WASHINGTON — Sen. Bernie Sanders, I-Vt., on Tuesday obtained a meager commitment from Novo Nordisk CEO Lars Fruergaard Jørgensen to meet with pharmacy benefit managers to discuss reducing the cost of his blockbuster drugs Ozempic and Wegovy.
During the often tense hearing before the Senate Health, Education, Labor and Pensions Committee, Jørgensen placed the blame for high drug prices on pharmacy benefit managers (PBMs), saying Ozempic and Wegovy would no longer be offered by the middlemen if they had a lower list price.
“A high list price,” he said, “is more likely to lead to better access for patients.”
Sanders, however, said he had recently received written commitments “of all the major PBMs” — UnitedHealth Group’s Optum Rx, CVS Health’s Caremark and Cigna’s Express Scripts — that if Novo Nordisk significantly reduced the list price, they would not remove Ozempic and Wegovy from their formularies or the list of drugs they carry. PBMs work with insurance companies to negotiate discounts or rebates on drugs in exchange for coverage. PBMs have been criticized for pushing patents toward more expensive drugs.
“If Novo Nordisk does indeed follow through on its commitment, will it substantially lower the list price of Ozempic and Wegovy in the United States?” asked Mr. Sanders, who chairs the committee.
Jørgensen initially avoided giving a firm answer, citing numerous complications. “I have to understand what this entails,” he said.
“But I ask you again, are you going to work with this committee and the PBMs?” Sanders asked.
“Yes,” Jørgensen replied.
“No. 2,” Sanders said. “I understand this is complicated. Are you really going to significantly lower prices in this country?”
“If this works in a way that patients have access to more affordable medicines, we need to make sure that actually happens,” Jørgensen said.
Sanders has been outspoken in his frustration with the price Novo Nordisk charges Americans for Ozempic (used to treat type 2 diabetes) and Wegovy (approved for weight loss).
“In general, we pay by far the highest prices in the world for prescription drugs. The same drug sold in Canada, in Europe, costs a fraction of what it costs in the United States,” Sanders said in an interview Monday. “The result is that hundreds of thousands of people in this country who desperately need this product will not be able to afford it.”
A previously published report by the commission showed that the cost of Wegovy is significantly lower in European countries: from $140 per month in Germany to $92 per month in the UK. Americans pay about $1,349 per month for exactly the same drug.
In his opening statement Tuesday, Jørgensen defended the drugmaker’s pricing structure.
“Type 2 diabetes costs the United States an estimated $413 billion a year, and obesity costs the United States $1.7 trillion. We all know the physical and emotional toll these diseases take,” he said. “That’s why we’re working to get public and private insurance coverage for patients with type 2 diabetes and obesity.”
A report from the Department of Health and Human Services released in February found that in 2022, prices for all drugs in the United States — both brand-name and generic — were nearly three times higher than in other wealthy countries.
Ozempic’s net price has fallen 40% since its U.S. launch, Novo Nordisk said last week. Wegovy, too, is “following a similar trajectory.” Net price is the amount a drug company makes on a drug after discounts and rebates.
Jørgensen was not alone in expressing anger at drug plan managers.
Sen. Tim Kaine, a Democrat from Virginia, said that while he supported the focus on the pharmaceutical industry, “we’re letting PBMs get away with it.”
“One industry does research, one doesn’t. One produces life-saving treatments, one doesn’t,” Kaine said. “One is extremely profitable, one is profitable, but the extremely profitable one doesn’t do any research and doesn’t produce any life-saving innovations.”
The Federal Trade Commission sued Optum Rx, Caremark and Express Scripts in the United States on Friday, accusing them of “artificially” inflating the price of insulin.
Jørgensen said that for every dollar Novo Nordisk makes, the company gives 74 cents to PBMs and insurance companies.
“When we set a list price, we have to take into consideration the discounts we have to pay because, unless we pay a high price, we cannot afford to pay more. “We negotiate rebates with the PBMs, but we don’t have access to the formulary,” Jørgensen said.
That’s why, he argued, higher prices ensure that a PBM will cover Novo Nordisk’s drugs.
Republicans on the committee largely discouraged government pressure to lower the list price.
That could hamper the development of new drugs that could save lives, said Sen. Bill Cassidy, Republican of Louisiana, the committee’s ranking member, using an argument often echoed by the pharmaceutical industry.
“Without a profit motive, without something in return, it’s not certain that these drugs, or any drugs, will be developed,” Cassidy said.
