Providing Medicare Part D coverage for Novo NordiskThe use of semaglutide to reduce the risk of cardiovascular disease in certain patients could cost the U.S. government up to $145 billion annually, according to a new study published Tuesday in Annals of Internal Medicine.

Semaglutide is sold under the brand names Ozempic for type 2 diabetes and Wegovy for chronic obesity. It is a blockbuster GLP-1 receptor agonist that promotes insulin secretion from the pancreas and suppresses appetite. The Centers for Medicare and Medicaid Services (CMS) covers the cost of diabetes therapy, but has not yet covered the cost of its use to combat obesity.

In November 2023, Novo Nordisk published data from the Phase III SELECT study The study showed that a 2.4 mg dose of Wegovy significantly reduced the risk of major cardiovascular events by 20% compared to placebo. In addition, the risk of heart attack or myocardial infarction was 28% lower in patients treated with Wegovy.

The results prompted the FDA expand the approval of Wegovy in March 2024, allowing its use to reduce the likelihood of cardiovascular death, heart attack, and stroke in overweight and obese adults with cardiovascular disease (CVD). Shortly thereafter, CMS announced that it would adopt Wegovy for this use, for patients with a body mass index of at least 27 kg/m²The agency has yet to publish its detailed definition of CVD.

In Tuesday’s study, researchers at Brigham and Women’s Hospital School of Medicine in Boston examined how many patients would be affected by this health insurance change and what potential impact it would have on Medicare.

Using data from the National Health and Nutrition Examination Surveys from 2011 to 2020, the researchers found that around 3.6 million adults would be eligible for semaglutide insurance under the new CMS guidelines. If more liberal definitions of CVD are applied, this insurance population could increase even further, to 15.2 million adults, according to the study.

If all of these new recipients used semaglutide, annual Medicare spending could increase by $34 billion to $145 billion, the researchers found.

Their analysis follows a Report from March 2024 The Congressional Budget Office (CBO) concluded that at current costs – which range from $1,000 to $1,300 for a four-week supply – Medicare will not be able to sustainably cover the cost of semaglutide.

At the time, CBO analysts wrote that obesity drugs like semaglutide would “cost the federal government more than it would save by reducing other health care spending,” leading to an “overall increase in the deficit over the next decade.” Because of the drug’s price and medical value, the CBO also predicted that semaglutide would most likely be selected for Medicare pricing negotiations “within the next few years.”

Wall Street analysts expect Ozempic to be on CMS’s Medicare drug pricing negotiation list in 2027, according to a report last week. Reuters.