October 8, 2024
FDA Removes Eli Lilly’s Blockbuster Drugs from Shortage List, Pressuring Telehealth Compounders
The FDA’s decision to remove Eli Lilly’s diabetes and weight-loss drugs from the shortage list is expected to reshape the market for compounded medications, hitting companies like Hims & Hers Health, which had capitalized on supply gaps.
Eli Lilly’s Mounjaro (for diabetes) and Zepbound (for weight loss) were removed from the FDA’s shortage list after the agency confirmed Lilly could meet national demand. This move has immediate consequences for compounded drug makers who had benefited from the shortage. Hims & Hers Health, which had offered cheaper, compounded versions of popular GLP-1 drugs, saw its stock fall nearly 10% on the announcement, according to Fast Company.
However, this regulatory action has sparked legal action. The Outsourcing Facilities Association, a group representing compounding facilities, filed a lawsuit against the FDA, arguing that the shortage persists and claiming that the decision was arbitrary and favored Lilly. The group contends that the FDA trusted Lilly’s assurances without considering broader public input.
Hims & Hers, meanwhile, maintains that the decision does not affect its business directly. The company’s compounded semaglutide injection, which mimics Novo Nordisk’s Ozempic and Wegovy, remains unaffected since Novo Nordisk’s drugs are still on the shortage list. Still, the pressure on compounders is growing as both Lilly and Novo ramp up production to meet the unprecedented demand for GLP-1 drugs, which help regulate blood sugar and aid in weight loss.
This rapid evolution in drug supply dynamics signals shifting challenges for the telehealth and compounding sectors, as regulatory scrutiny and legal battles mount over the booming market for weight-loss treatments.
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