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Why are GLP-1 Drugs So Expensive?

Photo of a 4-week supply of Wegovy syringes in a manufacturer's box.

The high cost of GLP-1 drugs can be attributed to several factors:

Manufacturing complexity:

GLP-1 drugs belong to a class of medications known as "biologics," which are more complex and costly to produce than traditional drugs. Biologics, including GLP-1 agonists, are typically derived from genetically modified animal cells or synthesized using advanced techniques and specialized equipment to create proteins from scratch. This intricate manufacturing process contributes to their higher price.

Patent protection:

Another reason for the high cost of GLP-1 drugs is the active patent protection granted by the government. Patents are legal mechanisms designed to promote innovation by giving pharmaceutical companies exclusive rights to sell their drugs without competition for a specified period (usually 17 and a half years). This exclusivity allows companies to recoup their research and development (R&D) investments and generate profit.

Pricing strategy:

The pharmaceutical companies that produce GLP-1 drugs for weight loss have chosen a pricing strategy that focuses on maximizing profit from a smaller patient population rather than pursuing a lower profit margin across a larger customer base. While the ethics of this approach may be debated, as long as the patent remains active, these companies have the legal right to set prices as they see fit.

In summary, the high cost of GLP-1 drugs can be attributed to their complex manufacturing process, active patent protection, and the pricing strategies employed by pharmaceutical companies. Until patents expire and competition enters the market, it is likely that the prices of these medications will remain elevated.


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