Ozempic and Wegovy prices questioned as Novo Nordisk faces US Senate hearing

The CEO of Novo Nordisk was grilled during a US Senate committee hearing on September 24, 2024, in which the exorbitant prices of the Danish company’s blockbuster drugs Ozempic and Wegovy were called into question. 

CEO Lars Jørgensen was questioned for almost 2 hours by the Senate Committee on Health, Education, Labor, and Pensions (HELP) on the US pricings for GLP-1 receptor agonists Ozempic, indicated for diabetes, and Wegovy, indicated for obesity and weight loss. One of the biggest points brought up was the difference in pricing for the drugs in the US compared with pricings abroad. Currently, Novo Nordisk charges US$969 for Ozempic in the US, compared with US$155 in Canada and US$59 in Germany. Wegovy is even higher, at US$1349 per month, while in Canada and Germany, it is US$265 and US$137 respectively. The main point of content between the Senate and Jørgensen was the role and impact of pharmacy benefit managers (PBMs) on drug pricing. 

Jørgensen stated that the listed prices for the semaglutide products was “just a starting point of the negotiations” with PBMs. Claims were made regarding the favouring of drugs with higher listed prices on formularies. Dropping these listed prices would often lead to narrower insurer coverage due to this incentivisation of larger rebates. The company’s CEO also claimed that due to the complicated US health coverage system, listed prices are based on rebates that the company must pay to PBMs in the US as well as programmes such as Medicare. As a result, Jørgensen claims that Novo Nordisk does not ultimately control the final price patients will pay for these medications, as determined by insurance companies. 

As a final statement, Jørgensen stated that if the US uncoupled PBMs and their income from listed prices, there would be incentives for companies to lower their drug costs in the US. However, US Senator Bernie Sanders offered a different assessment of the role of PBMs. “I have received commitments in writing from all of the major PBMs that if Novo Nordisk substantially reduced the list price for Ozempic and Wegovy, they would not limit coverage,” Sanders declared. “In fact, all of them told me they would be able to expand coverage for these drugs if the list price was reduced.” Though Sanders praised the semaglutide drug products as “transformative new treatments”, he accused Novo Nordisk for using the US as a “cash cow”.  

During questioning, Jørgensen did not directly address questions related to the higher pricing in the US, instead commenting on the company’s focus on discovering revolutionary medicines as well as improving manufacturing and capacity. He stated that “this ensures that [their] time and resources are focused on unlocking cures for chronic diseases, not on daily stock fluctuations.” Regarding the prices themselves, Jørgensen mentioned both Novo Nordisk’s patient assistance program in helping qualified patients access Type 2 diabetes medications, and also stated that most Americans pay US$25 at pharmacies for a month’s supply of their drugs. However, other US Senators such as Ben Luján question the need for such programmes if the company simply listed the ‘coupon’ price instead of giving those who couldn’t afford the medications a coupon. Lowering the listed price of Ozempic and Wegovy became a continuing line of questioning, with US Senator Maggie Hassan directly asking “Would you please commit to lowering the list price of these drugs?” The answer given by Jørgensen remained the same each time: “Anything that helps patients get access and affordability, we are in support of,” with no clear commitment given. 

Yet, some US Senators such as Mitt Romney and Tim Kaine offered counterpoints to the calls for lower prices. Romney pointed to policies in the US that emphasise profit over all else for companies in the US, though he still questioned Jørgensen on the disparity between the US and the rest of the world in terms of drug pricing. Kaine drew attention back to PBMs as the largest hindrance to lower prescription drug prices – as intermediaries negotiating drug costs with pharmaceutical companies before passing these savings on to insurers, PBMs make most of their profit from rebates or by up-charging the drug products. Kaine criticised these entities as a “huge part of this problem that afflicts the everyday Americans trying to afford prescription drugs.” 

On the issue of PBMs, Jørgensen stated “I don’t know under which conditions such a promise [of lowering prices] comes. I haven’t seen any of that. I will collaborate with the PBMs and would be happy to do anything that helps patients... It is not our intention that anyone should pay the list price.” 

Sources: 

1. US Senator Sanders says middlemen won’t punish Novo if it cuts weight-loss drug prices [Accessed September 24, 2024] https://www.reuters.com/business/healthcare-pharmaceuticals/novo-nordisk-ceo-faces-us-congress-scrutiny-over-weight-loss-drug-pricing-2024-09-24/  

2. Ozempic and Wegovy drugmaker treating US as its ‘cash cow’, Sanders says [Accessed September 24, 2024] https://www.bbc.co.uk/news/live/c04p5916k4xt