Approved by the US Food and Drug Administration Eli Lilly‘s GLP-1 tablet is a major milestone for the Indianapolis-based drug company and will test the market for new weight-loss drugs, the company said.
Lilly said its once-daily pill, Foundayo, will begin shipping from direct-to-consumer platform LillyDirect on Monday and will be available in pharmacies and telemedicine platforms “soon.” Those with insurance can use Lilly coupons to pay $25 a month, while those who pay out of pocket can pay between $149 and $349, depending on the dose.
The approval comes just months after Lilly submitted the drug to the FDA as part of a program that allows expedited review of drugs deemed of priority national interest. This means Lilly will introduce Foundayo only about three months later than Novo Nordisk’s Wegoby drug, setting the stage for the next battle between rival drug companies on the next frontier of GLP-1 drugs.
“This is a big moment,” Eli Lilly CEO Dave Ricks said in an interview with CNBC. “We’ve obviously been working on this category of medicine for a while, having developed the first GLP-1 treatment 20 years ago, and we’ve continued to improve it ever since. The options here are not more effective… but they’re more accessible and easier to incorporate into daily life.”
Lilly licensed the molecule, orforglipron, from Japanese pharmaceutical company Chugai Pharmaceutical in 2018, paying just $50 million upfront for worldwide rights to the drug. But questions remain about how big the drug will be. There’s no weight loss like Lily’s best-selling shot, Zep Bound. Millions of people have already gotten into the habit of injecting themselves once a week.
Eli Lilly Foundayo GLP-1 weight loss drug.
Provided by: Eli Lilly
Analysts expect Foundayo’s sales to reach $14.79 billion by 2030, according to FactSet. By comparison, weight loss drug Zepbound is expected to bring in $24.68 billion, and Munjaro, which is marketed for diabetes in the U.S. and obesity and diabetes in other parts of the world, is expected to bring in $44.87 billion.
Ricks said the shot isn’t as much of a learning barrier as Lilly once thought. He still thinks Foundayo is an attractive option for people who want to take a pill or are looking for a lower price than injectables.
He believes it plays a role in maintenance for those who want to achieve their goal weight in shots and keep the weight off. And he sees Foundayo as a way to “reach Earth” without the manufacturing constraints and cold chain requirements associated with Zepbound.
Foundayo is a small molecule, whereas Zepbound and Wegovy are peptides and require a more intensive manufacturing process, a barrier Ricks believes will hinder generic versions of Wegovy, which were recently launched in several other countries, including India.
“(Foundayo) is enabling scalability so we can launch this globally with the first instance,” Ricks said. “So, right now, we have an oral drug (Wegovy) available in the United States, but not really anywhere else. It will be sold around the world. Once we receive regulatory approval, we will essentially have the scale we need to supply the world with an oral GLP-1 inhibitor.”
Lilly expects Foundayo to be approved in more than 40 countries within the next year. The company has invested more than $55 billion in manufacturing since 2020, including opening new sites and expanding existing factories to produce tablets.
In the U.S., Lilly will compete with Novo’s new pill, Wegoby. Early demand for the pill was stronger than expected, with Novo reporting more than 600,000 prescriptions in March.
Novo CEO Mike Doustdar told CNBC in February that one of the earliest learnings from the drug’s launch was that the pill appears to be expanding the obesity treatment market by attracting new patients rather than diverting existing patients from injections. Ricks agreed with that assessment and said Lily doesn’t care whether people take Foundayo or Zepbound.
“We want people to take drugs that meet their health goals,” Ricks said. “If we have Lily in the box, that’s our goal.”
Novo plans to claim that Wegovy tablets are more effective than Foundayo tablets. In another study that analyzed patients who continued treatment, Wegovy’s tablets showed an average weight loss of about 16.6% in late-stage trials, while Lilly’s oral drug caused an average weight loss of about 12.4%. Lilly’s Zepbound has consistently been shown to help you lose over 20% of your body weight.
Lilly, on the other hand, plans to promote the fact that Foundayo can be taken at any time without restrictions, whereas Wigovy tablets only need to be taken first thing in the morning on an empty stomach with a few ounces of water.
If the two drugs are the same, it is the starting price. Thanks to an agreement the companies struck with the Trump administration last fall, the lowest doses of both drugs will cost cash-paying customers $149. And price is the most important factor for patients, said Dr. Nidhi Kansal, a bariatric physician at Northwestern Medicine.
“Unfortunately, price is what drives the decision-making between clinicians and patients about these drugs, because they are all good drugs and there are many options now, but ultimately it is still an economic decision,” Kansal said.
Evan David Sagerman, an analyst at BMO Capital Markets, said the low price and familiarity of the pills and shots are opening up the market to casually interested patients. As part of Lilly and Novo’s deal with the Trump administration, seniors on Medicare will have access to Foundayo and other GLP-1 obesity drugs starting this summer for $50 a month. Ricks expects a “pretty solid” response to the program, which Lilly has factored into this year’s financial outlook.
Analysts say Foundayo’s successful launch will be key for Lilly’s stock to recover from its recent slump. After a meteoric rise that briefly made Lilly the number one health care company by market capitalization, the company’s stock has fallen about 14% this year. Carter Gould, an analyst at Cantor Fitzgerald, said analysts will track prescriptions to monitor pill uptake because sales are a lagging indicator.
“If the script is going in the right direction and we’re seeing continued gains, my guess is that people will weather any disruption (in the first or second quarter),” Gould said.
Another factor in Lilly’s performance this year is the outlook for its more potent obesity drug, ritartide. The company has already shared some late-stage data on its drug, but the most important trial is one specifically studying treatments aimed at weight loss. If letaltortide lives up to expectations, Lilly will be building a portfolio of obesity drugs.
“There will be more options in the future, and that’s great,” Ricks said. “And I hope Lily presents those options.”
