Trump admin cracks down on affordable weight-loss treatments

The Food and Drug Administration (FDA) declared an end to the semaglutide shortage on Feb. 21, a move that could put affordable weight-loss drugs out of reach for millions of Americans.

Semaglutide is the active ingredient in Ozempic and Wegovy, injectable medications that are used to treat obesity, diabetes, and a host of other health issues.

Under the shortage, semaglutide was made available through compounding pharmacies, which make drugs on a patient-to-patient basis as opposed to mass producing them. These compounded drugs are often 70% – 90% cheaper than name-brand versions.

The FDA did not explain the rationale behind lifting the shortage, but the move came one week after Eli Lilly CEO Dave Ricks told Fox Business he was personally lobbying the White House to crack down on the availability of compounded semaglutide.

“Compounding sounds like a nice word,” Ricks said on Feb. 13, “but really these are using intellectual property that we developed, taking our invention, and buying unapproved active ingredient — mostly from Chinese labs that aren’t even approved in China — importing it and selling it to Americans at a discount. That’s not real medicine. That’s fake medicine and we think that should stop. Our advocacy with the FDA and the new administration is to shut that down.”

Ricks’ claims, however, are not completely accurate. Semaglutide was invented by researchers at the Danish pharmaceutical company Novo Nordisk. Eli Lilly invented tirzepatide, a similar drug and the active ingredient in their product Mounjorno.

While compound pharmacies do often source their semaglutide from Chinese companies, those companies are required to be registered with the FDA.

Ricks has advocated for weight-loss drugs like Mounjoro to be covered by Medicare and Medicaid. If this were to happen, and compounded alternatives were not available, it could lead to a huge infusion of federal cash into Eli Lilly’s coffers.

The decision to lift the shortage also raises conflict of interest questions for Dr. Mehmet Oz, the incoming administrator from the Centers for Medicare and Medicaid Services.

In 2019, Oz spent 20 minutes on his daytime talk show promoting Ozempic, a Novo Nordisk drug. His media company had a contract to promote Novo Nordisk products. Oz continued promoting Ozempic on his website and social media as recently as last year.

Novo Noridsk has also lobbied for weight-loss drugs to be covered by Medicaid and Medicare. 

U.S. listed shares of Novo Nordisk grew 6.2% following the FDA’s announcement. Eli Lilly’s stock value grew by 3.2%.

A group of compounding pharmacies filed a lawsuit against the FDA on Feb. 24 in an effort to block the decision. A federal judge has not yet decided if the case can move forward.