Employer plans face GLP-1 anti-obesity drug rebate threats

Suppliers of popular, expensive new drugs like Ozempic, Wegovy and Zepbound are using threats to take away rebates to keep employer-sponsored health plans from putting the drugs in utilization management programs, according to two large employer plan groups.

Shawn Gremminger, president of the National Alliance of Healthcare Purchaser Coalitions, and James Gelfand, president of the ERISA Industry Committee, complain about the suppliers’ rebate-based sales strategy in a letter sent to Sen. Bernie Sanders, the Vermont independent who chairs the Senate Health, Education, Labor and Pensions Committee, and Sen. Bill Cassidy, R-La., the highest-ranking Republican on the committee.

Related: ‘Stop ripping us off,’ says Sen. Sanders, but Novo CEO blames PBMs for high Wegovy prices

About 40% of U.S. adults suffer from obesity, and the cost of covering GLP-1 agonists and related anti-obesity drugs can be about $10,000 per patient per year, Gremminger and Gelfand write.

Many employers would like to focus GLP-1 agonist spending on the patients who need the drugs most, by requiring patients to try lower-cost alternatives first, limiting coverage for the drugs to people with a high body mass index, and requiring the patients who use the drugs to engage in lifestyle-management programs, to help them keep weight off, Gremminger and Gelfand write.

Today, however, “many employers that seek to engage in utilization management are threatened with loss of drug manufacturer rebates, meaning the per-unit cost of coverage for GLP-1s can increase dramatically,” the group leaders report.

In North Carolina, a public employee plan discovered that offering a GLP-1 agonist increased prescription spending by 10% and increased overall spending on all plan enrollees by $50 per enrollee per month,” the group leaders add, citing an Associated Press report.

When the plan tried to offer the drug through a utilization management program, the supplier said doing so would cause it to take away rebates, and the elimination of the rebates would increase the cost of each prescription by about 67%, the group leaders write.

“It is deeply disappointing that employers that are seeking to offer coverage for life-changing medicines are put in the untenable position of either significantly and uncontrollably impacting their health plan budgets, or offering no coverage at all,” Gremminger and Gelfand write.

They’re asking the Senate HELP Committee, which recently held a hearing on GLP-1 agonist prices, to investigate pricing and rebate practices by the drugs’ makers and pharmacy benefit managers.