Administration Strikes Deal on GLP-1 Drug Pricing and Coverage

Action: On November 6, the White House announced a framework with leading pharmaceutical manufacturers to reduce prices and expand public-program coverage for glucagon-like peptide-1 (GLP-1) medications from Eli Lilly and Novo Nordisk, used in treating diabetes and obesity. Under the agreement, Medicare and Medicaid will pay approximately $245 per month, while Medicare beneficiaries will have an out-of-pocket cost near $50 per month. A new Federal direct-to-consumer (DTC) platform, TrumpRx, will offer discounted cash-pay prices beginning at around $350 per month, with a glide path to $250 over two years. Future oral GLP-1s are targeted at $149 per month, pending FDA approval.

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Under the new framework, Medicare Part D coverage for anti-obesity medicines will be expanded through a pilot program designed to include a majority of beneficiaries, offering access to Eli Lilly’s Zepbound^®(tirzepatide) and, pending FDA approval which the company expects by March 2026, orforglipron^®, alongside Novo Nordisk’s Wegovy^®and Ozempic^®, at prices up to 400% below current US list levels, depending on coverage. Beneficiaries will pay a fixed $50 copay, and states may opt in through Medicaid at the same $245 rate.
These agreements advance the Administration’s broader campaign to lower drug costs through voluntary, “most-favored-nation-style” pricing, building on earlier arrangements with Pfizer and AstraZeneca. They reflect the President’s May Executive Order and subsequent letters to pharmaceutical companies emphasizing public-private collaboration on pricing over statutory price controls.
The TrumpRx platform will enable patients to purchase medications out-of-pocket without going through insurance and is set to debut in early 2026. Eli Lilly also announced it will expand its own DTC channel eventually to include Zepbound^®, orforglipron^®, and other diabetes and migraine drugs at 50–60% below the US list price. Novo Nordisk’s pilot within Medicare Part D will cover most beneficiaries and mirror the same prices for the Medicaid and cash-pay channels.
Earlier this year, both companies submitted public comment expressing concern on the impact of Section 232 tariffs on their businesses and underscoring their domestic manufacturing commitments. The agreement provides the companies with tariff relief for three years, a similar outcome from agreements with other pharmaceutical manufacturers.
As GLP-1 adoption accelerates, key questions about the initiative, including around implementation, eligibility, state participation, and oversight remain unresolved.
What This Means for Business: These agreements signal an expansion of Federal drug-pricing strategy, complementing price negotiation efforts under Medicare with frameworks seeking to reduce the fiscal burden of chronic disease. Expanding DTC channels would have implications not only for drugstore chains and pharmacy benefit managers but also for health insurers, who might change pricing and formularies of covered drugs to reflect this change in distribution.

Administration Strikes Deal on GLP-1 Drug Pricing and Coverage

November 18, 2025

Trusted Insights for What’s Ahead^®

Under the new framework, Medicare Part D coverage for anti-obesity medicines will be expanded through a pilot program designed to include a majority of beneficiaries, offering access to Eli Lilly’s Zepbound^®(tirzepatide) and, pending FDA approval which the company expects by March 2026, orforglipron^®, alongside Novo Nordisk’s Wegovy^®and Ozempic^®, at prices up to 400% below current US list levels, depending on coverage. Beneficiaries will pay a fixed $50 copay, and states may opt in through Medicaid at the same $245 rate.

These agreements advance the Administration’s broader campaign to lower drug costs through voluntary, “most-favored-nation-style” pricing, building on earlier arrangements with Pfizer and AstraZeneca. They reflect the President’s May Executive Order and subsequent letters to pharmaceutical companies emphasizing public-private collaboration on pricing over statutory price controls.

The TrumpRx platform will enable patients to purchase medications out-of-pocket without going through insurance and is set to debut in early 2026. Eli Lilly also announced it will expand its own DTC channel eventually to include Zepbound^®, orforglipron^®, and other diabetes and migraine drugs at 50–60% below the US list price. Novo Nordisk’s pilot within Medicare Part D will cover most beneficiaries and mirror the same prices for the Medicaid and cash-pay channels.

Earlier this year, both companies submitted public comment expressing concern on the impact of Section 232 tariffs on their businesses and underscoring their domestic manufacturing commitments. The agreement provides the companies with tariff relief for three years, a similar outcome from agreements with other pharmaceutical manufacturers.

As GLP-1 adoption accelerates, key questions about the initiative, including around implementation, eligibility, state participation, and oversight remain unresolved.

What This Means for Business: These agreements signal an expansion of Federal drug-pricing strategy, complementing price negotiation efforts under Medicare with frameworks seeking to reduce the fiscal burden of chronic disease. Expanding DTC channels would have implications not only for drugstore chains and pharmacy benefit managers but also for health insurers, who might change pricing and formularies of covered drugs to reflect this change in distribution.

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