Ozempic and Wegovy (both Semaglutide) recently lost patent protection in countries where 40% of the world’s population live. The list includes India, China, Turkey, Canada, South Africa, and Brazil. Thus, a drug which most of these countries’ population could not afford may now have access to a weight-loss drug for as little as $15 a month. The price is speculative, firm prices are not yet known but will likely fall over time as more competitors begin to produce the drug. The following is from the New York Times:
“The availability of these drugs, which have been restricted to high-income countries to very wealthy people, will now be democratized by the generics,” said Leena Menghaney, an activist in New Delhi focused on treatment access.
The new markets for generics are enormous. Together, India and China are home to more than 800 million adults who are obese or overweight and more than 360 million adults with diabetes.
Novo Nordisk, the maker of Ozempic, was the most valuable public company in the European Union two years ago but its stock price plummeted in response to growing competition. Its weight-loss drug prices also fell in response. Eli Lilly is the primary competitor with weight-loss drug, Tirzepatide (Zepbound). Tirzepatide will not lose patent protection for another decade in the U.S. and major markets. Losing patent protection overseas will put pressure on domestic prices if Americans and Europeans decide to mail order medications from Canada and elsewhere. Nova Nordisk recently applied for FDA approval to market Semaglutide combined with Cagrilintide, another GLP-1. The FDA recently approved a higher maximum dose of Semaglutide (7.2mg per week, up from 2.4mg). Eli Lilly is expected to gain approval to market a newer GLP-1 called Retatrutide sometime later this year.
The presence of newer, more effective weight-loss drugs could put downward pressure on the price of older GLP-1s. When Semaglutide goes generic in the U.S. in another 5 years or so, the price will plummet, likely putting pressure on the prices of the newer drugs as well. That is because if cheap Semaglutide works well for most consumers, they will be less likely to pay $1,000 more per month for the newer, improved drug.
Semaglutide (Ozempic, Wegovy) is covered by 17 to 19 patents, depending on which source you read. The last of which is not supposed to expire until early December 2031. The U.S. patent system is more generous that many other countries, granting patent extensions to spur innovation. While drug discovery responds to risk/reward ratios, it is debatable whether patent extensions spur new development or stalls new development. The probability of making more money on a drug can move the project forward. By contrast, once approved, drugmakers have a disincentive to replace a protected patent drug while it is still generating money. The incentive to innovate or go under is a strong motivator. An example of this is that a new Apple iPhone comes out every September despite the patents on the previous year’s phone still valid. Of course, Apple does not have to seek U.S. approval from a federal agency with each new model. Nor do consumers have to get a prescription to buy a new iPhone.
When prices begin to fall in response to generic competition, perhaps Novo Nordisk will position Ozempic as a lifestyle drug for people who are merely overweight rather than obese. Smaller, microdoses alleviate food cravings to help maintain a healthy diet and weight (which is how I use it). It does make one wonder why patents expire around the world years earlier than in the United States, whose consumers already cover the bulk of research and development.
Read more at New York Times: Ozempic Is About to Go Generic in India, China and Canada