Novo Nordisk says that the high prices of its best-selling weight-loss drugs, Wegovy and Ozempic, are due to middlemen in the U.S. healthcare system. This comes after U.S. Senator Bernie Sanders started an investigation into the drugs.
The Danish drug company told the Senator for Vermont in a letter that it only keeps 60% of the list price for both drugs and gives the rest to middlemen.
The U.S. Senate Health, Education, Labour, and Pensions (HELP) committee, which Sanders chairs, has started an investigation into the two drugs’ high list prices. Novo Nordisk’s letter comes after the investigation.
Novo Nordisk NOVO.B, -0.85%, which is now Europe’s most valuable company, wrote to Sanders on Friday and blamed middlemen in the complicated U.S. healthcare system. The company also said it expected the net price of both Wegovy and Ozempic to fall because of the way the market is right now.
The Danish giant also said it was ready to work with U.S. lawmakers to fix “systemic issues” in the U.S. healthcare system so that more people could get its medicines.
Sanders asked Novo Nordisk to give a detailed breakdown of the costs it has incurred in developing and making its weight-loss drugs in a letter sent in April that announced the start of the HELP committee’s investigation into the company.
Novo Nordisk charges $1,349 a month for Wegovy in the U.S., but only $140 a month in Germany and $92 a month in the U.K., according to the senator’s letter from April.
The April letter says that Novo Nordisk’s Ozempic costs $969 a month in the U.S. but only $155 a month in Canada and $59 a month in Germany.
There was also research from Yale University in Sanders’ letter that showed making GLP-1 drugs could cost as little as $5 a month.
In response, Novo Nordisk said that the study’s prices didn’t take into account the billions of dollars the company spent on research and development. The Danish giant said that it spent $10 billion making its GLP-1 drugs.
With 70 million obese adults in the U.S., Ozempic is expected to bring in $18 billion for Novo Nordisk this year, and Wegovy is expected to bring in another $9 billion. A big chunk of those sales are expected to come from USA.
The Senate’s HELP committee released a report earlier this month saying that Novo Nordisk’s “outrageously” high prices could “bankrupt American health care” and cause a “massive spike in prescription drug spending” that would make insurance rates go up across the country.
The report said that giving Wegovy to just half of all obese Americans would cost $411 billion a year. This is a lot of money compared to the $406 billion a year that Americans spend on all other prescription drugs.
Sanders also wrote an opinion piece for the Danish newspaper Politiken in May in which he said Novo Nordisk had broken its moral code by charging so much for its GLP-1 agonists.
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Novo Nordisk said it had sent Sanders a letter, but they wouldn’t say anything else. BourseWatch called Sanders’ office to get a comment.
Because its GLP-1 agonist weight loss drugs have been so successful, Novo Nordisk’s value has gone through the roof. It has become Europe’s most valuable company.
