Weight-loss drug 'could be profitably made for as little as €4.40 a month'  

Ozempic maker Novo Nordisk currently charges almost €925 for a month's supply in the US

'Profit margin is immense,' on drugs like Ozempic, said Melissa Barber, a public health economist at Yale and the study’s corresponding author.

Ozempic could be profitably produced for less than $5 a month, even as maker Novo Nordisk charges almost $1,000 (€925) in the US, according to a study that revives questions about prices for top-selling treatments for diabetes and obesity.

The blockbuster drug could be manufactured for 89 cents to $4.73 (€4.40) for a month’s supply, figures that include a profit margin, researchers at Yale University, King’s College Hospital in London and Doctors Without Borders reported in the journal JAMA Network Open. 

That compares to the monthly US list price of $968.52 (€895) for Ozempic, a weekly injection.

Novo declined to provide production costs for Ozempic and Wegovy, its related drug for obesity. The company said it was making significant investments to ensure the public had access to its widely popular drugs. 

It is making about $6bn in capital expenditures and spending $11bn to acquire production facilities from Catalent as part of those efforts. 

The study extends a line of research showing how steep the US markups are for GLP-1 drugs like Ozempic and Wegovy and underlines longstanding criticism of the prices for diabetes therapies, especially insulin. 

On a per-month basis, Ozempic generally can be produced for less than various forms of insulin, the study found.

“The profit margin is immense,” on drugs like Ozempic, said Melissa Barber, a public health economist at Yale and the study’s corresponding author. 

“There should be a conversation in policy about what is a fair price," she said.  

Novo’s combined 2023 sales of Ozempic and Wegovy topped $18bn. Patents linked to the drugs are likely to expire in June 2033, according to estimates from Bloomberg Law. 

Drug production costs are often shrouded in secrecy, with little clarity on how they relate to prices, if at all. 

Ms Barber and her colleagues used updated estimates for raw ingredient costs and focused on the costs of producing diabetes drugs, including GLP-1 drugs like Ozempic, as well as insulins and various diabetes pills. 

“The goal of this research is to have receipts, to be as transparent as possible,” Ms Barber said.

Novo and other drugmakers slashed US prices for some forms of insulin, a lifesaving diabetes drug, by as much as 75% last year under pressure from the Biden administration. 

By some estimates, however, the reductions made those products more profitable for drugmakers because they eliminated rebates paid to pharmacy benefit managers, the middlemen who negotiate drug prices for payers and employers. 

• Bloomberg