Trump says "semaglutide prices will plummet," shares of weight-loss giants Eli Lilly and Novo Nordisk tumble in response.
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U.S. President Trump stated on Thursday that the price of the popular diabetes drug Ozempic may drop to just $150 per month, causing a stir in the market. This statement led to a sharp decline in the after-hours share prices of Eli Lilly and Novo Nordisk.
On October 16, according to reports, Trump said at a news conference in the White House Oval Office that the price of this "weight loss drug" produced by Novo Nordisk would "soon drop significantly," and patients’ out-of-pocket expenses would be reduced to $150. Currently, the listed price of Ozempic in the U.S. is about $1,000 per month. However, Mehmet Oz, head of the Centers for Medicare and Medicaid Services (CMS), immediately clarified that price negotiations are still ongoing and no agreement has yet been reached.
Impacted by this news, Novo Nordisk ADRs once fell 4.7% after hours, and Eli Lilly shares fell as much as 5.3%. This is the latest market reaction to the possibility of pricing agreements by weight loss drug makers, following Pfizer and AstraZeneca.
The Trump administration had previously announced similar agreements with Pfizer and AstraZeneca. Wall Street has long anticipated that the government would take action against major weight loss drug manufacturers.
The report noted that the focus of this news conference was the agreement reached between the government and Germany’s Merck Group, which agreed to lower the price of fertility treatments in exchange for delaying impending pharmaceutical tariffs.
Price negotiations are still ongoing
Although Trump gave a specific price target, actual negotiations have not been completed. Oz quickly intervened at the press conference to clarify: “We have not yet negotiated over these drugs.”
He stated that price negotiations for GLP-1 class drugs, including Ozempic, would be "rolled out gradually" and that no agreements had yet been reached.
Asked about the negotiation timeline, Trump replied that prices would go down "very soon." Oz again emphasized that negotiations with pharmaceutical companies are still ongoing and "will not end until the president is satisfied with the results."
Since Trump sent price reduction request letters to 17 major pharmaceutical companies, Novo Nordisk has been negotiating to lower drug prices. Ozempic and its sister drug Wegovy have also been included in the price negotiation list under the Inflation Reduction Act (IRA), facing additional pressure from the legal framework.
Similar therapies sold by Eli Lilly include Wegovy and Zepbound, which may also be affected by the government’s price reduction efforts.
This statement shows that the Trump administration is using a strategy of trading tariff exemptions for price cuts, expanding from fertility drugs to the highly watched field of weight loss drugs.
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