Is Trump Going to Kill the GLP-1 Cash Cow?

"GLP-1 drugs have reshaped the pharmaceutical landscape, turning obesity and diabetes treatments into massive revenue streams for Novo Nordisk ( ) and Eli Lilly ( ). These medications, including NVO's Ozempic and Wegovy, and LLY's Mounjaro and Zepbound, mimic hormones to curb appetite and regulate blood sugar. Their popularity exploded in recent years as social media influencers and celebrities touted dramatic weight loss results. Demand surged, with global sales topping $20 billion in 2024 alone, propelling both companies to record profits."

"For NVO, GLP-1 products accounted for over 60% of revenue last year, boosting net income by 25% and driving its market cap past $500 billion. LLY saw even sharper gains, with Mounjaro sales jumping 70% quarter-over-quarter, contributing to a 40% stock rise in 2024. This cash cow funded expansions, like NVO's $4.1 billion U.S. manufacturing plant and LLY's $6.5 billion Houston facility."

"Demand spiked prescriptions to 15 million weekly in the U.S. by mid-2025, despite shortages easing after Food & Drug Administration (FDA) delistings in early 2025. Localized stockouts persisted briefly , but supply stabilized. High list prices - around $1,000 monthly, though rebates lowered net costs - funded NVO's $4.1 billion U.S. plant and LLY's $6.5 billion facility, cementing their cash-cow status."

"Yesterday, though, President Trump ignited fear the cash cows were going to be led to slaughter. During a White House event on drug pricing and fertility treatments, he targeted GLP-1s directly: "I was referring to Ozempic, or the fat loss drug...They'll be much lower." Pressed on specifics, Trump affirmed prices could drop to $150 out-of-pocket monthly from current levels, adding they would "come down pretty fast.""

GLP-1 medications such as Ozempic, Wegovy, Mounjaro and Zepbound generated blockbuster demand by curbing appetite and regulating blood sugar, fueled by celebrity and social-media attention. Global sales exceeded $20 billion in 2024, with GLP-1s representing over 60% of Novo Nordisk's revenue and boosting net income by 25%, while Eli Lilly saw rapid Mounjaro growth and a 40% stock rise. Revenues financed large U.S. manufacturing investments totaling billions. U.S. prescriptions climbed to 15 million weekly by mid-2025 amid temporary localized shortages, and high list prices around $1,000 monthly persisted despite rebates lowering net costs. Political statements signaled potential rapid price reductions to as low as $150 out-of-pocket monthly.

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