Novo Nordisk’s meteoric rise has been met with a wave of ringing endorsements from customers who have seen years of struggles with obesity solved in a flash with the help of Ozempic and Wegovy. At least, that’s the opinion of those who can afford or even access the pricey drugs.
Novo Nordisk CEO Lars Fruergaard Jørgensen called out Americans’ struggles to navigate the “complex U.S. Healthcare system” and that “no company alone could solve such vast and complicated policy challenges,” defending the price of his weight loss-aiding drugs that vastly outstrip prices in Europe and the U.K.
Jørgensen was on the offensive on Tuesday after challenges from Bernie Sanders, who in May urged Novo Nordisk to “help the American people” by reducing its profit ambitions to faster address a diabetes and obesity epidemic in the U.S.
Jørgensen goes on the offensive
GLP-1 drugs have historically been used to treat type 2 diabetes, but in the last few years, they have exploded in popularity for their ability to induce dramatic weight loss.
Novo Nordisk, which makes Ozempic, Wegovy, and Semaglutide, has increased in value by more than 240% since the start of 2021, while annual sales rose by 65% between 2021 and 2023.
The pharmaceutical group’s market value eclipsed the annual GDP of its native Denmark last year, and policymakers regularly name-check Novo, noting the group’s influence on the country’s financial system. Its drugs are also regarded as a genuine silver bullet to addressing a long-running obesity crisis in the Western world.
However, that growing hype, particularly in the U.S., has invited scrutiny from lawmakers.
Jørgensen volunteered to testify before the Senate Committee on Health, Education, Labor, and Pensions (HELP) on Novo’s pricing disparity in the U.S. After facing criticism from senators, including HELP chair Bernie Sanders. The committee initially planned to force its president, Doug Langa, to testify before Jørgensen volunteered.
Consumers in the States face paying orders of magnitude more for Ozempic and Wegovy than people in the U.K. And the rest of Europe. Wegovy’s over-the-counter price, for example, is 1,300% more expensive in the U.S. Than in the U.K.
In written testimony, however, Jørgensen said 90% of U.S. Patients with healthcare coverage were paying less than $50 per month for Ozempic and Wegovy. He added that Ozempic is covered by 99% of commercial plans and Medicare and Medicaid in all 50 States.
Wegovy is covered by 50% of commercial plans and in 20 Medicaid states, leaving considerable affordability gaps.
“However, the complexities of the system unfortunately reduce access and affordability for many Americans,” Jørgensen said. “We are eager to work with this Committee to address these systemic issues so that everyone who can benefit from our medicines is able to get them.”
Giving oral testimony to the Sanders-led HELP committee, Jørgensen said: “You have said that our amazing medicines can’t help patients if they can’t afford them. That is true. It is also true that the true value of Ozempic and Wegovy can only be realized if patients can access them. Patients need both affordability and access.”
Jørgensen’s testimony was months in the making, and tensions were fomented in the interim following inflammatory rhetoric by Bernie Sanders and other U.S. Politicians.
Sanders blasted Novo Nordisk after a HELP Committee investigation found the Danish giant was charging Americans $1,349 for a month’s supply of Wegovy while people in the U.K. Were being charged just $92.
“The American people are sick and tired of being ripped off by giant pharmaceutical companies who make huge profits every year while charging us outrageous prices,” Sanders said in June.
“It’s obvious. It’s simple. We want Novo Nordisk to stop ripping off the American people and charging us prices that are far higher than they charge in other countries.”
In Jørgensen’s comments to the committee, he was keen to put into perspective Novo’s contribution to obesity reduction in the U.S. Compared with the public sector.
The Novo CEO noted that his company spent $4.2 billion on diabetes and obesity research and development last year, 50% more than the U.S.’s leading research body, the National Institutes for Health.
The group has committed to expanding its production capacity in the U.S., a response to demand outstripping supply of GLP-1s after consumers began buying up stock in the wake of the drugs’ weight loss revelations.
The Novo boss highlighted his group’s pledge to spend $30 billion to expand production capacity worldwide.
Jørgensen added in his written testimony that Ozempic would be eligible for price negotiations with customers, including Medicare, from next year.
This, Jørgensen said, would likely bring down the price of Ozempic. He noted that the net price of Ozempic—the price Novo Nordisk is paid for its medicines—has declined by 40% since its introduction to the U.S. In 2018.
