Eli Lilly’s Popular Weight Loss Drug Zepbound Gets Price Cut

With demand for drugs like Ozempic high and supply tight, a modern market has emerged to meet the needs of customers who don’t have access to them. Dozens of telemedicine companies are offering online prescriptions for cheaper, compounded versions of these drugs. These alternatives come in vials, with syringes to draw each dose, and cost hundreds of dollars less than the brand-name options.

On Tuesday, Eli Lilly announced that it would begin selling petite doses of its weight-loss drug Zepbound in vials as well — at a much lower price than the pens that come with prefilled doses. Those vials will be available exclusively through LillyDirect, a telemedicine platform the company launched in January that connects patients with providers who can prescribe the obesity drug. Like compounded drugs prescribed by online startups, Zepbound vials can be delivered directly to patients’ doors.

The lower price could augment access for many people whose insurance plans don’t cover the powerful weight-loss drug, said Lindsay Allen, a health economist at Northwestern Medicine. As weight-loss drugs have become more popular, some insurers have restricted access to them or stopped covering them altogether to rein in rising costs. Some estimates suggest that millions of patients in turn, they sought cheaper alternatives to those drugs from prescription pharmacies, which can make copies of any drug the Food and Drug Administration lists as “deficient.” That includes tirzepatide, a substance in Zepbound, and the diabetes drug Mounjaro.

Lilly’s announcement also poses an unusual challenge to many telemedicine companies, Dr. Allen and other experts said, and underscores the threat it poses to Lilly’s position in the market.

“Maybe this is a signal to the space: ‘We’re going to take that market share back from you, even if it means lower prices,’” said Dr. Timothy Mackey, a professor at the University of California, San Diego, who has studied the market for counterfeit weight-loss drugs.

The vials are significantly cheaper than Zepbound pens, which cost just over $1,000 a month without insurance. A month’s supply of the 2.5-milligram dose will cost $399, and a month’s supply of the 5-milligram dose will cost $549. The vials could be beneficial for people who don’t have insurance for Zepbound, including those on Medicare, said Patrik Jonsson, executive vice president of Eli Lilly and Company.

Dr. Adriane Fugh-Berman, a professor of pharmacology and physiology at Georgetown University Medical Center, said she worries about the appeal to people on Medicare, which has so far refused to cover weight-loss drugs alone. She noted that the drugs carry unique risks for older patients, including loss of muscle mass, which can make people over 65 more likely to fracture or become breakable.

“Older people don’t have to lose muscle mass,” she said.

Outside experts say the move could support Lilly win back customers who currently get tirzepatid in a combination formulation that costs about $250 to $450 per month.

Lilly positions its vials as a safer option than compounded drugs for people who can’t afford their pens. Compounded drugs are subject to much less oversight than traditionally approved drugs, and health officials have repeatedly warned against taking compounded drugs for weight loss.

“There is no reason for anyone in the U.S. to take a drug that is not approved by the FDA and whose safety, quality and effectiveness are not monitored,” Mr. Jonsson said. “It is simply a way to protect the U.S. population.”

Lilly announced this month that all doses of tirzepatide are now available. The FDA will need to review supplies before removing it from the shortage list.

“Once we are no longer on the shortage list, there should be no room for mass compounders,” Mr. Jonsson said. Lilly has already launched legal battles against prescription pharmacies.

In addition to connecting patients with providers, LillyDirect will now also allow patients with prescriptions from any doctor to purchase vials, needles and syringes directly from Lilly. Patients will have to pay for the drugs themselves; Lilly will not accept insurance to cover the vials. The company said it is able to offer what it called “see-through pricing” for the vials in part because it can sell the drug directly, “eliminating third-party supply chain entities,” according to a press release.

The company will offer vials of only the two lowest doses of Zepbound. Many patients stay on the five-milligram dose, Mr. Jonsson said. But some gradually augment the dose, to a maximum of 15 milligrams. Any patient interested in taking more than five milligrams would have to switch to pens.

But for patients taking lower doses, the company is effectively undercutting itself by offering a cheaper alternative to its own medicine. Mr. Jonsson admitted it was “likely” that patients paying out-of-pocket for Zepbound pens would switch to the cheaper vials. “Will it be 10 percent? 60 percent? We don’t know,” he said.