Eli Lilly CEO David Ricks talks Medicare coverage of obesity pills

Eli Lilly Upcoming Medicare coverage of obesity drugs could be a key catalyst for the company’s launch of its closely watched experimental weight-loss pill, or forglipron, CEO Dave Ricks said Friday.

In an exclusive interview with CNBC, Ricks said that Lilly “expects Medicare to cover the treatment right after this launch, which will change the game a little bit.”

He said this was because many patients now pay cash to rival companies. Novo NordiskGLP-1 pill against obesity. This campaign, launched earlier this month, is off to a strong start despite inadequate insurance coverage.

Ricks noted that nearly all early adopters of Novo’s Wegovy pill were new to GLP-1 treatments rather than users of existing injections, so “it’s comprehensive, it’s reaching more patients, and that’s great.”

He added that Lilly is confident in the pill’s ability to compete and is preparing for a “full launch” in the second quarter. The rollout is set to coincide with Medicare starting to cover obesity drugs for the first time later this year under drug pricing agreements Lilly and Novo struck with President Donald Trump in November.

This government coverage will further reduce the price of pills in the second half of the year, Ricks said. Some Medicare patients will pay a co-pay of $50 per month for all approved uses of injectable and oral GLP-1 drugs, including treating diabetes and obesity.

“This is expanding things quite a bit and we’ll see where we can go from there,” Ricks said.

Medicare coverage of obesity treatments is a long-awaited move that some health experts say could expand the drug market and encourage more private insurers to cover them. Ricks estimates that 20 million to 30 million Medicare beneficiaries with obesity and related health problems may be eligible for GLP-1 treatments, so coverage is a “huge multiplier in the eligible pool.”

Ricks acknowledged there would be a “reduction in prices” earlier this year under the drug pricing agreement. The agreements involve drugmakers voluntarily making their drugs cheaper, selling their existing treatments to Medicaid patients at rock-bottom prices abroad, and guaranteeing so-called most-favored-nation pricing for new drugs.

But volume growth for Lilly’s drugs “will pick up in the back half of the year,” Ricks said.

“We think it’s a positive balance for us, but time will tell,” he said, adding that it would depend on the uptake of the treatments among Medicare patients and the company’s share of that adoption.

Lilly said it would share more details about the financial impact of the deal when it reports fourth-quarter earnings and 2026 forecasts next week.

The price agreements include commitments to launch the drugs at discounted cash-back prices on Trump’s direct-to-consumer platform, TrumpRx. The site, which is expected to be operational in January, is not yet live.

Lilly was the first drugmaker to sell obesity treatments directly to patients through the company’s platform, LillyDirect, and TrumpRx is “taking that and expanding it to other drugs across the industry,” Ricks said.

“This is what we’re all for,” he said.