The federal Medicare agency is expanding access to weight loss drugs under a new temporary program starting Wednesday. Millions of people may be eligible for medication, but it may not lead to an immediate boon for Novo Nordisk and Eli Lilly.
Analysts are watching patient uptake for the 18-month pilot -- known as the Medicare GLP-1 Bridge program -- in light of a lower, $245 price point the companies agreed to last year with the Trump administration for government coverage of obesity drugs.
"I think the market has already incorporated that lower price into their expectations, and now it's a question of whether they're going to be able to recoup that," says Karen Andersen, director of healthcare equity research at Morningstar, referring to Novo and Lilly. In her forecast "we don't currently have a massive bump in revenue in the U.S. for GLP-1 therapies because of" the Bridge program.
Novo's Wegovy injection and tablets are covered by the program, as is Lilly's Zepbound KwikPen formulation and its Foundayo tablets. The Centers for Medicare and Medicaid Services hasn't publicly released cost estimates or enrollment projections for the program, an agency spokesperson said.
BMO Capital Markets analyst Evan David Seigerman recently wrote that Novo's U.S. Wegovy franchise could see incremental revenue from Bridge this year, though more upside is "likely weighted to 2027 and beyond."
Even once it goes live July 1, "operationalization of the program could slow uptake as patients are formally brought into the system," Seigerman said in the client note.
Medicare beneficiaries will have to get a prescription from a doctor and go through a prior authorization process to determine their eligibility. Bridge applies to patients who need a GLP-1 to reduce weight or maintain weight reduction, and who meet certain criteria for body-mass index $(BMI)$ and other medical conditions. Patients are responsible for a $50 copay on the medication and must also be enrolled in Medicare Part D drug benefits.
But, importantly, the program doesn't cover the medication for patients who'd be eligible for a GLP-1 under existing Medicare Part D benefits -- for conditions like Type 2 diabetes, obstructive sleep apnea, and fatty liver disease.
That means the pool of patients who could qualify for Bridge is only a subset of Medicare beneficiaries with obesity.
"There's this narrowing of the potentially eligible population," says Juliette Cubanski, vice president and director of the program on Medicare policy at KFF, a health policy research group.
New estimates from KFF released Monday show that 13.3 million Medicare beneficiaries met BMI levels for obesity or being overweight in 2023, based on claims and encounter data.
Meanwhile, a smaller group -- 3.8 million Medicare beneficiaries -- would have qualified for the Bridge program criteria that same year, according to the analysis.
"That's still a lot of people, but it's not nearly as many people as might otherwise qualify if the program were offered to anybody with obesity, or overweight, in the Medicare program," Cubanski says.
Novo Nordisk and Lilly didn't immediately answer questions Tuesday about company projections for patient eligibility and participation in the Medicare GLP-1 Bridge.
In a statement, Novo Nordisk said it's "committed to helping patients, caregivers, and healthcare professionals navigate this program with confidence."
It remains unclear how the medication would be covered when Bridge ends as scheduled in December 2027. The program is temporary because federal law prohibits Medicare from covering drugs for weight loss.
"What happens at the end of 2027, if there has been no other pathway established for Medicare coverage of GLP-1s for the purpose of weight loss," says Cubanski, "is really a big unknown."
Write to Catherine Dunn at catherine.dunn@dowjones.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
June 30, 2026 16:03 ET (20:03 GMT)
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