Eli Lilly has escalated its efforts to protect its GLP-1 medications, filing lawsuits against four telehealth companies: Mochi Health, Fella & Delilah Health, Willow Health, and Henry Meds. This lawsuit is an answer to increasing pressures from a burgeoning field of competition amongst new startups. These companies have now received FDA approval to provide compounded counterparts to popular GLP-1 drugs for a fraction of the cost. The stakes couldn’t be higher. Now GLP-1 medications are the most effective and most profitable treatments for obesity and diabetes.
In 2022, Eli Lilly made more than $16.4 billion off of its GLP-1 drugs Mounjaro and Zepbound. The need for these medicines has suddenly and dramatically increased. At last count in November of last year, at least 2 million Americans were actively using them. Consider a leading telehealth provider like Hims — they earned an estimated $225 million just from GLP-1 drug sales last fiscal year.
The lawsuits bring to the forefront significant issues surrounding the safety and efficacy of compounded medications. Last August, Eli Lilly sued Henry Meds. They allege that Henry Meds defrauded consumers by implying that clinical trials had determined its drugs were effective. It accuses Fella & Delilah Health of altering patients’ medications in 2022. They changed from a compounded tirzepatide without additives to a localized production with untested amino acid additives.
The unprecedented demand for GLP-1 medications has not been without its struggles. Zepbound, approved in November 2023 as a treatment for obesity, saw some doses immediately go into short supply. Tough regulatory compliance deadlines have been set on small community pharmacies and newly created larger outsourcing facilities in the name of patient safety. Small pharmacies were given until February 18 to meet these requirements, and larger entities, like compounding facilities, were given until March 19.
Also, semaglutide compounders were recently ordered to stop mass-producing the drug this past spring. The deadline for the smaller compounders was April 22. Outsourcing facilities received a further extension until May 22 to discontinue their compounding operations. Regulatory scrutiny ramped up further when Washington state regulators ordered Aequita Pharmacy to stop producing drugs in March. This decision came on the heels of deep safety violations related to GLP-1 drugs.
Nicole Snow, a spokeswoman for a rival telehealth firm, pointed to the massive scope of what’s happening as truly unprecedented. “We’d seen it from time to time, but not in this magnitude,” she stated regarding the rise of telehealth providers offering compounded medications. That landscape has changed dramatically. Snow remarked, “It wasn’t a very popular thing until we got into GLP-1s.”
Telehealth companies have been capitalizing on the rising costs of branded medications by marketing their own versions at much lower prices. In fact, two different startups have tried to sell vials of tirzepatide for less than $100—far less than what Mounjaro or Zepbound cost.
Annie Lambert, a senior policy adviser for healthcare, further clarified the role of compounding pharmacies to produce specialized medications to meet specific needs for individual patients. “There are some ways that compounders tailor a medication to the patient, such as by adding another ingredient that might help with a side effect or an additional concern or diagnosis,” she explained. Lambert cautioned that “there needs to be good science and evidence behind the safety of combining those things.”
Mochi Health defended its practices, stating that “their use remains appropriate and legal when tailored to individual patient needs and prescribed by a licensed medical provider—not as mass-market substitutes for branded medications.” Her statement reflects the intense political fight surrounding compounded medications and their safety, effectiveness, and regulation. With the booming market for GLP-1 drugs, this discussion is all the more urgent.
Eli Lilly has already begun taking legal action against these telehealth companies. Particularly given this fight may end the future availability of GLP-1 medications just as their popularity grows. The company’s aggressive response indicates the lengths it is willing to go to defend its monopoly. It exposes its concerns about the safety of other products on the market that consumers are using as substitutes.
Leave a Reply