When the FDA removed Novo Nordisk and Eli Lilly’s GLP-1 medications from the drug shortage list, it seemed like compounded versions would no longer be a viable option. However, compounding pharmacies found a loophole and continued to produce off-brand versions of these popular weight loss drugs. Even now, months later, compounded GLP-1s are still being sold on platforms like Hims & Hers.
Compounded drugs are not FDA approved and are typically allowed on the market when there is a shortage of the brand-name medications or when patients require personalized versions. During the shortage of Novo and Lilly’s drugs last year, compounded GLP-1s were offered at a much lower cost for patients paying out of pocket.
Despite the FDA’s plans to crack down on compounding pharmacies once the shortage was over, these pharmacies are still operating by marketing their GLP-1s as “personalized” with minor formula changes. This loophole has been described as a regulatory failure by some experts.
Novo Nordisk has been particularly affected by the compounded drug issue, impacting the uptake of Wegovy prescriptions and overall growth in the branded obesity market this year. Compounded GLP-1s are estimated to be used by around 1 million patients in the U.S.
The competition between Novo and Lilly in the obesity market has intensified, with Lilly’s market share rising to 57% as of the second quarter. Several telehealth platforms have partnered with Lilly or Novo to offer their branded weight loss drugs, but some have also started offering compounded versions at a fraction of the cost.
For example, Noom partnered with LillyDirect to sell Zepbound vials but also launched low-dose compounded semaglutide at a significantly lower price. These microdoses aim to reduce the side effects associated with semaglutide use, which have led many patients to discontinue the treatment.
Lilly has made it clear that it will only partner with telehealth platforms that agree not to sell compounded GLP-1s. Novo’s direct-to-consumer channel offers Ozempic vials at half the list price of injectable pens, but compounded versions are still capturing a significant share of the market.
To combat the sale of compounded GLP-1s, both Lilly and Novo have launched lawsuits against pharmacies selling these products, arguing that they are illegal and put patients at risk. Novo filed 14 new lawsuits this month against various entities involved in the distribution of unapproved knockoffs of Wegovy.
Moving forward, Novo is committed to protecting patient safety and ensuring that laws are followed in the marketing and distribution of GLP-1 medications. The FDA has also updated its warning about unapproved, compounded GLP-1s, emphasizing the risks associated with these products.
