GLP-1 Pricing
A major topic of discussion concerning the high cost of GLP-1 drugs. Eli Lilly is committed to reducing the price over time while balancing the need to fund future R&D, stating they expect single-digit deflation in the category over time.
First Mentioned
9/29/2025, 5:01:45 AM
Last Updated
9/29/2025, 5:06:25 AM
Research Retrieved
9/29/2025, 5:06:25 AM
Summary
GLP-1 pricing is a complex and controversial topic, reflecting the drugs' evolution from treatments for type 2 diabetes to revolutionary therapies for weight loss and obesity. Companies like Eli Lilly, with its top-selling drug Tirzepatide, face the challenge of balancing high costs—ranging from approximately $8,000-$9,000 annually in the U.S. commercial market, or $5,988 direct-to-consumer, significantly higher than prices in countries like Denmark, Germany, and the UK—with the necessity of funding extensive research and development for new applications in areas such as addiction and mental health. Despite impressive health benefits, current U.S. prices often fall short of cost-effectiveness benchmarks, with analyses suggesting substantial price reductions are needed for drugs like Tirzepatide (30%) and Semaglutide (80%). The market is further complicated by issues such as counterfeit products, patent challenges influenced by the American Invents Act, and a difficult investment climate for biotech venture capital. Industry leaders also criticize pharmacy benefit managers (PBMs), question the efficiency of NIH funding, and highlight outdated FDA regulations impacting pharmaceutical advertising, while simultaneously investing heavily in supply chain expansion, particularly in the United States, to meet growing demand.
Referenced in 1 Document
Research Data
Extracted Attributes
New developments
Upcoming oral GLP-1 pill
Market challenges
Counterfeit products, patent hacking (American Invents Act), difficult biotech venture capital climate
Pricing philosophy
Balance between increasing patient access and funding future R&D
Annual cost (Denmark)
Approximately $2,232
Annual cost (Germany)
Approximately $1,680
Average monthly cost (US)
Approximately $1,000
Initial medical indication
Type 2 diabetes
Annual cost (United Kingdom)
Approximately $1,104
Expanded medical indications
Weight loss, obesity, non-alcoholic fatty liver disease, polycystic ovary syndrome, diseases of the reward system (addictions)
Investment strategy (Eli Lilly)
Aggressive capital allocation for supply chain expansion, building manufacturing plants in the United States
Cost-effectiveness threshold (US)
Less than $100,000 per quality-adjusted life year (QALY)
Annual cost (US commercial market)
Approximately $8,000-$9,000
Industry criticisms (Eli Lilly CEO Dave Ricks)
Pharmacy Benefit Managers (PBMs), NIH funding efficiency, outdated FDA regulations for pharma advertising
Top-selling drug (Q2, unspecified recent year)
Tirzepatide (surpassed Keytruda)
Annual cost (US direct-to-consumer, outside insurance)
Approximately $5,988
Semaglutide price reduction needed for cost-effectiveness
80%
Tirzepatide price reduction needed for cost-effectiveness
30%
Timeline
- GLP-1 drugs accounted for 1% of the overall prescription cost for the Rx Collaborative, the largest pharmacy coalition in the U.S. (Source: web_search_results)
2020-01-01
- The American Diabetes Association standards of medical care recommend GLP-1 agonists as a first-line therapy for type 2 diabetes. (Source: wikipedia)
2022-01-01
- ICER's evaluation of obesity medications cited GLP-1 prices ranging from $12,000-$14,000 annually. (Source: web_search_results)
2022-01-01
- Obesity cost employers more than $400 billion. (Source: web_search_results)
2023-01-01
- GLP-1 drugs accounted for 21% of the overall prescription cost for the Rx Collaborative. (Source: web_search_results)
2025-01-01
- Net pricing data for GLP-1s from SSR Health, Inc. was obtained. (Source: web_search_results)
2025-03-01
- ICER White Paper titled 'Affordable Access to GLP-1 Obesity Medications' was published. (Source: web_search_results)
2025-04-09
- University of Chicago researchers published studies analyzing GLP-1 drug pricing and cost-effectiveness. (Source: web_search_results)
2025-06-01
Wikipedia
View on WikipediaGLP-1 receptor agonist
Glucagon-like peptide-1 (GLP-1) receptor agonists, also known as GLP-1 analogs, GLP-1RAs, or incretin mimetics, are a class of anorectic drugs that reduce blood sugar and energy intake by activating the GLP-1 receptor. They mimic the actions of the endogenous incretin hormone GLP-1, which is released by the gut after eating. GLP-1 agonists were initially developed for type 2 diabetes. The 2022 American Diabetes Association standards of medical care recommend GLP-1 agonists as a first-line therapy for type 2 diabetes, specifically in patients with atherosclerotic cardiovascular disease or obesity. The drugs were also noted to reduce food intake and body weight significantly, and some have been approved to treat obesity and other components of the metabolic syndrome in the absence of diabetes. They are also in development for other indications, such as non-alcoholic fatty liver disease, polycystic ovary syndrome, and diseases of the reward system such as addictions.
Web Search Results
- Affordable Access to GLP-1 Obesity Medications
for GLP-1s used for obesity in the U.S. commercial market range from approximately $8,000 to $9,000. Prices charged by GLP-1 drugmakers in their own direct-to-consumer offerings outside of insurance are lower, approximately $499 per month, or $5,988 annually.24,25 Net prices have fallen substantially from the $12,000-$14,000 cited in ICER’s 2022 evaluation of obesity medications.1 As noted earlier, ICER’s cost-effectiveness modeling at that time suggests that today’s lower prices for GLP-1 [...] adults with overweight in the presence of at least one weight-related comorbid condition. • to treat moderate to severe obstructive sleep apnea (OSA) in adults with obesity. 11/8/23 $12,720 $8,700 Sources: novopricing.com and pricinginfo.lilly.com Net pricing data from SSR Health, Inc., obtained March 2025. ©Institute for Clinical and Economic Review, 2025 Page 12 Affordable Access to GLP-1 Obesity Medications: Strategies to Guide Market Action and Policy Solutions Compounded Versions of GLP-1 [...] approximately $8,000-$9,000 per year, whereas the approximate annual cost for the same product is $2,232 in Denmark, $1,680 in Germany, and $1,104 in the United Kingdom. ©Institute for Clinical and Economic Review, 2025 Page 10 Affordable Access to GLP-1 Obesity Medications: Strategies to Guide Market Action and Policy Solutions • Net unit pricing of semaglutide and tirzepatide in the obesity-labeled Wegovy and Zepbound are approximately 1.5-2.8 times higher than the price for the same
- Health Care Cost Spotlight: GLP-1 Medications
On average, GLP-1 treatment costs around $1,000 per individual each month. When considering covering weight loss drugs, many employers are concerned that they must be used for extended periods to be effective, requiring a long-term commitment. [...] While employers are largely covering these drugs due to employee demand, they often experience the advantages of a healthier workforce. Employees with obesity are likely to incur more medical costs, file workers’ compensation claims and take more sick days than other employees. Add those things up, and they can be pricey for employers. In fact, obesity cost employers more than $400 billion in 2023. Employees who are overweight or obese can cost between $1,200 and $6,700 per year in excess
- Glucagon-Like Peptide-1 Receptor Agonists: A Pharmacy ...
The current out-of-pocket cost for GLP-1s is approximately $1000 per month. Since the prices are so high, insurance companies now require prior authorizations with tight restrictions to control which patients qualify for coverage. A prior authorization—often called a “prior auth” and abbreviated PA or PAT—is the process in which a health care provider must obtain approval from the insurance company before prescribing certain medications or providing medical services in order for them to be
- GLP-1 Drugs in 2025: Cost, access and future of obesity ...
GLP-1 drugs effective to treat obesity could account for 3–4% of medical and Rx spend Cost per member per month of selected GLP-1 medications after discounts and rebates Bar chart with 5 data series. Source: WTW Rx Collaborative data on file The chart has 1 X axis displaying categories. The chart has 1 Y axis displaying Values. Data ranges from 0 to 0. Chart annotations summary $11.01 $1.46 $2.23 $4.34 $23.69 $27.23 Source: WTW Rx Collaborative data on file [...] Coverage GLP-1 medications for obesity Source: WTW 2024 Best Practices in Healthcare Survey End of interactive chart. Cost per member per month increased exponentially from $4.34 in 2022 to $27.23 in Q1 2025. Research shows that five GLP-1 drugs account for 21% of the overall prescription cost for the Rx Collaborative, the largest pharmacy coalition in the U.S., after estimated rebates and discounts, in Q1 2025, compared to just 1% in 2020. ### GLP-1 usage and costs are increasing
- Are GLP-1 drugs worth their current cost?
But those benefits come at a price: roughly $700-800 per month in the U.S. Even accounting for long-term health gains, the researchers found that GLP-1 drugs fall well short of standard benchmarks for cost-effectiveness. “We modeled an optimistic scenario using the best possible weight loss outcomes and long-term risk reductions,” said first author Jennifer Hwang, DO, a primary care physician at UChicago Medicine. “Even then, the drugs didn’t meet the cost-effectiveness threshold.” [...] That threshold is typically defined as less than $100,000 per quality-adjusted life year (QALY) — a standard tool health economists use to compare the value of medical treatments. According to the study, tirzepatide would need a 30% price reduction to meet that mark, and semaglutide would need to cost 80% less than it currently does. How much could GLP-1 drugs cost Medicare? [...] Two new studies led by researchers at the University of Chicago found that although GLP-1 drugs deliver impressive long-term health improvements, their current prices far exceed accepted thresholds for cost-effectiveness, posing difficult choices for policymakers, insurers and patients. A pharmaceutical breakthrough