The loophole in Trump’s obesity drug deal with Eli Lilly and Novo Nordisk
Drugmakers offered GLP-1 discounts in exchange for more volume. They mostly got volume
By John Wilkerson
June 30, 2026
John Wilkerson, a Washington correspondent, is the author of D.C. Diagnosis, a twice-weekly newsletter about the politics and policy of health and medicine.
WASHINGTON — The Trump administration’s grand bargain with drugmakers on GLP-1s was based on a simple premise: lower prices in exchange for higher sales volume. Instead, the companies secured higher volume without the lower prices in some cases.
When President Trump’s team of negotiators got Eli Lilly and Novo Nordisk to agree to a monthly $245 price in Medicare and Medicaid in November, that price was supposed to be for all GLP-1s, including those for obesity, which until then had not been covered by Medicare.
But that price was contingent on private Medicare insurers agreeing to cover the drugs for all uses, with a $50 copay. The administration did not publicly mention that condition, but Novo and Lilly recently confirmed it to STAT.
The plan was for insurers to voluntarily join a pilot program called BALANCE. But in the end, insurers refused, so instead, Medicare is covering GLP-1s approved for weight loss outside of the Part D benefit in a separate pilot program called Bridge. Bridge starts on July 1 and runs until the end of 2027.
Bridge applies only to obesity drugs, so drug companies can continue selling GLP-1s at higher prices for other conditions. That’s one of the biggest shortfalls of the Bridge program, according to a paper by Stacie Dusetzina, a health policy professor at Vanderbilt University Medical Center.
“The most obvious concern is that the potential savings associated with a lower negotiated price for all GLP-1 fills in Medicare Part D will not be realized,” Dusetzina wrote in the New England Journal of Medicine. “Instead, the Bridge will provide access to GLP-1s for expanded indications without any new price concessions for existing use.”
Still, even as the administration touted its deal, the conditions were already ripe for GLP-1 prices to fall. Manufacturing capacity was ramping up to ease supply shortages, some of Novo’s drugs were already subject to Medicare price negotiation, and potential competing drugs were moved into late-stage testing. In late November, Medicare announced negotiated prices of $276.78 a month for commonly used doses of Ozempic and Rybelsus, and $385.63 a month for the highest dose of Wegovy. Those prices go into effect in 2027.
About 16 million seniors are eligible for GLP-1s under current law for treatment of diabetes and cardiovascular disease, according to the Congressional Budget Office, though government data show that only a little more than 3 million seniors took a GLP-1 in 2024.
The CBO estimates that about 12.5 million seniors would be eligible for weight loss drugs. It’s not clear how many will decide to get the drugs via Bridge, but the administration is expected to tout the program as a major affordability issue. Trump has said he wants drug prices to be a top affordability issue for Republicans heading into the midterm elections, and GLP-1s are the flagship of that effort.
The Bridge program also presents an ironic twist. Some seniors who were already eligible for a GLP-1 may pay more for the drugs than those who will be eligible for the drugs for weight loss only. Bridge’s cost sharing is $50 a month. On average, seniors pay $163 to $182 a month for Ozempic. On the other hand, seniors with low incomes would probably pay more in Bridge than they would via Medicare coverage.
The government is expected to spend more on Bridge than it would have on BALANCE, though the administration is mum on the estimated cost of Bridge. The extra cost probably will be borne by taxpayers and Medicare beneficiaries in the form of higher Part B premiums in future years, Dusetzina wrote.
It’s not clear what will happen at the end of next year when the Bridge program expires. There isn’t much incentive for insurers to participate in BALANCE, and drugmakers are better off in Bridge, too.
Administration officials have said that the Bridge program will help plans prepare for BALANCE by demonstrating how much it would cost to cover GLP-1s for obesity.
But insurance companies don’t have much time to prepare for 2028. Each year, Medicare issues a rule regulating Medicare Advantage and prescription drug plans that sets limits on premiums and other aspects of coverage. Medicare must publish the proposed version of that rule for 2028 coverage by late November of this year.
Elaine Chen contributed reporting.
