FDA approval, Eli Lilly's weight-loss drug Zepbound arrives to challenge Novo Nordisk

In the Big Pharma battle to treat obesity, Novo Nordisk sprinted to an early lead, but Eli Lilly is catching up quickly.

Wednesday, the Indianapolis-based company scored FDA approval for its GIP/GLP-1 compound tirzepatide to treat obesity, which will allow broader access to the treatment in the U.S.

Dubbed Zepbound, Lilly’s new product is the same formula as blockbuster Type 2 diabetes drug Mounjaro. Since it was endorsed by the FDA in May 2022, Mounjaro has gained widespread, off-label use to treat obesity.

Now, Zepbound has been indicated for adults with a BMI of 30 or higher as well as those with a BMI of 27 or higher with weight-related problems such as hypertension, Type 2 diabetes, sleep apnea or cardiovascular disease.

With the FDA nod, Lilly now has its answer to Novo’s blockbuster duo of Ozempic for diabetes and Wegovy for obesity. The Danish company gained FDA green lights for the semaglutide products in 2017 and 2021, respectively.  

Lilly will charge $1,059.87 per month for Zepbound, which "we expect to be approximately 20% lower than the list price of our lowest competitor," Lilly CEO David Ricks said in a Wednesday call with reporters.

Ricks also said that two Eli Lilly programs will help patients cut the cost of Zepbound, including one that will reduce its price by as much as 50% for those who are waiting for commercial coverage.    

About 50 million in the U.S. presently have access to obesity medications, Lilly said, representing less than half of the people who have the disorder.

"That just isn't good enough," Mike Mason, Lilly's president of diabetes and obesity, said in the briefing. "That's why we priced it the way we are and we'll work closely with PBMs and payers to improve that."

Last week, Novo reported that Ozempic generated $3.4 billion in sales in the third quarter, while Wegovy produced $1.4 billion in revenue.

Meanwhile, Lilly reported that Mounjaro countered with $1.4 billion in sales in just its fifth full quarter on the market.

Demand for the products has been so high that both companies have struggled to meet it. Last week, Lilly said its sales for Mounjaro would have been higher were it not for “intermittent delays” in filling orders.

This year, Lilly has poured more than $2 billion into beefing up manufacturing facilities in North Carolina and close to home in Indiana. The moves will double the company’s production capacity from a year ago.

As for Novo, earlier this year, the company limited its supply of Wegovy to the U.S. and placed restrictions on starter doses to ensure it could continue serving existing patients. Last week, Novo’s CEO Lars Fruergaard Jørgensen said he expects demand to continue to outpace supply, even as the company continues to increase its manufacturing footprint.

The approval of Zepbound was backed up by two phase 3 trials which enrolled a total of 2,539 patients who weighed an average of 231 pounds. At the highest (15 mg) dose of tirzepatide, patients lost an average of 48 pounds at 72 weeks. Those on the lowest dose (5 mg) lost an average of 34 pounds.

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