A fresh agreement with prominent pharmaceutical companies, disclosed by U.S. President Donald Trump on Thursday, is aimed at broadening coverage and reducing costs for popular weight-loss medications in the southern region. The pact with Eli Lilly and Novo Nordisk is designed to extend Medicare coverage for Zepbound and Wegovy, two medications belonging to the GLP-1 receptor agonist category. GLP-1 agonists, which encompass semaglutide medications like Wegovy and Ozempic, are a group of drugs that mimic the GLP-1 hormone to address diabetes and obesity by triggering insulin release, slowing stomach emptying, and curbing appetite.
In the United States, access has been limited due to inconsistent insurance coverage and high prices, reaching up to $500 per month for higher dosages. Hence, the real impact of Trump’s announcement in reducing costs remains to be seen. Will Canadians also reap the benefits?
The drug coverage expansion is slated to commence next year, as per a senior official in the Trump administration, for individuals with severe obesity or other weight-related health issues. Eligible individuals will have a $50 copay. Furthermore, lower prices will be phased in for those lacking coverage through the TrumpRx initiative, allowing direct purchase from manufacturers starting in January. Initial drug prices on TrumpRx are estimated to start at approximately $350, decreasing to $245 over the following two years.
While these reductions seem significant, Canadian pricing is already comparatively lower. Taking exchange rates into account, GLP-1 drug prices are notably lower in Canada, noted Dr. Nisha Gupta, an endocrinologist and postdoctoral fellow at McGill University.
In Canada, prices may witness a further decline in the upcoming year due to reasons independent of the U.S. deal. Currently, Canadians pay between $300 and $500 monthly for GLP-1 medications, encompassing semaglutide brands like Ozempic and Wegovy. In January, Novo Nordisk, the manufacturer of these semaglutide brands, could potentially lose market exclusivity in Canada, potentially allowing generic versions to enter the market. Mina Tadrous, an associate professor at the University of Toronto specializing in pharmaceutical pricing, estimates this could reduce prices from $400 to under $100 for the same strength of semaglutide product.
However, the type of generic version that will be available remains uncertain, given the varying doses and costs associated with semaglutide for different conditions.
Despite the price drops, the popularity of GLP-1 medications remains high among the public and poses a notable cost to provincial drug plans. Between 2017-18 and 2022-23, total prescription drug spending for Canada’s public drug plans surged by over $3 billion, surpassing $14 billion. Three antidiabetic medications, including Ozempic, were among the high-impact drugs, collectively contributing nearly two percent to the growth in drug costs. Ozempic alone has over 200,000 beneficiaries nationwide, as per a federal report.
The affordability of these medications could potentially lead to increased demand among Canadians, including for off-label uses when not covered by private insurance plans. Some patients choose to pay out-of-pocket for GLP-1 drugs, with Wegovy not covered by provincial governments in Canada but potentially covered by private insurance plans based on specific criteria.
In the event semaglutide becomes generic, it could enhance accessibility for patients struggling with weight issues, according to Dr. Gupta. However, the decision to prescribe these drugs for unapproved uses will ultimately depend on individual physicians.