The Battle for Affordable Weight Loss Treatments: A Controversial Move by Trump?
In a dramatic turn of events, shares of leading weight loss drug manufacturers, including Novo Nordisk and Eli Lilly, took a significant hit on Friday. The reason? U.S. President Donald Trump's bold statement about lowering the price of Novo's popular Ozempic treatment. But here's where it gets controversial: Ozempic, primarily approved for diabetes, has become a widely used off-label treatment for obesity in the U.S., raising questions about its pricing and accessibility.
Novo's shares plummeted to a near three-week low, with a substantial 6.3% drop. Rival companies like Eli Lilly and Zealand Pharma also witnessed a decline in their stock prices, creating a worrying scenario for investors. Kevin Gade, Chief Operating Officer at Bahl & Gaynor, expressed concerns about the potential impact on the obesity treatment landscape.
During a White House event, Trump announced a deal with Germany's Merck to reduce the cost of drugs for in-vitro fertilization, but it was his comment about Ozempic that caught everyone's attention. When asked to clarify, Trump stated, "I was referring to Ozempic... the fat loss drug?.... They'll be much lower." He previously claimed that under his administration, the price of Ozempic would drop from $1,300 to $150.
However, there's more to this story. Mehmet Oz, who heads the Centers for Medicare and Medicaid Services, clarified that negotiations for the GLP-1 class drugs, including Ozempic, Wegovy, and Lilly's Mounjaro, are still ongoing. Courtney Breen, an analyst at Bernstein, believes Trump's statement may be a strategic negotiating tactic, setting a precedent for future oral obesity drug launches.
"We're witnessing a private negotiation unfold publicly," Breen said. "The $150 price is not yet final."
The question remains: Is Trump using this as a negotiating tactic or does he genuinely believe in this price reduction? Bahl & Gaynor's Gade raises this intriguing point.
Novo and Eli Lilly confirmed they are in discussions with the Trump administration regarding the "most favored nation" order, but details remain scarce. UBS analysts mentioned they had already considered potential U.S. price cuts in their forecasts, suggesting they might be prepared for this development.
This story highlights the complex dynamics between politics, healthcare, and the pharmaceutical industry. As we await further developments, one thing is clear: the future of obesity treatment pricing is a topic that deserves our attention and discussion. What are your thoughts on this controversial move? Feel free to share your opinions in the comments!
