(The Center Square) – Popular weight-loss drugs costing $102 million in 2023 to the state health plan will be dropped beginning April 1.
The projected cost in 2024 is $200 million, the plan’s board says. The panel’s 4-3 decision on Thursday directly impacts roughly 25,000 who have prescriptions for the GLP-1 drugs known by brand names Wegovy, Saxenda and Zepbound.
The indirect impact is to about 700,000 state employees, retirees and their families in the State Health Plan.
“I think our responsibility as fiduciaries is to the state health plan and this is a small number of people we’re talking about relative to all the members,” trustee Rusty Duke said.
The move comes about three months after the board halted new prescriptions in October, but allowed existing prescriptions to continue. Thursday’s vote will end all coverage, including those grandfathered.
State Treasurer Dale Folwell, who oversees the plan, has noted that the Danish multinational company Novo Nordisk that produces the drugs charges only $296 per month for the same product in the Netherlands, despite the fact that some of the medication is manufactured in North Carolina.
The state health plan accounted for 2% of prescriptions for Wegovy and Saxenda produced by Novo Nordisk, and about 2.6% of the company’s North American profits, in the first half of 2022. Novo Nordisk reported the biggest quarterly profits and sales in the company’s history in November, with its GLP-1 drugs accounting for $4.8 billion, or 52% of its $23.6 billion in total revenue, according to Forbes.
The state health plan is facing a projected $4.2 billion budget gap over the next five years. Novo Nordisk has refused efforts to limit coverage to those who need it most or impose restrictions on prior authorization, plan administrator Sam Watts said.
“We either have to cover it for everyone with no restrictions or we simply can’t afford it. That’s the limit they’ve put us in,” he said.
Plan trustees agreed the inability to negotiate lower rates for the drugs with Novo Nordisk through the state’s pharmacy benefits manager CVS Caremark is a problem. Some were against cutting coverage for a “life-saving” drug members depend on while trustees address it.
“I don’t feel like the state employees are the ones that need to pay that price,” trustee Melanie Bush said. “I would really like the board to consider maintaining the status quo and continuing talks with the PBM, or firing the PBM if they’re really colluding with Novo Nordisk.”
In a response emailed to The Center Square, a spokeswoman for Novo Nordic called the decision irresponsible and stated a number of health facts. The response also put a different spin on the negotiation situation.
The company said, “While Novo Nordisk strongly opposes creating new hurdles for patient access to care, we have and will continue to engage with NCSHP officials to address any potential cost concerns.”
While Novo Nordisk strongly opposes creating new hurdles for patient access to care, we have and will continue to engage with NCSHP officials to address any potential cost concerns.
Novo Nordisk did not respond to a request for comment from The Center Square. A company spokesman has described Thursday’s vote as “irresponsible” and urged the State Health Plan to reconsider.
Negotiations with Novo Nordisk and CVS Caremark continue, Watts said, though he described the current status as an “impasse.”
