CVS Health announced on Thursday that it will reinstate coverage for Eli Lilly's widely used weight loss injection, Zepbound, and will also begin covering the company's newly approved obesity pill, Foundayo, on its standard drug plans. This decision represents a significant development for Eli Lilly, bolstering its position in the competitive weight loss drug market and placing it on par with rival Novo Nordisk on major drug plans offered by CVS.
This move comes approximately one year after CVS initially struck a deal with Novo Nordisk, designating its drug Wegovy as the preferred obesity treatment on CVS's standard plans, while simultaneously removing coverage for Zepbound. The subsequent restoration of Zepbound coverage is set to take effect on October 1, and the addition of Foundayo coverage will begin on June 1. These changes are expected to enhance Eli Lilly's efforts to maintain its market leadership against Novo Nordisk, ensuring both companies' flagship weight loss medications are equally accessible through CVS's extensive network.
Under the new arrangement, GLP-1 medications from both Eli Lilly and Novo Nordisk will become co-preferred options on CVS Caremark's standard commercial formulary template. This template is a crucial list of covered drugs that insurers and employers can select for their plans. According to CVS Health, this formulary template represents between 25 million and 30 million Americans. CVS Caremark is recognized as one of the nation's largest pharmacy benefit managers (PBMs).
It is important to note that plan sponsors who opt for Caremark's standard formulary retain the ability to exclude coverage for GLP-1 medications specifically for weight loss. Therefore, access to treatments from both Lilly and Novo is not universally guaranteed for all patients, depending on the specific choices made by their employers or insurers.
CVS anticipates that this expanded coverage will lead to an estimated 10% to 15% in additional savings across the entire weight management drug category. CVS Health touted its previous agreement with Novo Nordisk last year as a pioneering step by a major PBM aimed at fostering competition within the GLP-1 market and controlling costs. CVS stated that both Eli Lilly and Novo Nordisk have collaborated with the healthcare giant to make these GLP-1 medications more affordable, pointing to "successful continued pricing negotiations" with both drugmakers.
Eli Lilly expressed its satisfaction with the expanded coverage, stating in a release, "With this expanded coverage, millions of Americans will have access to Zepbound and Foundayo, giving patients and their doctors a real choice in how obesity is treated." Lilly added that its pill will be covered by all three of the nation's largest pharmacy benefit managers, including Caremark. Novo Nordisk also commented, stating in a release that both its Wegovy injection and its newly launched pill with the same name will retain their preferred status on CVS' formularies, and that CVS Caremark patients can remain on those drugs "without interruption."
Ed DeVaney, CVS Caremark president, highlighted the company's role in facilitating access and options, stating in a release, "We're creating access and options that would not have existed without our leadership in the market." He further elaborated that CVS acted "boldly through active engagement and negotiation with our drug manufacturer partners to tackle affordability and access for our customers and their members." CVS Health indicated that Caremark will ensure a "smooth transition" to covered therapies for customers, consultants, providers, and members.
