Sign-ups for Medicare’s GLP-1 coverage plan keep expanding, and Eli Lilly is dominating the market with 70% share, the company’s CEO David Ricks said.
Since its rollout on July 1, the Medicare GLP-1 Bridge has attracted about 700,000 seniors who’ve started treatment, Ricks said in an interview with CNBC.
The demonstration program seems to be expanding rapidly. In an Aug. 31 announcement of a new round of “most favored nation” drug pricing deals with nine biopharma companies, the White House said over 500,000 seniors had utilized the program, and the Centers for Medicare and Medicaid Services Administrator Mehmet Oz, M.D., updated the number to 600,000 during a press conference that day.
“That’s very encouraging, that seniors are talking to their doctors. They want to manage their weight. They understand there’s long-term health consequences,” Ricks said of the program. “It’s very market expansionary, which is what we had hoped.”
The Medicare GLP-1 Bridge was launched as part of the Trump administration’s MFN deals with Lilly and Novo, offering eligible seniors GLP-1 obesity drugs at a $50 per month copay.
During the company's recent Capital Markets Day, Novo’s EVP of U.S. operations, Jamey Millar, also pointed to the Medicare program as a way to expand GLP-1 drugs’ patient base.
Lilly is capturing 7 out of 10 patients on the Medicare program, with many on its Zepbound, Ricks said. The 70% share is higher than the roughly 60% that Lilly owns in the broader obesity field, where Zepbound also takes a leading position.
“I think still we see physicians focusing on those with the most body weight and the most complications. That’s where Zepbound plays a big role,” Ricks said.
As for Lilly’s oral drug Foundayo, which lags Novo’s Wegovy pill in overall market share, Ricks said it’s attracting Medicare patients looking for convenience but not necessarily a huge weight-loss effect. Following its launch in April, Foundayo now captures about 1 out of 3 new starts for oral GLP-1 obesity drugs, and “that’s growing week over week,” according to Ricks.
Lilly is offering its GLP-1 meds to Medicare at a net price of $245 per month. Based on a 70% market share, Jefferies analyst Akash Tewari calculated $1.4 billion in annualized revenue for the Indianapolis pharma. If the program keeps expanding at its current rate, Tewari figured Lilly could exit the year at an annualized run rate of $3 billion to $3.5 billion.
Ricks made the comments as Lilly broke ground on a new, $6.5 billion active pharmaceutical ingredient manufacturing site in Houston to produce Foundayo and other medicines. In his CNBC interview, Ricks touted the Houston facility’s ability to support Lilly’s international expansion for Foundayo.
In another potential inflection point, Foundayo is gunning for an FDA approval in Type 2 diabetes. As Ricks noted, the oral GLP-1 diabetes market is already at the same size as the obesity market.