Medicare Part D plans have been clamping down on their coverage of type 2 diabetes drugs in the GLP-1/GIP agonist class over the past year as public interest in using the drugs to lose weight grew, data from market access and analytics provider MMIT shows.
Key Takeaways
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The introduction of obesity products in the GLP-1/GIP agonst drug class has jolted Medicare Part D plans even though the program does not cover weight loss drugs.
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A major shift from preferred coverage without restrictions to prior authorization requirements began in 2023.
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The trend is sure to continue as drugs approved for obesity (Wegovy and Zepbound) gain additional indications that Part D does cover.
Obesity drugs are not covered by Part D under the law and plans do not cover treatments such as Novo Nordisk A/S’s Wegovy (semaglutide) for that use.
But after the news got out that Novo’s other semaglutide product, Ozempic, could help with weight loss too, Part D plans responded with tighter coverage restrictions. Ozempic is only approved for type 2 diabetes.
Ozempic garnered significant public attention in early 2023 when Oscar awards ceremony host Jimmy Kimmel mentioned the drug and its popularity in Hollywood for weight loss in his opening monologue.
The move to more restrictive coverage spilled over to Novo’s oral semaglutide drug for diabetes, Rybelsus, and other leading drugs in the same class as well, as plans worked to prevent enrollees from obtaining coverage of the drugs for obesity under the guise of other indications.
Medicare Part D formulary status for Ozempic, Rybelsus and Eli Lilly and Company’s Mounjaro (tirzepatide) and Trulicity (dulaglutide) transitioned from preferred with no utilization management to preferred with prior authorization or step therapy for a significant number of enrollees from April 2023 to the beginning of April 2024 (see chart below).
Although the data record the use of prior authorization and step therapy together, the restrictions that MMIT found for the drugs were primarily PAs, according to the group.
A strong majority (75.6%) of Part D enrollees had preferred coverage with PA/ST for Ozempic as of early April, while about 83% had preferred coverage with no utilization management for the drug a year earlier, the data show.
Similarly, about 73% of enrollees had preferred coverage with PA/ST for Rybelsus as of earlier this month compared to 82% of enrollees with unrestricted preferred coverage in April 2023.
Click on the tabs to see data for each year. The story continues after chart...
Wegovy was not covered in Part D during the period. But the US Food and Drug Administration’s early March approval of a cardioprotective claim for the drug is expected to lead to increased coverage of the treatment in Part D for the secondary indication, although most likely with strict prior authorization requirements. (Also see "US Medicare Plans ‘Can’ Cover Wegovy, CMS Says, But Will They?" - Pink Sheet, 26 March, 2024.)
The data on coverage for Lilly’s Mounjaro show the same pattern in terms of a shift from preferred coverage to preferred coverage with restrictions.
However, the drug differed on overall coverage compared to Ozempic and Rybelsus during early 2023. Coverage was more limited at that point because Mounjaro was still relatively new to the market after launching in the spring of 2022. Mounjaro went from “not covered” for 50% of enrollees in April 2023 to not covered for just 13% this April.
Zepbound In Sleep Apnea
Zepbound, Lilly’s version of tirzepatide for obesity, launched in November 2023. Like Wegovy, it was not covered in Part D during the data period. However, Zepbound also could get a foot in the door in Part D if it is approved for a non-obesity claim.
Lilly is planning to apply for a new Zepbound indication in sleep apnea among those with obesity around the middle of this year, the company announced 17 April. A priority review could lead to approval in early 2025 and make the drug the first to treat the condition.
The application will be based on data from the company’s two SURMOUNT-OSA Phase III clinical trials, which found the drug reduced the apnea-hypopnea index by 55% and 63% compared to placebo, according to the firm.
AHI records the number of times a person’s breathing shows a restricted or complete block of airflow per hour of sleep and is used to evaluate the severity of obstructive sleep apnea and the effectiveness of treatment outcomes.
Lilly has previously discussed the possibility that adding an indication like sleep apnea could allow for broader use of obesity drugs in Part D. (Also see "Medicare Coverage For Lilly’s Tirzepatide Could Be ‘Unlocked’ With Heart Failure, Apnea Claims" - Pink Sheet, 11 November, 2022.) The prospect will likely reinforce utilization management in Part D as payers face increasing challenges to block coverage in the burgeoning obesity category.
Stunning US Sales Increases
US sales in the fourth quarter and full year 2023 soared for Ozempic, Wegovy and Mounjaro, with use in obesity driving stunning gains (see graphic below).
Wegovy sales advanced nearly 400% to $4.3bn in 2023 and Ozempic sales ended the year at $9.1bn, up 67%. Mounjaro recorded a nearly 900% increase to $4.8bn for the year after surging 722% in the fourth quarter alone.
The remarkable performance of the three drugs dominated the class as US sales for Novo’s older drug Victoza (liraglutide), and Lilly’s Trulicity, lost ground.
Lilly attributed the decline in Trulicity’s sales to lower volume and lower realized prices because of price concessions. Volume was hampered during the year by a shortage of the drug that is linked to the demand for Ozempic.
Citeline Digital Content Designer Nancy Pham and AIS Health Data Reporter Jinghong Chen contributed to this article.
