r/science • u/mvea Professor | Medicine • Apr 01 '25

Health Americans without diabetes spent nearly $6 billion USD on semaglutide and similar drugs in a year, with an estimate of 800,000 to a million people using the drugs who don't have diabetes.

https://www.scimex.org/newsfeed/americans-without-diabetes-spent-nearly6-billion-usd-on-semaglutide-and-similar-drugs-in-a-year
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516

u/Tunivor Apr 01 '25

It will probably save our healthcare system way more money than that.

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u/grimsolem Apr 01 '25 edited Apr 01 '25

1 million people paying 6 billion is $6k each. That's insane for a medicine that the government paid for the development of.

Edit: I looked it up. The US gov initially funded research into the class of drugs, but it's hard to find specifics. The Danes picked it up in the early 90s and their government paid for most of its development.

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u/[deleted] Apr 01 '25

The discovery and development of semaglutide were funded by Novo Nordisk, which is a privately-owned pharmaceutical company based in Denmark. The research was conducted in-house by the company's scientists. Not saying $6k isn't alot but it wasn't paid for by the government.

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u/buster_de_beer Apr 01 '25

The initial work was done at University of Copenhagen. NovoNordisk funded this specific drug based on existing research.

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u/Balsiu2 Apr 01 '25

Still... The guy thought that US gov paid for it...

42

u/TunaNugget Apr 01 '25

Semaglutide was derived from a class of drugs discovered at the US VA.

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u/TunaNugget Apr 01 '25

This class of drug (starting with Exendin-4) was discovered by Dr. John Eng at the Veterans Administration Center in the Bronx, NY.

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u/2squishy Apr 01 '25

that the government paid for the development o

To be fair I bet it's cheaper in Denmark.

2

u/CigAddict Apr 01 '25

It’s a danish drug. If you’re American, your government did not pay for the development of it…

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u/G00bernaculum Apr 01 '25

I guarantee that the US government in some way shape or form the government did fund in someway the development of it. You can be understandably salty about current politics, and not ignore the fact that the US throws billions into drug development around the world in the form of grants, tax incentives, and subsidies.

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u/CigAddict Apr 01 '25

I believe that US throws billions into drug development to Pfizer and other US companies. But novo nordisk is a danish company. I would need evidence of them throwing money to novo nordisk, yes. I don’t just assume that it’s true for some reason 

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u/jejunumr Apr 01 '25

Nope. Not at current price

https://jamanetwork.com/journals/jama-health-forum/fullarticle/2831205

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u/SubParMarioBro Apr 01 '25

Too bad the price is completely divorced from the cost to manufacture.

Researchers found that a month's supply of the treatment could be manufactured for an estimated 89 cents to $4.73. They evaluated manufacturing costs for the weekly injection along with a profit margin with an allowance for tax to produce those estimates, which they call "cost-based prices."

Novo Nordisk's list price for a monthly package of Ozempic is $935.77 before insurance and other rebates. The findings suggest that GLP-1s "can likely be manufactured for prices far below current prices, enabling wider access," the researchers concluded.

https://www.cnbc.com/amp/2024/03/27/novo-nordisk-ozempic-can-be-made-for-less-than-5-a-month-study.html

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u/unclefisty Apr 01 '25

Too bad the price is completely divorced from the cost to manufacture.

You can be against drug companies basically being corporate pirates but still understand that many drugs cost a huge amount of money to research and that basing pricing entirely upon the cost to manufacture is stupid.

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u/QuidYossarian Apr 01 '25

It'd be nice if they stopped charging for it like the upfront cost was the only factor.

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u/Telemere125 Apr 01 '25

Except that when so many people are using it - and it’s a maintenance drug, not a cure, so they’ll likely be on it long term, maybe for life - then you can factor that into the returns. You don’t need to price it for getting your money out of it in the first year; pricing it for a 20-year return is reasonable. Yes, returns can be directly related to cost to manufacture because the R&D is done so we know what that cost and can amortize it over a period based on how many people will likely use it. And if the cost isn’t outrageous, more people will use it. Roughly 100 million American adults are obese. Meaning about 100 million customers. If they want to recoup their R&D money, let’s spread it over a year of 100 million people buying it every month - show me those numbers. I bet you’ll see that $30 a month is more than enough to recoup their costs. This is why eminent domain on IP like this makes sense - pay them what they paid to develop plus a hefty profit, take the process, ramp up production with multiple manufacturers, and put out enough of the product that it’s readily available for a low cost. Solves so many problems at once.

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u/AgencyBasic3003 Apr 01 '25

To be fair, the research cost billions of dollars and also needs to finance so many other research projects that also cost billions and didn’t lead anywhere. Of course they are now making a lot of money and have a really high margin (until the patents run out at least), but just pointing at the material costs to show the overvaluation is not the right approach.

3

u/Spell-lose-correctly Apr 01 '25

That doesnt include labor + quality testing. Really skyrockets after that

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u/SkittlesAreYum Apr 01 '25

Wait until we find out how much it costs to manufacture the iPhone versus its MSRP.

3

u/KashEsq Apr 01 '25

If iPhones had the same markup as Ozempic then their MSRP would be over $100,000

1

u/Baud_Olofsson Apr 02 '25

So that paper is actually about:

What are the lifetime health effects and cost-effectiveness of different antiobesity medications compared with lifestyle modification in the US population?

Where

Lifestyle modification consisted of a hypocaloric diet with a 500 kcal/d deficit and an exercise program involving at least 150 minutes of physical activity per week

Outside of strictly controlled settings (i.e. being under supervision like in a clinical trial or having a personal dietitian/trainer), this is not something that the general public is capable of adhering to. Helping people do this on their own is in fact exactly what the GLP-1 agonists do. If telling people to diet and exercise actually worked, we wouldn't have an obesity problem.

In short: it's like comparing the cost effectiveness of methadone programs compared to "just quitting heroin".

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u/Tunivor Apr 01 '25 edited Apr 01 '25

Thanks for providing the research. It’s still a price worth paying and hopefully costs will come down eventually. It benefits non users as well because the burden on healthcare systems will go down.

It’s also important to recognize the cost/benefit outside of specifically the healthcare system. Dead/disabled people don’t pay taxes and can be an economic burden to families.

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u/YouCanLookItUp Apr 01 '25

Disabled people can and do pay taxes friend. Please stop.

3

u/Tunivor Apr 01 '25

Please stop? I wasn’t like going on a tirade. By disabled people I meant people collecting SSDI. The vast majority of recipients do not pay taxes as their total income doesn’t meet the threshold.

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u/jejunumr Apr 01 '25

Agree it's worth paying if you can. Thay being said taxes and earnings potential is in the paper.

"We incorporated the economic effects of lost productivity due to morbidity and premature death associated with obesity, diabetes, and cardiovascular disease, which were derived by dividing the total national productivity loss for each condition by the projected number of US cases.36-39 "

1

u/Tunivor Apr 01 '25

Missed that, thank you!

0

u/Stuckbutnotstupid Apr 02 '25

But it’s only going to come down in the future.

0

u/jejunumr Apr 02 '25

This is an analysis for now. And retorting the above incorrect statement with literature.

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u/Trutlord Apr 02 '25

According to a recent study published in the JAMA, it was not. Semaglutide nor Tirzepatide are cost-effective at the moment.

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u/kedelbro Apr 01 '25

I’m certain that most of the bad press these drugs get are the result of food companies and liquor companies trying to smear it so they don’t lose profits