Drug shortages

Eli Lilly is aggressively ramping up its manufacturing capacity for tirzepatide as compounding pharmacies continue to challenge an FDA decision to formally end the shortage of the obesity and diabetes drug.

In recent months Novo Nordisk has invested several billions of dollars to boost its manufacturing capacity—including its highly contested $16.5 billion merger with CDMO giant Catalent.

Currently, Eli Lilly’s GLP-1 drugs Mounjaro and Zepbound (tirzepatide) are not on the FDA’s shortage list but compounded pharmacies are still making them. That’s unprecedented.

Wednesday’s update to the regulator’s drug shortage database is good news for Novo Nordisk, which has struggled to keep up with demand for the blockbuster GLP-1 drugs.

Novo Nordisk has nominated semaglutide for inclusion in the FDA’s Demonstrable Difficulties for Compounding list, which includes drugs that are too complicated to produce and could pose substantial safety risks to patients if manufactured incorrectly.

Monday’s lawsuits from Eli Lilly are the first to be filed by the pharma since the regulator officially removed tirzepatide from its drug shortage database earlier this month.

While the regulator conducts another review into the supply of Eli Lilly’s tirzepatide, compounders will be able to continue selling their own remixed versions of the blockbuster drug.

Scaling GLP-1 manufacturing capacity remains a key priority for the pharma industry, to help supply catch up with the insatiable demand for weight loss drugs.

BMO Capital Markets analyst Evan Seigerman called it “another positive indication” for Eli Lilly, whose top-selling diabetes and weight loss drugs are gaining market share as manufacturing continues to expand, while noting the drugmaker could start to benefit heading into third quarter earnings.

Big Pharma has finally gotten its arms around something advocates have wanted for a long time: direct-to-consumer sales. Eli Lilly and Pfizer are leading the way.