Eli Lilly is trading down 3% in late Friday morning trading after the pharma did not receive a National Priority Review voucher for its oral GLP-1 asset, orforglipron, and President Trump made remarks about reducing the price of a rival obesity treatment.
On Thursday, the Commissioner’s National Priority Voucher pilot program awarded nine vouchers to drugs considered to either fill an unmet medical need, address a public health crisis, promote domestic manufacturing, or lead to cheaper costs. The scheme cuts review time to 1-2 months from the usual 10-12.
Also, during a press conference in the Oval Office to announce price cuts for in vitro fertilization drugs, Trump hinted that he is eyeing discounts for Novo Nordisk’s (NVO) Ozempic (semaglutide), approved for type 2 diabetes but used off-label as a weight loss therapy.
Calling Ozempic the “fat-loss drug,” the president said that its price could be lowered to $150 a month. Novo currently offers Ozempic, and its weight-loss approved drug Wegovy, for $499 a month for cash-paying customers through its NovoCare pharmacy.
CMS Administrator Mehmet Oz, however, noted that negotiations to lower the price of Ozempic and other weight-loss drugs is still ongoing.
Street analysts appeared to be more concerned with the potential price reduction for Ozempic and other obesity treatments than the orforglipron voucher snub.
JP Morgan’s Chris Schott, who rates Lilly overweight, said that it is unclear whether Trump’s comments on Ozempic are related to his “Most Favored Nation” pricing program or Inflation Reduction Act pricing negotiations. Still, he said that investors are expecting Ozempic to eventually be priced at $150-$200 a month.
Cantor’s Carter Gould noted that Lilly’s share price decline may be the result that investors were expecting the negotiated price of semaglutide under the IRA to be in the mid-$200s range. He also has Lilly at overweight.
“We continue to view any ultimate negotiated Most Favored Nation (MFN) price as more of a headline risk versus a true fundamental change to Lilly and Novo’s businesses,” added BMO Capital Markets’ Evan David Seigerman, who rates Lilly outperform.