Ozempic could possibly be profitably produced for lower than $5 a month at the same time as maker Novo Nordisk A/S prices nearly $1,000 within the US, in accordance with a research that revives questions on costs for top-selling therapies for diabetes and weight problems.
The blockbuster drug could possibly be manufactured for 89 cents to $4.73 for a month’s provide, figures that embody a revenue margin, researchers at Yale College, King’s Faculty Hospital in London and the nonprofit Medical doctors With out Borders reported within the journal JAMA Community Open. That compares to the month-to-month US record worth of $968.52 for Ozempic, a weekly injection.
Novo declined to offer manufacturing prices for Ozempic and Wegovy, its associated drug for weight problems. The corporate stated it’s making important investments to make sure that the general public has entry to its broadly common medicine. It’s making about $6 billion in capital expenditures and spending $11 billion to amass manufacturing services from Catalent Inc. as a part of these efforts, in accordance with an emailed response to questions.
“This outrageously excessive worth has the potential to bankrupt Medicare, the American individuals and our total well being care system,” Senator Bernie Sanders, who has held hearings about excessive US drug costs, stated in an announcement after the findings got here out. The Vermont unbiased referred to as on Novo Nordisk to decrease the record worth of Ozempic to $155 a month or much less, according to what it prices in different international locations.
The research extends analysis exhibiting how steep US markups are for GLP-1 medicine like Ozempic and Wegovy and underlines longstanding criticism of costs for diabetes therapies, particularly insulin. On a per-month foundation, Ozempic usually will be produced for lower than numerous types of insulin, a lifesaving diabetes drug that’s been accessible for many years, the research discovered.
“The revenue margin is immense,” on medicine like Ozempic, stated Melissa Barber, a public well being economist at Yale and the research’s corresponding writer. “There ought to be a dialog in coverage about what’s a good worth.”
Novo’s mixed 2023 gross sales of Ozempic and Wegovy topped $18 billion. Patents linked to the medicine are more likely to expire in June 2033, in accordance with estimates from Bloomberg Legislation. Novo shares fell 0.8% in Copenhagen, and have gained 26% this 12 months.
Transparency Aim
Drug manufacturing prices are sometimes shrouded in secrecy with little readability on how they relate to costs, if in any respect. Barber and her colleagues used up to date estimates for uncooked ingredient prices and centered on the prices of manufacturing diabetes medicine, together with GLP-1 medicine like Ozempic, together with different diabetes tablets and insulins.
“The objective of this analysis is to have receipts, to be as clear as attainable,” Barber stated.
Novo and different drugmakers slashed US costs for some types of insulin by as a lot as 75% final 12 months beneath stress from the Biden administration. By some estimates, nevertheless, the reductions made these merchandise extra worthwhile as a result of they eradicated rebates paid to pharmacy profit managers, the middlemen who negotiate costs for payers and employers.
Novo stated in an e-mail that 75% of its gross earnings goes to rebates and reductions to make sure sufferers have entry to merchandise like semaglutide, the lively ingredient in Wegovy and Ozempic. Drugmakers usually cite the excessive prices of analysis which will final years as a cause for his or her costs. Spending on drug analysis and improvement was nearly $5 billion final 12 months and can rise this 12 months, Novo stated.
Nonetheless, debate over the price of medicine like Ozempic and Wegovy is ramping up. State well being plans and Medicaid workplaces are seeing rising payments for Ozempic and its sister drug Wegovy, elevating questions on whether or not the will increase in price are sustainable. In January, North Carolina lower off protection of anti-obesity medicines for state staff, citing hovering prices and lack of settlement on pricing from drugmakers.
Surprisingly, the research discovered that the most important price in producing Ozempic just isn’t the lively drugs, referred to as semaglutide, however the disposable pens used to inject it. They are often made for not more than $2.83 monthly’s provide, the authors concluded, primarily based on interviews with former staff and consultants to injection gadget producers. One Ozempic pen is used weekly and lasts a month.
Different Prices
Against this, the lively drug in Ozempic will be produced for about 29 cents for a month’s provide, or 7.2 cents for a typical weekly dose, the analysis discovered. It’s not low cost to make — semaglutide prices over $70,000 per kilogram. However solely a tiny amount of the drug is utilized in every weekly dose.
Different prices embody these of filling every pen, estimated at 20 cents per month-to-month dose, and different chemical substances, which the research estimates at 15 cents per month-to-month dose.
The evaluation doesn’t embody estimates for the price of making Wegovy. Separate analysis from the College of Liverpool and elsewhere discovered final 12 months that Wegovy could possibly be produced for a mere $40 a month.
