A 'paradigm shift' in weight loss drug coverage

Wegovy is now approved to be used to reduce the risk of heart attack, stroke and cardiovascular death, which could lead to broader payer coverage of the drug. 

On March 8, The FDA approved Novo Nordisk's weight loss drug to be used for preventing cardiovascular events in adults with cardiovascular disease who are also obese or overweight. 

The approval is a "paradigm shift in obesity treatment and payer coverage," BMO Capital Markets analyst Evan Seigerman wrote in a research note reported by The Wall Street Journal March 8. 

GLP-1 drugs, which include Ozempic, Trulicity, Victoza and Mounjaro, are approved to treat Type 2 diabetes, though these drugs are prescribed off-label for weight loss. Wegovy and Saxenda are approved for weight loss.  

Some health plans and employers have pulled back on coverage for the drugs because of their high costs. GLP-1 drugs can cost $15,000 annually. 

The approval could also lead to broader coverage of Wegovy in Medicare. Federal law currently bars Medicare from covering drugs for weight loss alone, but it could cover the drugs to treat cardiovascular disease. 

"I'm not sure it opens the floodgates, but it would open the door to allow more people on Medicare to gain access to Wegovy," Tricia Neuman, PhD, executive director of KFF's program on Medicare policy, told NPR March 8. 

Legislative efforts to allow Medicare coverage of costly GLP-1 drugs has stalled. A study published in The New England Journal of Medicine in March 2023 found if 10% of people with obesity covered by Medicare were prescribed a brand-name version of semaglutide, the drug would cost Medicare $26.8 billion annually.  

In a March 8 memo, the Congressional Budget Office said the cost of legislation to cover the drugs would decrease if Medicare begins covering GLP-1 drugs for cardiovascular indications. 

"CBO is refining its baseline projection of what new indications are likely to be covered by Medicare under current law and will share more information when it is available," the office said in its memo to lawmakers. 

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