(Reuters) -Eli Lilly is dropping CVS Health’s drug benefit plan for its employees after CVS stopped covering its weight-loss drug in favor of a rival medication from Novo Nordisk, Bloomberg News reported on Tuesday, citing people familiar with the matter.
Beginning on January 1, Lilly employees covered by the company’s medical plan will be automatically enrolled with pharmacy benefit coverage through pharmacy benefit manager Rightway, according to a document viewed by Bloomberg.
CVS in May said its Caremark pharmacy benefit management unit had decided to drop Lilly’s weight-loss drug Zepbound as a preferred product from its reimbursement list from July 1 and that it will retain rival Wegovy after negotiating more favorable pricing for Novo Nordisk’s medicine, adding that will make the drug more affordable for patients.
CVS spokesperson David Whitrap told Reuters that while the company won’t comment on specific clients, Caremark’s overall client retention remains in the high 90% range year after year, adding that it offers options that covers both Zepbound and Wegovy, but “this option is costlier for plan sponsors than our standard commercial formulary that excludes Zepbound.”
“Our move earlier this year to negotiate Lilly and Novo against one another drove significant savings for our clients,” Whitrap added.
Eli Lilly and Rightway did not immediately respond to Reuters’ requests for comment. Reuters could not immediately verify the Bloomberg report.
Novo faces increasing competition from Lilly’s Zepbound and compounded copycat drugs in the weight-loss drug market.
Wegovy and Zepbound are the only highly effective GLP-1 weight-loss drugs sold mainly in the U.S. as weekly injections.
(Reporting by Rishabh Jaiswal and Dheeraj Kumar in Bengaluru; Editing by Sonia Cheema)
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