Eli Lilly and Novo want to shake off Ozempic copycats. Are they ready to meet demand?

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Subscribe to enjoy similar stories. Pharmaceutical companies are typically rewarded for their innovation with years of market exclusivity before cheaper generics enter the scene. But for diabetes and obesity drugs like Ozempic and Zepbound, known as GLP-1s, cheaper copycats emerged almost immediately.

This is due to a provision that permits drug compounders to produce copies during periods of shortage. For GLP-1s, supply constraints have persisted ever since Wegovy’s approval for obesity in 2021, giving rise to a booming market for compounders. That window for mass drug compounding, however, could start to close if the FDA upholds its recent determination that tirzepatide, the active ingredient in Eli Lilly’s Zepbound and Mounjaro, is no longer in short supply.

Although the FDA declared the shortage resolved a month ago, it is currently reassessing its decision after facing a lawsuit from a compounding trade group. An update is expected on Thursday. It is possible the FDA could reverse its decision or give compounders more time.

The nomination of Robert F. Kennedy Jr.to serve as secretary of Health and Human Services, which has jurisdiction of the FDA, adds some uncertainty to what might happen under the Trump administration, given Kennedy’s skepticism of big pharma and GLP-1s in particular. Nonetheless, the days of mass compounding appear to be waning.