Landmark agreement cuts drug prices, expands Medicare access, and grants tariff relief to leading obesity drugmakers
Eli Lilly & Co. (LLY) and Novo Nordisk A/S (NVO) have reached breakthrough agreements with the Trump administration to significantly reduce prices for their blockbuster weight-loss medications in exchange for tariff relief and expanded Medicare coverage. The deal, announced Thursday at a White House event with President Donald Trump, represents a major policy shift in how the U.S. government approaches obesity treatment and pharmaceutical pricing.
Under the new arrangement, Medicare will now cover Lilly’s Zepbound and Novo’s Wegovy for certain patients with obesity and related health conditions, including prediabetes and heart failure — a historic reversal of long-standing federal restrictions. Beginning next year, eligible patients will pay just $50 per month in co-pays, while the base monthly price will fall to $245. The move effectively opens access to drugs that currently retail for over $1,000 per month.
In return, both companies will receive a three-year exemption from upcoming tariffs on pharmaceutical imports, as well as fast-track reviews for their forthcoming oral weight-loss treatments, expected to launch next year at $149 for the lowest dose. Additionally, Lilly and Novo have pledged to expand U.S. manufacturing, aligning with the administration’s “America First” production goals.
Trump hailed the agreement as “a triumph for American patients,” while Novo CEO Mike Doustdar emphasized that the decision will “bring semaglutide medicines to more Americans at a lower cost.” Lilly CEO Dave Ricks called it “a pivotal moment in U.S. healthcare policy,” underscoring the collaborative tone of the negotiations.
The deal follows similar arrangements with Pfizer and AstraZeneca, as the administration pressures pharmaceutical companies to deliver affordable access amid rising costs of living and renewed scrutiny of the healthcare industry.
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