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The Trump Administration recently announced a multi-pronged deal with Eli Lilly and Novo Nordisk aimed at lowering the cost of GLP-1 medications used for weight loss and diabetes. While many details remain in flux, the proposed framework will impact GLP-1 coverage for certain Medicare and Medicaid beneficiaries and pricing for cash-pay individuals.&nbsp;

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For Medicare and Medicaid beneficiaries, the deal proposes to:

offer injectable GLP-1 medications from Eli Lilly and Novo Nordisk for $245/month for weight loss and diabetes. Medicare beneficiaries will have a $50 copay, whereas Medicaid beneficiaries will have no copay or otherwise a very limited out-of-pocket cost; and

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if new oral pill versions of the GLP-1 medications are approved by the U.S. Food &amp; Drug Administration (“FDA”), offer these pills at their lowest doses for $149/month.

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Today, Medicare already covers GLP-1s for diabetes and for cardiovascular risk reduction, and Medicaid covers the same for those that qualify based on level of income and resources. Under the deal, the coverage under both programs would expand to include patients with obesity who are considered to be at high metabolic or cardiovascular risk. Many patients who would qualify under these new criteria may already meet current coverage conditions, so the number of people who would be newly eligible is uncertain, although the administration estimates that roughly 10 percent of the Medicare and Medicaid population will be eligible under the expanded access. The administration is aiming to make this new coverage available to Medicare beneficiaries by mid‑2026. It is unknown at this time when the Medicaid coverage would begin.

In addition to Medicare and Medicaid expansion, the administration also announced that TrumpRx could offer a new, lower-cost pathway to GLP-1s for cash-pay patients beginning in January 2026 (although the launch timeline and operational details are far from settled). For those unfamiliar with TrumpRx, the platform (which has yet to be officially launched) will aim to connect patients directly with better priced drugs and, in doing so, increase transparency in drug pricing and cut out potentially costly third-party markups. Under TrumpRx, Wegovy and Zepbound will purportedly be sold directly to patients at prices that will start around $350/month, with a potential to scale down to $250/month over the next two years. Similar to the benefits offered under Medicare and Medicaid, if new pill versions are approved by FDA, Eli Lilly and Novo Nordisk have agreed to offer them to TrumpRx patients at $149/month at their lowest doses. It remains unclear how these pricing plans will impact LillyDirect and NovoCare.

In exchange for lowering prices, Eli Lilly and Novo Nordisk each received one of FDA’s “national priority vouchers.” In tandem with the November 6 announcement, FDA announced that Oral Semaglutide (Novo Nordisk’s GLP-1 tablet) and Orforglipron (Eli Lilly’s GLP-1 tablet), both intended for weight loss, would get accelerated review through the voucher program, which promises review and decision within two months or less. The drug manufacturers will also be granted relief from tariffs (a so-called three year “grace” period) if they follow through on their commitments to boost domestic manufacturing.&nbsp;

Missing from this announcement is any discussion about commercial coverage. More than half of U.S. residents are covered by private insurance, and many plans have been reluctant to broadly cover GLP‑1s because of the high costs. Eli Lilly and Novo Nordisk have generally committed to lowering the cost of the drugs for commercial insurers, but at the time of the announcement no further details were provided as to specific changes related to private insurance.

Many industry questions remain open, such as whether this deal will have any impact on commercial insurance coverage and how (and when) cash-pay patients can expect to benefit from the new pricing scheme. We will continue monitoring implementation timelines, FDA decisions on pill formulations, and how stakeholders respond to the evolving price landscape.

If you have questions on any of the issues raised in this alert, or would simply like to discuss the latest developments in the regulatory landscape in light of these developments, please contact <a href="/people/rachael-g-pontikes/" type="poa_person" id="18670">Rachael G. Pontikes</a>, <a href="/people/emily-l-hussey/" type="poa_person" id="18672">Emily L. Hussey</a>, <a href="/people/susan-j-dewey/" type="poa_person" id="18653">Susan J. Dewey</a>, <a href="/people/amica-j-nesbitt/" type="poa_person" id="18647">Amica J. Nesbitt</a>, <a href="/people/kelly-j-kearney/" type="poa_person" id="18664">Kelly J. Kearney</a>, <a href="/people/garrison-b-ambrose/" type="poa_person" id="18654">Garrison B. Ambrose</a>, or another member of our <a href="/services-and-industries/healthcare/" type="poa_practice" id="18520">Healthcare</a> industry team or <a href="/people/shannon-e-mcclure/" type="poa_person" id="18671">Shannon E. McClure</a> of the <a href="/services-and-industries/litigation/business-litigation/" type="poa_practice" id="18541">Business Litigation</a> group.

A New Deal For GLP-1s

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A New Deal For GLP-1s

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