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US Senator Sanders optimistic Novo Nordisk can be pressured to cut Wegovy, Ozempic prices

Published 07/10/2024, 05:18 PM
Updated 07/11/2024, 08:51 AM
© Reuters. FILE PHOTO: U.S. Senator Bernie Sanders (I-VT) gestures while delivering remarks on lowering healthcare costs, in the Indian Treaty Room of the Eisenhower Executive Office building, at the White House complex in Washington, U.S., April, 3, 2024. REUTERS/E
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By Ahmed Aboulenein

WASHINGTON (Reuters) -Senator Bernie Sanders on Wednesday expressed confidence that Novo Nordisk (NYSE:NVO) can be convinced to cut the U.S. prices of its popular Ozempic and Wegovy drugs used for weight loss by publicly shaming the company over how much it charges compared with prices in other countries.

Novo Nordisk CEO Lars Jorgensen is set to testify before the Senate Committee on Health, Education, Labor and Pensions (HELP), which Sanders chairs, in a September hearing focusing on U.S. prices for Ozempic and Wegovy.

"I think we got a real shot, and I was pleased to see President Biden supporting that effort," Sanders told Reuters in a phone interview.

The strategy worked for Sanders last year when he took on Novo, Eli Lilly (NYSE:LLY) and Sanofi (NASDAQ:SNY) over the high price of insulin. All three companies announced they were cutting prices ahead of a scheduled HELP committee hearing following months of pressure.

"I think the major thing that we can do, and we've done this successfully in the past with insulin, ... is to put a focus on the greed of the pharmaceutical industry in general, and Novo Nordisk in particular, in terms of them ripping off the American people," Sanders said.

A Novo Nordisk spokesperson said the net prices of both drugs - how much the company actually received - has dropped 40% since the drugs' launch but those savings do not make their way to consumers, which the drugmaker blamed on pharmacy benefit managers in a letter to the committee. Sanders said that price drop was not enough.

Pharmacy benefit managers act as middle men between drug companies and consumers.

More than 80% of Americans with insurance pay $25 or less per month for the drugs, the Novo Nordisk spokesperson said.

Sanders said people paying that amount continue to be affected by the high prices because insurance companies still pay a lot for the drugs, which drives up insurances prices as well as hospital costs.

"It is very hard for any company, especially one that is making record-breaking profits, to defend itself when they are charging the American people many times more for the same exact drug than they charge people in other countries," Sanders said.

Sanders wants to see Novo reduce the price of Ozempic in the United States to around $155, the drug's price in Canada.

A month's supply of Novo's diabetes drug Ozempic, which has the same active ingredient as Wegovy and is used off-label for weight loss, carries a U.S. list price of $935.77, while Wegovy lists for $1,349.02 per month, according to the drugmaker's website, although most consumers pay less.

Unparalleled demand for newer weight-loss drugs from Novo and Lilly has led to a surge in the companies' share prices, making them among the world's most valuable companies.

Sanders acknowledged that he was currently focused on Novo Nordisk because it makes what is on track to become the most profitable drug in history, but said he will "certainly" get to Eli Lilly, which sells rival drugs Mounjaro and Zepbound, describing their prices as "outrageous."

Mounjaro and Zepbound list for about $1,100 per month.

Some analysts have forecast the total market for weight loss drugs will exceed $100 billion by the end of the decade.

"Eli Lilly is a big player as well. We know that, so we're not prejudiced against Novo," Sanders said.

PBMS ALSO IN CROSSHAIRS

Sanders said he plans to introduce legislation that expands the maximum number of drugs eligible for Medicare price negotiations to 50 a year from 20 and extends the annual $2,000 cap on out-of-pocket costs to Americans outside of Medicare. He said he hopes to secure bipartisan support for the measures.

President Joe Biden called for both provisions in his State of the Union address earlier this year.

Sanders also plans to look at pharmacy benefit managers - which set which drugs are covered by insurance and at what price and which pharmaceutical companies blame for the high cost of prescription drugs - but said drugmakers could not use them as an excuse.

"To say that PBMs play a negative role is true, but notwithstanding that ... (the drug companies) are still ripping off the American people," said Sanders.

Novo Nordisk has not engaged constructively with the Senate committee, Sanders said. The company announced its CEO would testify before the Senate committee following a threat of subpoena by Sanders.

© Reuters. FILE PHOTO: U.S. Senator Bernie Sanders (I-VT) gestures while delivering remarks on lowering healthcare costs, in the Indian Treaty Room of the Eisenhower Executive Office building, at the White House complex in Washington, U.S., April, 3, 2024. REUTERS/Evelyn Hockstein/File Photo

Novo Nordisk has offered to hold briefings for the committee staff, the company spokesperson said, but no briefings were scheduled. It also sent a 22-page letter responding to the committee's questions, the spokesperson said.

"Novo, in all of their press releases, keep saying they want to work in a constructive way with elected officials. They're not," said Sanders. "They have not come back to us with anything constructive."

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