The demand for new weight loss drugs like Ozempic has reached Arkansas, and a variety of health care businesses already feel the impact.
But a future with increased availability of GLP-1 drugs has the industry bracing for even greater change.
Bariatric surgery centers across the country are experiencing a downturn, thanks largely to the emerging class of drugs, and while that trend hasn’t yet reached bariatric clinics in Arkansas — two actually reported record years in 2023 — some doctors see a shift on the horizon.
The use of GLP-1 medications for weight loss is definitely not a fad, said Dr. Joseph Henske, an endocrinologist and director of the diabetes program at the University of Arkansas for Medical Sciences in Little Rock. And Arkansas is among the top states for prescribing these trending drugs, an Axios review of insurance claim data found.
Henske said GLP-1, which regulates appetite, blood sugar and digestion, is one of the first hormones identified as being meaningful in weight loss and effective in clinical practice, but new combination therapies using other hormones, including GIP, glucagon and Amylin, are likely to emerge in the future. These medications, Henske said, have the potential to show weight loss beyond what’s currently seen, about 20% to 25% when using injectable therapies.
“In the future, we may start to see 25%, 30%, 35% weight loss and things that are as effective, if not more effective, than bariatric surgery,” Henske said.
For pharmacies, GLP-1 drugs present a tough equation. With low supply nationwide and a high price tag, margins are slim for pharmacies that choose to dispense the drugs, and some Arkansas pharmacists told Arkansas Business that they lose money each time they fill an order for them.
So why fill them at all? To prevent customers from taking all of their prescriptions elsewhere.
“Specific to these [GLP-1 drugs], if we get paid $30 below cost, I can’t afford to keep them,” said Anne Pace, co-owner of Kavanaugh Pharmacy in Little Rock, adding that “access is going to get far worse for this drug and for every drug.”
Her pharmacy ultimately had to implement a cap on the number of such prescriptions it was filling because it was losing money on almost every one.
“We are having to spend half a million dollars or more a year and make $10,000,” Pace said. “That’s a really hard pill to swallow when we are already not making a lot on these medications.”
Some of these medications cost $1,000 or more per month, so if the pharmacy makes $10 on that, it’s not getting a sustainable return on its investment, Pace said.
Brian Smith, owner of the Prescription Pad Pharmacy in Monticello, said he has to go line-by-line and look at losses to see whether he should fill a patient’s GLP-1 prescription or refer them elswhere, because he is losing anywhere from $30 to $100 on the drug.
The Drugs
Ozempic, Wegovy and Mounjaro are relatively new. The U.S. Food & Drug Administration approved the first GLP-1 drug, exenatide, in 2005.
Ozempic, the name brand for semaglutide, was first approved by the FDA in 2017 to treat Type 2 diabetes. The injectable prescription medicine is used along with diet and exercise to lower blood sugar and reduce the risk of major cardiovascular events.
In 2021, Wegovy, a once-a-week semaglutide injection, was approved for weight loss. The following year brought the approval of Mounjaro (tirzepatide), a prescription medicine for adults with Type 2 diabetes used along with diet and exercise to improve blood sugar (glucose) levels.
Dr. Eric Paul, a bariatric surgeon with Baptist Health Bariatric Center in Little Rock, said he began seeing the rise in GLP-1 meds two to three years ago, and after celebrities began using Ozempic off label for weight loss, the popularity of GLP-1 agonists skyrocketed. Agonists are drugs that bind to a receptor inside a cell, causing the same reaction as the substance that normally binds to that receptor.
“I don’t know of any other situation like this where a new drug has come out and immediately there are shortages for the whole class to where there are compounded products being made for all these drugs,” said Kyle Lomax, CEO and owner of Southern Pharmacy, which operates five pharmacies in northeast Arkansas.
The Surgeons
While bariatric surgery centers in parts of the U.S. are seeing a decrease in procedures because of the rise of GLP-1 drugs, that trend hasn’t yet made its way to Arkansas.
Dr. Samuel Bledsoe, a bariatric surgeon at Arkansas Heart Hospital, which has locations in Little Rock and Bryant as well as clinics throughout the state, said that while the business numbers are out of his purview as a physician, he knows 2023 was a record year for the bariatric surgery service line.
“As we started 2024, we saw a slight dip in numbers, which we expected after such a strong year,” Bledsoe said. “However, we’re starting to see a rebound in patients seeking bariatric surgery. Many patients who tried GLP-1 meds, like Ozempic, are realizing that the cost is prohibitive, the results are less than expected and the side effects are unwanted. This has led them to turn to the only long-term weight loss solution, bariatric surgery.”
Shirley Bearden, the metabolic bariatric program coordinator with Mercy Hospital in Fort Smith, said the hospital’s bariatric program did not actually see a drop in patients last year, noting a 26% increase in bariatric surgeries in 2023.
“In our area, I think that bariatrics is still a very strong need,” Bearden said. “Insurance isn’t covering the GLP-1s medication, and it’s very expensive and it’s not readily available. A lot of people can’t afford it. A lot of people can’t get it. It’s just not available.”
Physicians in the state expect the landscape to change as the cost of the weight loss drugs drops and availability rises. When that will happen remains uncertain.
At present, most insurers, like Arkansas’ largest, Arkansas Blue Cross & Blue Shield, cover Ozempic for diabetes but not weight loss, the same as Medicaid and Medicare.
Bearden said that when she attends events, such as the American Society for Metabolic & Bariatric Surgery conference, she asks representatives from pharmaceutical companies about the shortage and inaccessibility of the medication. She tells them about how many patients she has who are seeking it, and is often met with excuses. The most recent update, which she received during the annual meeting of the American Society for Metabolic & Bariatric Surgery in San Diego, was that there might be some improvement in production by September.
The price of a 30-day supply of Ozempic, according to Novo Nordisk, is $968.52. This is not the price most people pay after rebates or insurance, assuming they have coverage for it. Novo Nordisk told Arkansas Business the company has “substantially lowered the price of Ozempic and Wegovy. Today, 80% of U.S. patients with insurance coverage for Ozempic or Wegovy are paying $25 or less for each prescription, and 90% are paying $50 or less.”
Under current market conditions, the company expects that net prices will continue to decline for both Ozempic and Wegovy, the statement added.
The Alternatives
The shortage of these medications has given rise to compounded alternatives, which can help fulfill prescriptions in the case of a shortage.
Compounded drugs are not FDA-approved, although depending on the circumstances, they can be made and distributed with fewer restrictions when the drug appears on FDA’s drug shortages list.
As of July 1, the FDA has listed the three lowest doses of Wegovy in a shortage due to increased demand.
The FDA regulates the products that can be used to make a compound, and if components are not obtainable from an FDA-registered facility or if the FDA or the company cannot document FDA registration, pharmacists must use their professional judgment in using components to meet requirements.
There is not an approved injectable GLP-1 compound in the United States, according to Spencer Mabry, a pharmacist at Economy Drug in Berryville.
Because it’s an injectable product, the drugs have to be compounded in a sterile environment. John Vinson, CEO of the Arkansas Pharmacists Association, said there are concerns because there is risk that the products may or may not be legitimate depending on where they are sourced from.
“We are only aware of a couple of pharmacies that are making non-sterile GLP-1 compounds in Arkansas at this time, and I do not believe we have any currently making sterile, injectable GLP-1 compounds,” Danyelle McNeill, the public information officer for the Office of Health Communications at the Arkansas Department of Health, said in a statement.
Pace said she had a customer who had an anaphylactic reaction to a compounded semaglutide, requiring the customer to use an EpiPen. Pace said now she doesn’t know if they would have had that reaction to an Ozempic or a branded product because she has not ever dispensed that for them.
“But it is concerning because I couldn’t tell her what the anaphylactic reaction was from, because I don’t know why,” Pace said. “I don’t know what is included in there, and I don’t know what her recourse at that point is.”
Brittany Sanders, a pharmacist at the Pharmacy at Wellington in Little Rock, said she has had patients come in with powder from a “medical spa,” supposedly for weight loss medication, and are looking for ways to reconstitute it.
“It definitely creates an environment where people are looking for a less-expensive alternative, something they have access to, and it can create an unsafe environment for patients,” Sanders said.
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