U.S. Senator Bernie Sanders intensified pressure on Novo Nordisk (NVO) to lower the prices of its popular diabetes and weight-loss drugs, Ozempic and Wegovy, during a Senate hearing. Sanders revealed that major U.S. pharmacy benefit managers (PBMs) including Optum, CVS (CVS) Caremark, and Cigna’s (CI) Express Scripts have committed to expanding coverage of these medications if Novo reduces their list prices. This contradicts the pharmaceutical industry's frequent argument that price cuts would lead to less coverage due to smaller rebates.
At the hearing, Sanders criticized Novo Nordisk CEO Lars Jorgensen for charging U.S. consumers significantly more than those in other countries. While Americans pay over $1,000 per month for these drugs, some European countries pay as little as $59 for Ozempic and $92 for Wegovy. Jorgensen, while acknowledging that insured U.S. patients pay less due to rebates, did not commit to price reductions, expressing doubts about PBMs’ promises to expand coverage.
Market Overview:- Novo Nordisk is under pressure to reduce the list prices of its weight-loss drugs Ozempic and Wegovy in the U.S.
- Major U.S. PBMs, including CVS Caremark and Cigna's Express Scripts, have committed to maintaining or expanding coverage if prices drop.
- Senator Sanders criticized Novo Nordisk for charging significantly higher prices in the U.S. than in European countries.
- Bernie Sanders secured commitments from major PBMs to expand coverage if Novo Nordisk reduces the prices of Ozempic and Wegovy.
- Novo Nordisk CEO Lars Jorgensen did not commit to lowering the prices despite the PBMs' assurances.
- Prices of Ozempic and Wegovy are dramatically higher in the U.S. compared to Europe, with monthly costs exceeding $1,000.
- Ongoing pressure from U.S. lawmakers could lead Novo Nordisk to reconsider its pricing strategies for these drugs.
- The collaboration between PBMs and pharmaceutical companies will be key in making essential medications more affordable.
- The outcome of these negotiations may set a precedent for other pharmaceutical companies facing similar pricing scrutiny in the U.S.
Despite pressure from Sanders, Jorgensen remained non-committal about price cuts. The CEO pointed out that 99% of U.S. insurance plans cover Ozempic, and around half cover Wegovy, but Sanders insisted that even after rebates, U.S. prices are significantly higher than in other countries. Jorgensen expressed skepticism about PBMs’ role in making these drugs more affordable.
Looking forward, Novo Nordisk’s pricing strategies are under the microscope as the pharmaceutical industry faces growing scrutiny over drug prices in the U.S. Sanders' commitments from PBMs may prompt wider industry changes, though the company remains cautious about altering its approach. The negotiations between PBMs and pharmaceutical companies will likely set the tone for broader discussions on affordability in the U.S. healthcare market.
