Denmark curbs Ozempic subsidies, citing overuse and high costs

2024-05-01

上市批准

Regulators in Novo Nordisk's home base of Denmark announced restrictions on subsidies for the company's diabetes drug Ozempic (semaglutide), citing rising public spending on the GLP-1 agonist GLP-1 agonist, which is increasingly being used off-label for weight loss. The changes, announced Wednesday, will take effect starting November 25.

The Danish Medicines Agency cited concerns over the "inappropriate" high consumption of subsidised GLP-1 analogues, with Danish authorities spending $200 million on Ozempic in 2023, accounting for 8% of all medicine costs and double the previous year's expenditure.

In response to negotiations with Danish authorities, Novo Nordisk agreed this week to lower the price of Ozempic in Denmark from $188 to $125 per month, a move the agency estimates will save the government more than $70 million annually. Despite the cut, the price is still twice as expensive as SGLT-2 inhibitors, which Danish officials said are the "most obvious" treatment alternative to GLP-1s, while other diabetes drugs would be cheaper still.

Bypassing cheaper options

According to the agency, half of new diabetes patients last year started directly on GLP-1 analogue drugs without having first tried other treatments. Besides Ozempic Ozempic, GLP-1 drugs include Novo Nordisk's Rybelsus (semaglutide) and Victoza (liraglutide) as well as Eli Lilly's Trulicity (dulaglutide).

Under the new rules, subsidies for Ozempic and certain other GLP-1 drugs will only be provided to patients who cannot be treated with cheaper alternatives, such as metformin, SGLT-2 inhibitors, DPP-4 inhibitors DPP-4 inhibitors, and beta-cell stimulants.

In a statement, Novo Nordisk said, "Ozempic has been on the market in Denmark since 2018, and locally it's normal for the price of a drug to be reassessed during the life cycle."

The decision in Denmark could have broader implications for other markets, particularly in the US, although a recent FDA approval has paved the way for Medicare coverage of Wegovy, Novo Nordisk's weight-loss drug containing the same active ingredient as Ozempic.

In 2022, the Danish Medicines Agency rejected a request by Novo Nordisk to subsidise Wegovy, saying the price didn't match the medical benefits. The authority is now reviewing a new proposal to apply a model in which the cost of subsidies would be shared between the government and the drugmaker.

For related analysis, see Vital Signs: GLPs find their (temporary) revenue ceiling.

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