Economists warn of costs if US Medicare covers New Obesity Drugs

Health economists have warned that the cost of expanding U.S. Medicare prescription drugs coverage to cover expensive new obesity medications could prove fatal.

After achieving weight loss of over 20% in clinical trials, big-selling diabetes drugs were repurposed to treat obesity. Although they are more effective than older drugs in terms of weight loss, it might take longer to maintain that weight.

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After discounts and rebates, once-weekly injections with Novo Nordisk’s Wegovy cost more than $13,000 annually in the U.S. Mounjaro, a drug from Eli Lilly and Co that is expected to be approved by the U.S. for obesity, costs $1,540 for a 1-month supply of diabetes medication.

Currently, Medicare cannot pay for prescriptions to treat obesity. Medicare would be required to cover weight loss drugs if the bipartisan Treat and Reduce Obesity Act is reintroduced and approved by Congress.

The New England Journal of Medicine estimates that if 10% of Medicare beneficiaries with obesity were to use prescription weight loss drugs annually, Wegovy’s part D spending would reach $26.8 Billion, compared to $1.32 Billion for a generic older Qysmia product from Vivus Inc.

This amounts to almost 20% of 2019 Medicare Part D spending according to Khrysta Baig of Vanderbilt University School of Medicine, and her colleagues.

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