Biden’s GLP-1 expansion plan to cut costs and expand access faces Trump uncertainty
US President Joe Biden wants to lower costs and expand weight-loss medications to obese patients without other medical conditions. ING (the Internationale Nederlanden Groep) research says if President-elect Trump approves the proposal, it could increase consumer access and reduce household costs, impacting supply and long-term healthcare.
The plan would cover an additional 7.5 million people from 2026 onwards — 3.5 million over 65 under Medicare and 4 million lower-income Americans under Medicaid.
Biden’s administration claims the proposal could cut costs by 95% as current out-of-pocket costs can reach US$1,000 monthly.
ING analyzes potential response
ING says “it is not certain” whether Trump’s administration would finalize Biden’s proposal. The Senate has not finalized cabinet picks, such as Robert F. Kennedy Jr. for health.
Kennedy Jr. previously criticized Novo Nordisk and other pharmaceutical products, saying that he would rather stress the importance of food quality and nutrition.
Meanwhile, Trump nominee for heading Centres for Medicare and Medicaid Services, Mehmet Oz, is a public Ozempic proponent. ING notes that Tesla CEO Elon Musk, who was nominated to co-lead the Department of Government Efficiency, has also been vocal about using weight loss drugs despite supporting government budget cuts.
The bank stresses that preventive measures should be used in addition to GLP-1 medications, considering that efforts to prevent obesity do not benefit those who are already impacted.
Pooja Passi, head of Insight, Advanced Nutrition at Fonterra, recently told Nutrition Insight GLP-1 will be one of the top trends in 2025. She said three out of ten consumers who are aware of these prescription weight-loss medications express a strong desire to use them, and another 25% show some interest in them.
“GLP-1 drugs come at a high cost, which is a barrier to adoption for many consumers who require weight management solutions.”
ING says it is preferable and more economical to cover weight loss medications, provided that accessibility for diabetics is protected.Meanwhile, product innovation around GLP-1 weight loss treatment has been ramping up, as evidenced by supplement brand activity. Data cited by AI-based weight loss program Allurion Technologies Allurion highlights the market opportunity for GLP-1s in the US, which is expected to exceed US$100 billion with 30 million total users by 2030.
Obesity rates and healthcare costs
About 6% of adults in the US are currently taking GLP-1 medications with a prescription, and 13% of adults have used one in the past, according to ING.
Recent US National Health and Nutrition Examination Survey show obesity rates have declined since the introduction of weight-loss drugs — 42% of adults were obese in 2020, dropping to 40% last year. However, this number is still higher than the 36% obesity rate from 2010.
ING says college-educated Americans are most likely to have access to GLP-1s, but if prices were to decrease, demand would increase. The White House believes the widespread use of GLP-1s will enable healthier lives while reducing healthcare costs.
ING research has also found annual weight loss drug costs are higher in the US than in Europe. It notes healthcare costs also only account for 25% of the total societal costs of obesity. “As societies age and obesity rates increase, these costs are set to continue rising.”
For instance, Ozempic costs in Germany and the Netherlands reach €1,100 (US$1,156) while costs reach €10,100 (US$10,618) in the US.
Biden’s plan would give an additional 7.5 million people access to weight-loss drugs.According to ING, it is preferable and more economical to cover weight loss medications as soon as possible, provided that accessibility for diabetics is protected and that preventative measures are also implemented.
Investment and shortages
ING believes supply for GLP-1s for diabetics shows promise but needs continuous monitoring and adaptive strategies.
This is because the FDA recently declared that semaglutide, the active ingredient in Novo Nordisk’s GLP-1s, is now available and that tirzepatide, the active ingredient in Eli Lilly’s GLP-1s, is no longer in short supply.
Novo Nordisk has also invested US$4 billion for a new GLP-1s US production facility, and Eli Lilly made a similar US$5 billion investment in a similar plant.
However, the bank says if demand skyrockets due to Biden’s proposal, there may be shortages that could impact diabetics.
While current measures and investments by Eli Lilly and Novo Nordisk show promise in meeting increased demand, continuous monitoring and adaptive strategies will be essential to ensure a stable supply of GLP-1s for diabetics.
