Senators grilled Novo Nordisk CEO Lars Jorgensen at a hearing on Tuesday about the cost of diabetes drug Ozempic and weight loss medication Wegovy, both of which are often prohibitively expensive in the United States despite their life-saving potential.
Sen. Bernie Sanders (I-VT), the chairman of the Senate Health, Education, Labor, and Pensions Committee, pressed Jorgensen on why the list prices of the medications are significantly more expensive in the United States than in other developed countries.
“All we are saying, Mr. Jorgensen, is treat the American people the same way that you treat people all over the world,” Sanders said to the Novo Nordisk CEO. “Stop ripping us off.”
Sanders compared the $969 per month U.S. list price for Ozempic to the $155 per month in Canada and the $59 per month for the same medication in Germany.
Wegovy, which is the same chemical compound as Ozempic but delivered at a different dose, costs $1,349 per month in the U.S. In Canada and Germany, however, the drug costs $265 and $137 respectively.
Jørgensen responded to Sanders’s questioning by outlining that Novo Nordisk has invested $30 billion to increase production capacity of semaglutide, the chemical compound in both Ozempic and Wegovy, with the intention of bringing down list prices following basic laws of supply and demand.
The price of Ozempic has decreased by 40% since the drug first came to market six years ago, and Novo Nordisk has implemented several programs for low-income Americans to access the medication below the list price.
Patients in the U.S. also typically do not pay the list price for medication as insurance companies are often able to negotiate rebates for drug prices to allow patients to purchase the medication at a discount from the list price.
Jorgensen also said that his company is “committed to make sure that Americans have access at an affordable price point for our medicines.”
“There is a market we have to operate in, and we negotiate hard to make sure that Americans have access,” Jorgensen said, noting that for patients, it is “too often a struggle to navigate the complex U.S. healthcare system.”
Sanders noted in the exchange that, until the Biden administration passed the Inflation Reduction Act in 2022, the U.S. was the only industrialized country not to negotiate the price of prescription drugs directly with pharmaceutical companies.
“In other words, Novo Nordisk and other drug companies, not just Novo Nordisk, can charge us as much as the market can bear, and that is precisely what they are doing,” the senator said.
Sen. Bill Cassidy (R-LA), a physician and the ranking member of the HELP Committee, noted that multiple players in the U.S. healthcare system, including pharmaceutical companies, insurance companies, pharmacies, and pharmacy benefits managers, all play a role in setting the prices of drugs.
“Important to note, while drug manufacturers play a significant role in determining the costs of drugs, the problem is much greater and more complex than the actions of one company. We need to make a serious effort to navigate the network of perverse incentives throughout our healthcare system,” Cassidy said.
Another component of the debate on prescription drug pricing, especially for obesity and Type 2 diabetes, is the high demand for these specialized medications in the U.S.
Nearly 1 in 5 (about 19%) of adults in Germany are medically obese, according to the German Robert Koch Institute. In the U.S., however, about 42% of adults (or over 100 million people) meet the medical standards for obesity, according to the Centers for Disease Control and Prevention.