Prices higher for new anti-obesity drugs in the US compared to other countries

August 28, 2023

Source: KFF Peterson Health System Tracker, August, 2023 LINK

We know that US drug prices are high. This chart from KFF gives you a sense of just how high drug costs are here in the US compared to other developed countries. Ozempic, for instance, used to treat diabetes (and off-label for obesity) has a list price of almost ten times more in the US compared to in the United Kingdom!

These are list prices - and don’t include discounts and rebates which are significant in the US. Drugs are distributed in the US through wholesalers and payment is arranged through pharmacy benefit managers (PBMs), each of which takes a portion of the total drug cost for their services.

Implications for employers:

-        Net prices that employers pay for these drugs in the US are substantially higher than in other developed countries, and this is both because of payments to intermediaries and higher payments received by the pharmaceutical companies

-        Pharmaceutical companies are more likely to distribute drugs in the US earlier, as they obtain higher margins from medications paid for in our exceptionally expensive system. This is beneficial for drugs that treat previously untreatable cancer, and drugs that are in short supply.

-        If semaglutide (the active ingredient in both Wegovy and Ozempic) were available in the US at the UK price for Ozempic, it would be far easier to finance GLP-1 medications for all those who qualified and want to take these medications.

Tuesday: Substance use disorder touches two thirds of Americans, and only a quarter with opioid use disorder receive medications for this

You can find previous posts in the Employer Coverage archive

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