On May 13, Sen. Bernie Sanders (I-Vt.) published an open letter to Novo Nordisk on the front page of a number one Danish newspaper, urging the Danish company to live as much as its altruistic standards and lower U.S. prices for its successful diabetes and weight-loss drugs.
What Sanders didn't know was that Denmark, a rustic of six million people, was fighting its own crisis over the financing of Novo Nordisk's drugs Ozempic and Wegovy.
Most other developed countries, including Denmark, negotiate drug costs for his or her residents and pay prices which might be a fraction of those within the United States. But if a drug is effective and expensive, pharmaceutical corporations can clamp down on pricing. And Novo Nordisk did so, not less than initially, pushing the Danish health care system to its limits.
The country's public health system had adopted Ozempic as a diabetes drug for years, but in 2022 doctors began prescribing it for weight reduction as well, and shortly “they emptied all the coffers of the entire public health system,” said Jens Juul Holst, a professor on the University of Copenhagen and co-inventor of the drug.
Countries all over the world are fighting how and when to pay for Ozempic, Eli Lilly's Mounjaro and other drugs in the identical chemical class, especially when prescribed for weight reduction. In fact, the astronomically high prices within the U.S. set a bar that pharmaceutical corporations can use of their negotiations with other health systems.
In Denmark, where prescriptions for these drugs will devour 18 percent of the regional pharmaceutical budget in 2023, officials considered the unthinkable in a system that prides itself on free cradle-to-grave care: forcing patients to pay for Ozempic—a drug manufactured within the country—out of their very own pockets.
In America, stricter insurance policies are making it increasingly difficult for patients to acquire the medications, which may cost as much as $1,350 a month.
“In our clinic, there are month-to-month changes in terms of care, coverage and available drugs,” said Michael Blaha, director of clinical research on the Johns Hopkins Ciccarone Center for the Prevention of Cardiovascular Disease. He said doctors and patients play “a constant game of prior authorizations and appeals.”
The use of the drugs for weight reduction is a very sensitive issue. Novo Nordisk and Lilly are fighting for reimbursement – backed by some doctors and patient groups, lots of whom are funded by the drug corporations. They are pushing to overturn a 2005 federal regulation that prohibits Medicare from reimbursing weight-loss treatments.
“There's a strong likelihood that Medicare will cover these obesity drugs sooner or later,” said David Kim, an assistant professor of drugs and public health on the University of Chicago. If Medicare pays, he added, private insurers will likely follow suit.
The impact on government and personal insurance budgets, he said, depends upon three unanswered questions: How many individuals will ultimately get the drugs? How long will they take them? And at what cost?
The potential Medicare market alone is big. In 2020, about 13.7 million Medicare beneficiaries, a few quarter of the entire, were diagnosed as obese or obese, in keeping with Juliette Cubanski and Tricia Neuman, researchers at KFF, a nonprofit health information organization that features KFF Health News. Assuming a 50% discount on Wegovy's $1,300 monthly list price, that involves $107 billion. The total federal share of Medicare Part D spending in 2024 has been estimated at $120 billion.
Novo Nordisk has spent $7.6 million lobbying Congress over the past 12 months, and lobbying disclosures show that the vast majority of that cash was used to push bills within the House and Senate to expand the usage of GLP-1 drugs.
The pressure from pharmaceutical corporations is relentless. Pfizer, which has a GLP-1 drug in development, commissioned a white paper from the consulting firm Manatt arguing that Medicare law already allows coverage of those obesity drugs because they provide advantages beyond weight reduction. Novo and other pharmaceutical corporations have funded studies showing that taking these drugs results in savings in health look after chronic diseases.
But the Congressional Budget Office, whose estimates of the prices of such measures are crucial as to whether they’re ultimately implemented, has not yet issued a final statement. In a presentation in March, the office said it was “not aware of any empirical evidence directly linking the use of obesity drugs to reductions in other health care spending.”
Prime Therapeutics, a pharmacy reimbursement manager whose clients are employers that sponsor drug plans, released a study this 12 months that found that only a 3rd of patients who take a GLP-1 drug take it for a full 12 months. That means getting insurance firms to cover the drugs can sometimes be a waste of cash, said Patrick Gleason, chief research officer at Prime Therapeutics, because research shows that patients are likely to regain weight after stopping the drugs.
This does not likely surprise Danish scientist Holst. He says that for many individuals, appetite suppression through GLP-1 drugs is “so miserably boring that they can no longer stand it and have to go back to their old lives.”
One answer could possibly be weight reduction programs that use GLP-1 for a 12 months, for instance, followed by maintenance therapy with cheaper drugs, Kim says.
Either way, many experts in the sector say it is sensible to start out shedding weight before obesity-related chronic diseases equivalent to type 2 diabetes develop.
Because obesity is related to so many comorbidities, pharmaceutical manufacturers are currently conducting studies showing that GLP-1 drugs even have a positive effect on conditions equivalent to sleep apnea and heart, liver and kidney disease.
But even those that support the usage of these drugs acknowledge that there’s uncertainty about how long it takes for the health-promoting effects to take effect and whether shorter-term use can prevent or alleviate longer-term illnesses.
“Modeling the impact is complicated,” says Alison Sexton Ward, a researcher on the Schaeffer Center for Health Policy and Economics on the University of Southern California. “Medical costs will not fall immediately. The diseases prevented may not appear for years.”
Starting next 12 months, out-of-pocket costs for Part D Medicare enrollees can be capped at $2,000, meaning U.S. taxpayers could have to cover most Medicare drug costs. So it's no surprise that the Congressional Budget Office expects the administration to start Medicare price negotiations for semaglutide under the Inflation Reduction Act “within the next few years,” in keeping with its March presentation.
Under the terms of the law, Ozempic could possibly be subject to cost negotiations by the federal government as early as next 12 months, with recent prices taking effect in 2027. The negotiated unit price would apply to all types of the drug – Ozempic, its higher-dose weight-loss version Wegovy, and a pill called Rybelsus.
It is unclear how high the worth can be. Wegovy costs patients in Denmark as much as $365 a month, which normally doesn’t cover the fee of the drug – and about 140 $ in Germany and $92 within the UK
Meanwhile, generic drugmakers are preparing to sell their versions of semaglutide, that are expected to hit the market in China and Brazil as early as 2026. In the U.S., Americans will likely must wait until not less than 2032 because of patent restrictions within the U.S. The Federal Trade Commission has sought to shorten the drugs' exclusivity periods by difficult Novo Nordisk's patent applications for applicators used to inject the drugs – which might extend their market exclusivity to as much as 30 months.
Currently, patients who cannot afford or don’t have access to the drugs often resort to ready-made preparations that will not be FDA-approved, although their raw materials come from FDA-registered factories. Blaha has “a number of patients” who don’t have access to the brand-name drugs and are available to the clinic with vials of ready-made preparations.
Two weeks before Sanders published his letter in Denmark, Novo Nordisk cut the local price of Ozempic by 34 percent to $130 a month – about 15 percent of the U.S. list price. The government, which had threatened to stop covering the drug, agreed to cover the fee of Ozempic diabetes treatment, but just for patients who had previously tried a less expensive drug equivalent to metformin.
Wegovy, the identical weight-loss drug in higher doses, would must be paid for by the patient in just about all cases. The monthly cost is $365. That price, while moderate by U.S. standards, has sparked heated debate in regards to the unequal impact of social class on the affordability of the drug, says Nils Jakob Knudsen, an endocrinologist in Copenhagen.
Calculating drug prices is complex for the Danes, he added, because “the booming economy for Novo also drives our very healthy Danish economy.”
Novo Nordisk's market valuation of $591 billion on August 2 was significantly higher than Denmark's entire GDP.
©2024 KFF Health News. Distributed by Tribune Content Agency, LLC.
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