Wall Street sees new obesity pills as priced near Wegovy and Zepbound

The weight-loss drug Wegovy is shown in this undated handout photo. THE CANADIAN PRESS/HO, Novo Nordisk Canada Inc.

SEATTLE — U.S. prices for obesity-treatment pills that Eli Lilly and Novo Nordisk aim to launch next year likely will be on par with their weight-loss injections, analysts and investors say, in a departure from the usual practice of charging more for new medicines despite pressure to cut prices.

Neither drugmaker has disclosed pricing plans for their new daily oral medications. With regulatory approvals and launches still months away, pricing plans could change. Denmark-based Novo expects approval later this year and to launch soon after, while Indianapolis-based Lilly expects to launch by August 2026.

Novo’s Wegovy and Lilly’s Zepbound, administered as weekly injections, are the only highly effective weight-loss drugs targeting the GLP-1 hormone, and the United States is their biggest market. U.S. list prices are about US$1,000 per month or more, with bothcompanies offering a monthly supply for $499 to customers paying cash rather than using health insurance.

Both companies have said they developed oral weight-loss drugs to meet patient needs and widen access to the market, mindful that some people are averse to injections.

The pills, however, are not more effective than the injections. Lilly said this month its pill orforglipron cut weight by 12.4 per cent after 72 weeks in a trial. That compares with weight loss of 15 per cent for Novo’s daily oral semaglutide. Both trail Lilly’s injection at up to 21 per cent.

UBS analyst Trung Huynh said that will cap Lilly’s pricing. The price is “probably going to come on par with the current drugs today or slightly lower,” Huynh said.

TD Cowen analyst Michael Nedelcovych said he expects Novo’s pill to debut near Wegovy’s price, citing the precedent of its diabetes pill Rybelsus being priced at parity with injection Ozempic, the diabetes-treatment version of Wegovy. Novo executives told analysts this month they were not in a hurry for discount pricing for the new pill.

Oral GLP-1 drugs will fill a niche rather than displace injections, according to analysts. TD Cowen estimates that pills will account for a percentage share of the global obesity drug market in the mid-teens by 2030, which could reach $150 billion by then.

Growing cash pay

U.S. doctors, patients and insurers are pressing for lower prices to make the weight-loss drugs more affordable for the 40 per cent of Americans who are obese. Typically, drugmakers launch new drugs at higher prices, citing scientific advances. President Donald Trump and lawmakers from both parties have urged the companies to reduce U.S. prices.

Novo declined to comment on pricing, pointing to Aug. 6 comments by David Moore, its U.S. operations head, saying that the company may tap customers paying cash directly via its new NovoCare pharmacy, which was launched this year to sell Wegovy outside of insurance.

A Lilly spokesperson called it premature to comment on pricing and launch plans for its pill because the company has not yet submitted data for regulatory approval.

Peak annual sales forecasts for Lilly’s orforglipron fell to as low as $10 billion after its trial data from earlier estimates of up to $30 billion, according to a Reuters review of analyst estimates. HSBC forecasts $15 billion in peak annual sales for Novo’s pill, while Barclays expects only $1 billion.

Manufacturing volume

A key question is how much supply will be available at the time of launch. Shortages of injectable GLP-1s in 2023 and 2024 opened the U.S. market to cheaper compounded versions as the manufacturers failed to anticipate the huge demand.

“It’s all about scale and pricing,” said Kevin Gade, portfolio manager at Bahl & Gaynor, which owns Lilly shares.

Gade pointed to Novo’s manufacturing challenge. The pill form requires about 75 times more active ingredient than the highest-dose Wegovy injection, two analysts told Reuters.

Lilly has said it already has $808.5 million in orforglipron inventory for next year’s expected launch. Novo has said it will launch its pill without supply constraints after billions of dollars in investment to expand semaglutide production.

Despite the high production needs, Novo is unlikely to debut its pill at a higher price than Wegovy, said Karen Andersen, healthcare strategist at Morningstar.

“Particularly in the growing cash-pay market, I doubt it can risk a launch at a premium to Wegovy,” Andersen added.

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(Reporting by Maggie Fick in Seattle and Bhanvi Satija in Bengaluru; Editing by Caroline Humer and Will Dunham)