Weight-loss drug boom sparks battle over pharmacy copycats

The big picture: Both legitimate and illegitimate companies have raced to fill the gaps in GLP-1 obesity drug availability by making copies of their active ingredients — semaglutide and tirzepatide — at a much lower price than the branded drugs.

• Compounders say they're improving access for people who have been prescribed GLP-1s for diabetes and obesity but are still scrambling to find the drugs.
• But it's also created regulatory headaches for states, that oversee compounding pharmacies, prompted consumer warnings from the FDA, and sparked multiple lawsuits from Lilly and Novo Nordisk seeking to protect their market share.
• A recent study found that nearly half of the online pharmacies selling anti-obesity drugs were doing so without a license from their state board of pharmacy.

Zoom in: Lilly announced last month its drugs were "commercially available" and pushed for compounders to stop producing and marketing their own versions of the active ingredient of its diabetes drug Mounjaro, as well as Zepbound.

• Lilly also recently announced a move to offer a cheaper version of Zepbound.

Yes, but: The drugs from Lilly and Novo are still on the FDA shortage list so compounders have continued producing GLP-1s.

• Even when the drug shortage ends, the companies say they intend to continue making versions of the active ingredients of these drugs using another FDA regulatory pathway that allows for personalization.
• In that scenario, a doctor can prescribe a compounded drug with a tweak — such as a different dosage, and added or subtracted ingredient — that they say would make a clinical difference for a patient.
• For instance, some compounding pharmacies have advertised a combination of semaglutide, the active ingredient in Wegovy, and Vitamin B6 or B12 to combat the side effects of nausea.

Between the lines: Some have characterized compounding of drugs as a loophole but it's not, said Scott Brunner, CEO of the Alliance for Pharmacy Compounding.

• "It is absolutely intentional policy on the part of FDA."
• There does seem to be a disconnect in the regulatory framework, however, that could be exposed as compounders shift to making these personalized versions, he adds.

• "That has yet to really be adjudicated. The problem for pharmacies is, it [isn't] the prescriber who's going to get into trouble."

The other side: Critics say the regulatory policy that allows compounding was never intended to be used for the mass production and marketing of new drug copies.

• "We've never done this before in healthcare, right? To me, this is like a gigantic, huge scientific experiment," said Angela Fitch, immediate past president of the Obesity Medicine Association, which put out a statement warning against compounded GLP-1s.
• She added that among the concerns is the lack of FDA regulation of specific drugs and the potential variation in the quality of sourcing for the active ingredients.
• While FDA policies are in place to ensure compounding can be done in a safe manner and "serve an important medical need for certain patients, they also present a risk because compounded drug products are not FDA-approved," the FDA said in a statement to Axios.

What we're watching: Eli Lilly and Novo Nordisk have already filed a flurry of lawsuits.

• Novo told Axios it's already filed 39 legal actions and said it's filing seven more lawsuits, and Lilly told Axios in a statement that it's exploring "all options."
• "FDA has stringent rules for anyone mass-producing or selling drugs, and there's very important patient safety reasons for that," Lilly said in a statement.