Novo Nordisk and Eli Lilly win US court case over diabetes and weight-loss drug shortages

In a significant legal victory for pharmaceutical giants Novo Nordisk and Eli Lilly, a US appeals court has upheld the Food and Drug Administration's (FDA) decision to remove certain diabetes and weight-loss medications from the shortage list. The ruling affirms that the FDA adhered to proper procedures when determining that drugs like Ozempic, Wegovy, Mounjaro, and Zepbound were no longer considered scarce.

The case was brought forth by The Outsourcing Facilities Association (OFA), an organization representing compounders – companies that produce and sell generic versions of branded drugs. The OFA contended that despite the FDA's declaration, these medications remained in short supply, particularly in the US market where competition has intensified. Compounders have been selling versions of Novo Nordisk's Wegovy at lower prices, contributing to market dynamics.

During a period of high demand, shortages were reported for both Eli Lilly's Zepbound and Mounjaro, and Novo Nordisk's Ozempic and Wegovy. The OFA challenged the FDA's assessment, leading to judicial review. However, the appeals court found the FDA's final decision to be well-reasoned and not "arbitrary or capricious," according to reports citing MarketWire.

This court decision is crucial for Novo Nordisk and Eli Lilly, as it validates their position regarding drug availability and potentially limits the market for compounded versions of their popular medications. The ruling reinforces the FDA's authority in managing drug supply designations and addresses the ongoing competition and demand surrounding these widely used treatments for diabetes and obesity.

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FDA's final decision was neither arbitrary nor unreasonable.