Australia knocks back application for diabetes drug that could overshadow Ozempic

Australia has knocked back an application to subsidise the diabetes drug Mounjaro but the manufacturer still wants the much-hyped weight loss medication to be available on local shelves by the end of the year.

Mounjaro is an injectable drug made by pharmaceutical giant Eli Lilly, internationally touted as the latest in a series of medications that are transforming weight loss – similar to the Hollywood-boosted Ozempic and its sister drug Wegovy, which are made by Danish pharmaceutical brand Novo Nordisk.

Patients inject Ozempic weekly using ‘pens’ like this.Credit: Alex Ellinghausen

The new generation of drugs were initially developed to treat diabetes, but their weight-loss properties have encouraged doctors to prescribe them “off-label”, meaning for a purpose for which they are not yet approved.

This has sent company profits skyrocketing and lead some health professionals to worry that the injections, which can have side effects, are being taken by people who aren’t overweight and don’t need them.

The Pharmaceutical Benefits Advisory Committee in a July ruling said it did not recommend Eli Lilly’s application for tirzepatide, which is Mounjaro’s active ingredient, to be added to Australia’s Pharmaceutical Benefits Scheme.

It said some methods of taking it were superior for short-term weight loss when compared to semaglutide – the active ingredient in Ozempic, which is on the PBS for diabetes – but not in all circumstances.

The committee said Mounjaro did not meet its requisite cost-effectiveness test, and that the company would need to lower its price significantly for Mounjaro to be considered again.

Eli Lilly is now reviewing the pathway for its product to land on Australian shelves. The company’s Australia and New Zealand general manager, Tori Brown, said while its goal was still to secure reimbursement through the PBS, it will launch the product privately.

“Lilly has decided to launch Mounjaro as a private prescription so that Australian patients with type 2 diabetes can have immediate access to this first-in-class medicine,” she said. It could be available from as early as October.

Off-label Ozempic costs fluctuate from $300 to as high as $600 in Australia, but is $30 when taken for diabetes under the Pharmaceutical Benefits Scheme. In the United States, Mounjaro, Ozempic and Wegovy sell for about US$1000 a month – significantly higher than in other countries, such as Germany, Sweden and France.

Clinical trials sponsored by both companies showed half of their patients lost about 15 per cent of their body weight while taking the injections.

Some of the most common side effects include nausea, diarrhoea, constipation and dehydration.

Both Eli Lilly and Novo Nordisk have seen their stocks hit record heights off the back of the new drugs, with Eli Lilly’s share price rising 24 per cent this month alone as the United States considers approving Mounjaro for weight loss as well as diabetes.

The spike came after the company revealed that sales for Mounjaro reached almost US$980 million in the latest quarter – up from US$16 million when it was introduced a year earlier.

The company’s total value has risen 230 per cent since the beginning of 2021. Novo Nordisk’s stocks have also surged by almost 200 per cent since then, with the company’s other blockbuster weight loss product, Wegovy, already approved for weight management in the United States.

There has been a slower uptake in Australia, since Wegovy and Mounjaro are yet to launch in Australia. While Ozempic is approved for diabetes, its uptake has been limited by global supply shortages caused by the sudden demand for weight loss use.

Novo Nordisk has made a second application for Wegovy to be subsidised in Australia, after it was knocked back by the pharmaceutical benefits advisory committee last year.

Wegovy is a higher dose version of Ozempic that is used mainly for weight loss. The application to list Wegovy on the PBS for severe obesity will be considered at the committee’s next meeting in November.

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