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Drugmaker Eli Lilly has won US regulatory approval to sell a weight-loss drug in pill form, setting up a fight with rival Novo Nordisk in the market for oral obesity medicines.
The approval for Lilly’s pill, called Foundayo, was widely expected by investors to be announced this month. Still, the drugmaker’s shares jumped 5 per cent after it announced the US Food and Drug Administration approval. Indianapolis-based Lilly said doctors can start writing prescriptions for the pill immediately and shipments to patients will begin on April 6.
Lilly is the world leader in sales of weight-loss and diabetes drugs, with about 1.5mn prescriptions written in the US through mid-March for its injectable treatments Zepbound, Mounjaro and Trulicity, according to data from Iqvia.
But Novo Nordisk has gained ground on Lilly with its obesity pill Wegovy, which launched in the US in early January. Analysts and industry participants have said Novo’s pill has enjoyed record sales growth for a new drug in the pharmaceutical industry.
Novo’s diabetes and weight-loss prescriptions totalled 957,000 in the US in mid-March, Iqvia data show. Novo’s US-listed shares were unchanged in midday trading.
Costs of weight-loss and obesity treatments have been falling. Lilly and Novo have already lowered prices for weight-loss drugs to compete for market share and respond to President Donald Trump’s demand for cheaper medicines. They could face renewed pressure when more competitors enter the market in coming years. Pfizer, for example, last year acquired Metsera, an obesity start-up which is expected to launch a weight-loss shot in 2028.
The pill approval “marks a major positive milestone in the evolution of Lilly’s obesity [and] metabolic franchise”, Evan Seigerman, an analyst with BMO Capital Markets, said in a report. “With approval in hand, Lilly will look to directly compete with Novo’s oral Wegovy pill.”
Lilly’s new pill is different from Novo’s in that people can take it with food. Novo’s pill is supposed to be taken 30 minutes before eating. Investors would be watching closely to see if people prefer one option over the other, Siegerman said.
Lilly said the pill would cost $149 a month for the lowest dose, and people with insurance coverage could get it for as little as $25 a month. The pill would also be available through certain Medicare plans for $50 a month, beginning on July 1. Medicare is the US insurance programme for senior citizens.