Shortage of Semaglutide, US Compound Pharmacy to Copy Up

Shortage of Semaglutide, US Compound Pharmacy to Copy Up

On October 22, 2024, Novo Nordisk, a world-famous pharmaceutical enterprise, submitted a request to the US Food and Drug Administration (FDA) to prevent compound pharmacies from producing fake versions of Semaglutide, a GLP-1 drug used for the treatment of diabetes and obesity, including Ozempic and Wegovy. The company proposes that these drugs should be included in the FDA's Demonstrable Difficulties for Composing (DDC) list due to their complex formulation, delivery mechanism, dosage form, bioavailability implementation, compounding process, as well as physical, chemical, and analytical testing characteristics.

Why does the United States allow counterfeiting, while China's generic drugs have not yet been approved?

This news has raised a question: why can knockoffs be carried out in the United States, while generic drugs in China have not yet been approved. Once a drug is included in the US shortage drug list, combination pharmacies can engage in counterfeiting, which is considered a social error correction mechanism to ensure drug accessibility. Semaglutide and tirzpatide were listed as scarce drugs in August 2022 and 4 months later, respectively, so both GLP-1 weight loss drugs are facing the problem of being copied

What are the reasons for counterfeiting?

In addition to drug shortages, drug prices are another important factor driving the production of counterfeit drugs. The availability of composite GLP-1 agonists increases the opportunity for patients to obtain these drugs at lower economic costs. Many insurance companies do not cover branded GLP-1 agonists used for weight loss, and the 28 day dose of tirzpatide (Mounjaro, Zepbound; Eli Lilly) is approximately $1060. The prior authorization procedures required by certain insurance companies can pose additional barriers to GLP-1 agonists used for weight loss. In addition, there are no generic drugs of GLP-1 agonists on the market. Many combination pharmacies can offer GLP-1 agonists at prices as low as $149 per month, with a price reduction of 86%, which is undoubtedly a huge attraction for patients.

Why stop counterfeiting?

Economic benefits are the main consideration. GLP-1 agonists are one of the most widely used drugs in the United States. According to a recent KFF survey, one in eight adults (12%) reported having used GLP-1 agonists. It is currently unclear how many people are using knockoff versions of tirzpatide and semaglutide, as these prescriptions are not tracked through traditional channels. Evan Seigrim, an analyst at BMO Capital Markets, a financial firm, stated that some estimates suggest that compound versions of prescriptions account for up to 20% of all drug prescriptions.

Scott Brunner, CEO of the Alliance for Pharmacy Compound, estimates that millions of people may be using the compound version. If this estimate is used, Novo Nordisk and Eli Lilly may lose up to $24 billion annually ($2 million * $1000/month * December). In the first half of 2024, the sales of Novo Nordisk semaglutide and tirzpatide were $12.9 billion and $6.656 billion, respectively. Based on a 20% estimate, the six-month loss is nearly 4 billion US dollars, with an annualized loss of 8 billion US dollars. Therefore, they have a strong motivation to prohibit shanzhai behavior.

Can the FDA effectively curb the counterfeit drug market?

In the pharmaceutical industry, the proliferation of counterfeit drugs has always been a challenge faced by regulatory agencies. Recently, the FDA (Food and Drug Administration) has made some progress in combating this issue, with Eli Lilly's case being particularly noteworthy.

The FDA has recently expressed concerns about the combination of semaglutide and tiltrotide. Due to dosage calculation errors, including patients measuring doses beyond expectations and healthcare providers making errors in calculating doses, adverse events have occurred. In addition, some patients have taken doses of compound semaglutide (such as Ozempic produced by Novo Nordisk) or tilpotide that exceed FDA approved standards. Moreover, some compound semaglutide products contain salt form rather than base form, which is inconsistent with FDA approved drug formulations.

The FDA has also reported other safety issues, including illegal online sales, counterfeit Ozempic, and unapproved versions of drugs containing semaglutide, tirzpatide, or experimental retatrutide, which are falsely advertised as "research only or non edible".

In December 2022, the FDA included tirzpatide in the drug shortage list and subsequently met the needs of numerous patients through composite and outsourced facilities. According to the FDA, although the shortage status of tirzpatide was updated to "resolved" on October 2, 2024, GLP-1 agonists semaglutide and tirzpatide still face shortages. After the FDA announced the resolution of the shortage of tirzpatide, compound pharmacies were prohibited from accepting new orders and had 60 days to complete existing prescriptions.

However, on October 7, 2024, a composite trade group filed a lawsuit against the FDA, claiming that the FDA ignored evidence of insufficient drug supply and did not follow reasonable rule making procedures in the decision-making process. The FDA has requested a suspension until November 21, 2024, in order to reassess and consider its decision to remove tirzpatide from the shortage list. During the suspension period, the FDA will not take any action against compound pharmacists who file lawsuits.

Although the FDA's actions demonstrate its determination to curb the counterfeit drug market, it seems that the production and sales of counterfeit drugs have not completely stopped at present. At the same time, Novo Nordisk has adopted a different strategy, requesting the FDA to include it in the list of provable composite difficulties, and has requested the FDA to convene an advisory committee to review this matter.

The outcome of this struggle is still unclear, but undoubtedly, the FDA plays a crucial role in protecting public health and maintaining order in the drug market. With the progress of legal proceedings and the continuous adjustment of regulatory policies, we will closely monitor the latest developments in this field.