesity drugs under Medicaid, which currently doesn’t always include them.
Dr. Mehmet Oz, head of the Centers for Medicare and Medicaid, stated the administration anticipates the agreements will be “budget-neutral” within two years, suggesting healthcare savings from improved patient health will offset the reduced drug prices. “By the time the ink dries on these contracts that were signed earlier today,within two years,based on our health improvements,these drugs will not cost us money. The American taxpayers will be getting their money back,” he said.
The agreements also extend to individuals who purchase the drugs directly from the companies without insurance.For example,the starting monthly cost of Zepbound will decrease from approximately $350 to $300.
Health economist Geoffrey Joyce, director of health policy at the USC Schaeffer Center, believes the deals benefit the pharmaceutical companies as well. “I think the manufacturers were open to this partly for political reasons, but also it was just going to expand their patient population dramatically,” he explained, noting the increased patient base will likely translate to higher overall revenue.
The American Medical Association has praised the proclamation, calling it a “transformative step” in addressing chronic disease and obesity.
Beyond price reductions, the agreements include a commitment from the drugmakers to launch any new medications in the U.S. at prices comparable to those in other developed countries.
