Eli Lilly garnered widespread praise Tuesday for launching discounted versions of its blockbuster obesity drug Zepbound. Before, the treatment had only been sold in injectable pens for a list price of $1,060 per month, but now, Lilly will also sell starter doses in vials that cost up to $549 a month, “expanding supply and access,” the company said.
In Lilly’s press release, one patient group called it “an innovative solution that brings us closer to making equitable care a reality.” And even President Biden chimed in on X, crediting his administration’s work on pressuring drugmakers to lower prices.
But a deeper look at the announcement suggests the new offering may not expand access as much as the company indicates.
Doctors noted that the price of the vials will still be out of reach for many patients, and only the starter doses will be offered in the vials, not the higher doses that many patients need to achieve significant weight loss. Additionally, not all patients will be able to pick up vials; they will only be available to patients who are paying for their own medication without insurance and who exclusively order through Lilly’s online portal.
On the same day Lilly launched the vials, it also quietly increased costs for other patients. Before, people who have commercial insurance but don’t have coverage for Zepbound could apply for a savings coupon to get the pens, at whichever dose, for $550 a month, but on Tuesday Lilly raised that price to $650 a month — a move that wasn’t mentioned in the press release.
Lilly also appeared to have made a similar change to its savings coupon for Mounjaro, the sister diabetes drug, based on changes made to its webpage.
Experts said that, while the price of the new vials is a good step, Lilly’s actions, taken together, signal its primary interest is in expanding its market share and reaching patients it previously could not. In this case, the company is specifically aiming to draw in patients on Medicare, who have to pay for Zepbound on their own since Medicare doesn’t cover weight loss treatments and doesn’t allow beneficiaries to use drug coupons.
“When drug companies make these sorts of announcements, you have to be skeptical that they’re doing it for the best interests of patients and prescribers,” said Benjamin Rome, an assistant professor of medicine at Harvard University who researches drug pricing. Like all other for-profit companies, “they’re doing it for the best interests of themselves in order to maximize their revenue and their profits, and that’s what they’re incentivized to do.”
Lilly did not immediately respond to a request for comment. On Tuesday, the company said patients who have already been on the savings coupon will be able to continue accessing the drugs for $550 a month through the rest of this year, but new patients will have to pay $650 a month.
The company said this will help maintain the sustainability of a different savings program from Lilly that allows people with commercial coverage of Zepbound to get the drug at $25 a month.
Changes to the savings coupon
Commercial health plans have been reluctant to cover Zepbound, due to concerns that its high price, coupled with the large number of people eligible for the treatment, would create too much financial strain. So Lilly has been offering a savings coupon for the many patients on the plans that don’t cover Zepbound.
But on Tuesday, when Lilly increased the price of Zepbound pens offered through the coupon, it did not announce the change along with news of the vials. Instead, it modified the fine print on the webpages for the coupons.
Eagle-eyed patients called out the new price online, and Senate health committee chair Bernie Sanders mentioned it in a statement Tuesday: “The good news is that Eli Lilly lowered the list price for the starter dose of Zepbound…The bad news is that Eli Lilly raised the cost that Americans have been paying for Zepbound under its patient assistance program from $550 to $650.”
Christopher Scannell, a health services researcher at the USC Schaeffer Center, said “it would have been more above board and a good faith effort if they had announced both [the vial news and coupon change] simultaneously. I think it’s important for the public at large and then the patients specifically using these medications to have full transparency on the cost of the meds.”
Vials still out of reach for many
Lilly’s decision to price the new vials lower than the pens is “a step in the right direction,” Scannell said. But he noted that the price tag of around $550 a month for vials can still be a big burden for patients.
That’s equivalent to an average monthly payment on a used car, and can be unattainable for some patients, especially for the Medicare population being targeted with the vials, since many beneficiaries are retired and don’t have a stream of disposable income. (For Lilly, the lower price of the vials isn’t likely to financially impact the company much, as it looks to be in line with the net price of the pens, which is the actual revenue that Lilly gets from the pens after rebates, according to Evercore analyst Umer Raffat.)
It’s also not clear how many patients will actually stay on the vials, which only go up to a dosage of 5 mg. Lilly argues that patients can still lose a significant amount of weight at that dose, but Reshma Ramachandran, an assistant professor of medicine at Yale University, said that in her practice, most patients on Zepbound advance to the higher doses that are now only offered in the pens.
If patients need to move to those higher doses, they will either have to use the coupons, if they’re on commercial insurance, or pay the full list price, if they’re on Medicare.
Rome said Lilly’s actions suggest that “they’re not doing this as some sort of good faith effort to lower the price of their product. They’re doing this to expand their market share to a group of patients who want access to the medicine, are willing to pay $500 a month, and don’t have insurance coverage.”
Access to vials only through LillyDirect
Lilly is only offering the vials through its direct-to-consumer platform, LillyDirect. Patients can get an on-label prescription from any doctor, but then they must put in an order on the portal, and the order will be fulfilled by a pharmacy Lilly partners with, such as Truepill or Amazon Pharmacy.
Ramachandran said it’s in Lilly’s interest to bring more patients onto its platform, which can also introduce them to resources for other Lilly drugs, such as migraine and diabetes treatments. The approach also allows Lilly to collect more information on patients, helping the company with targeted marketing, she said. “It’s a great marketing strategy.”
Rome argued that, were Lilly’s primary concern about access, it could have made the vials accessible through many channels, not just its own platform. For example, Lilly could have offered the lower-priced vials to commercial payers, so that plans could expand coverage of Zepbound for their beneficiaries.
“They could have lowered the price on pens. They could have made the vials available to everybody, including insured patients,” Rome said. “There are any number of moves they could have done that would have signaled that they really want to lower the cost.”