This appeared last week:
Big pharma steps up push for taxpayer-funded weight-loss drugs
Michael Smith Health editor
Feb 9, 2025 – 1.00pm
Novo Nordisk and Eli Lilly have asked the federal government to list their blockbuster weight-loss drugs on the Pharmaceutical Benefits Scheme, arguing funding the treatment will reduce a costly obesity crisis.
Novo Nordisk, the Danish pharmaceutical giant that makes Ozempic and Wegovy, used a submission to the government’s budget process to push for the inclusion of so-called GLP-1 drugs on the PBS for chronic weight management. It said not doing so would be more expensive in the long term.
“Novo Nordisk recommends decisive action, including increased investment in health promotion, integrated disease prevention and care, and expanded access to pharmacotherapy. The cost of inaction is far greater than the cost of intervention,” the company said in its submission.
Eli Lilly, the American company that makes a rival weight-loss drug called Mounjaro, has also called for the obesity drugs to be listed on the PBS in its pre-budget submission. The Eli Lilly submission has not been made public, but people briefed on its contents confirmed the inclusion.
A PBS listing means the government subsidises most of the cost of a drug. Ozempic is listed on the PBS but only to treat people with diabetes rather than obesity. Novo Nordisk plans to resubmit an application to have Wegovy listed with the Pharmaceutical Benefits Advisory Committee, this year.
Pharmaceutical companies argued there were economic benefits to improving access to the drugs, which sell for between $345 and $645 per month, because a reduction in the number of obese people would take the pressure off the health system in the future.
Novo Nordisk last week reported a 29 per cent increase in fourth-quarter earnings to 28.23 billion Danish kroner ($6.3 billion) as sales of Wegovy jumped 107 per cent year-on-year. Eli Lilly on Friday said fourth-quarter sales surged 45 per cent to $US13.53 billion ($21.5 billion). The companies do not break down sales data for specific countries, including Australia.
Novo Nordisk’s pre-budget submission said chronic disease was the leading health challenge in Australia, affecting 61 per cent of the population and accounting for 91 per cent of preventable deaths. Its submission said obesity was a major contributor and 6.3 million Australians were obese, with the number expected to rise to 47 per cent of adults by 2035.
Doctors say while the drugs are proven to help people lose weight there is still a lot they do not know about the long-term effects of managing fat chemically and that it is important to lead a healthy and active lifestyle. The drugs are taken once a week by an injection.
The latest move by the drug companies reopens the debate about whether taxpayers should subsidise the new class of medicines. Last year, Mounjaro was made available on Britain’s public healthcare system to some patients.
Jonathan Karnon, a health economist at Flinders University, said it would be more difficult to convince the Australian government because of the way that subsidising those drugs would affect the federal budget.
“It will be interesting to see what happens in England because it affects local budgets, whereas in Australia, it affects the Commonwealth government’s budget and so the effect on the budget is of greater concern to those making decisions about whether the GLP-1s should be funded,” he said.
‘Unaffordable for many Australians’
Patients groups said GLP-1s were unaffordable for most Australians and some funding should be provided.
“Given that GLP1-s remain unaffordable for many Australians who could benefit from them, some form of government-funded access needs to be on the horizon. That said, government funding must remain contingent on the usual processes assessing value for money against benefit to patients,” Lisa Robins, chief executive of the Australian Patients Association said.
Woolworths-backed telehealth business Eucalyptus, which has earned more than $100 million from weight-loss services over the past 18 months from its operations in Australia, Japan, the United Kingdom and Germany, said a PBS listing was needed to tackle obesity in Australia.
“As we have seen recently, the Australian Institute of Health and Welfare has released figures showing that for the first time obesity has surpassed smoking as the leading risk factor contributing to death. This underlines the importance of ensuring patients have access to care,” Matt Vickers, the clinical director of Eucalyptus subsidiary Juniper said.
While a PBS listing could be restricted to a defined group of obese people with related health risks or the number of subscriptions capped, the popularity of the drugs and their wide use means government bureaucrats will be wary of approving a listing that could potentially bankrupt public healthcare systems if too many people wanted them.
Academics studying the take-up of GLP-1s said the lack of hard data on how many Australians were taking them was alarming, but they estimated the numbers were in the hundreds of thousands. Studies in the US suggest that between 8 per cent and 12 per cent of Americans are taking them.
Michael Smith is the health editor for The Australian Financial Review. He is based in Sydney. Connect with Michael on Twitter. Email Michael at michael.smith@afr.com
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All this raises a lot of issues in my mind about the mass medication of a large number of people and just how both the costs and the side-effects would be managed.
There is certainly a strong case for use in the significantly obese as this will save lives etc. but how the costs (which will be significant) and the allocation of these meds will be managed will be a real challenge I suspect. Many clever bureaucrats will have to work out how all this will work given the large scale need, and the costs involved.
A real watch this space moment!
David.