On Tuesday local time, US President Biden and Senator Bernie Sanders stated in a comment article published in USA Today that Novo Nordisk and Eli Lilly must reduce the prices for drugs treating diabetes and obesity. In early US trading, the stock price of novo-nordisk a/s fell nearly 4%, and the stock price of Eli Lilly fell nearly 3%, then closed at a drop of nearly 1.68% and 0.84%, respectively.$Novo-Nordisk A/S (NVO.US)$The stock price fell nearly 4%.$Eli Lilly and Co (LLY.US)$The stock price fell nearly 3%, and then closed at a drop of nearly 1.68% and 0.84%, respectively.

Biden pointed out that the prices of Novo Nordisk and Eli Lilly drugs are "unreasonably high" and far higher than in other countries, which is unacceptable. If these pharmaceutical companies refuse to significantly lower prescription drug prices in the United States and end their greed, we will do "everything we can" to help stop this behavior.

They claimed that if the prices of these drugs are not substantially reduced, they could also bankrupt the entire US healthcare system, so Novo Nordisk and Eli Lilly must lower their prices.

They also wrote that Novo Nordisk's profits exceeded US$12 billion in 2023, partly because it charged each American a monthly prescription drug cost of US$1,000, while the production cost of the drug was less than US$5 per month. This is not a reasonable return on investment, but price gouging and corporate greed.

Expensive prescription drugs in the United States have always been closely watched by lawmakers from both parties. Biden has made reducing healthcare costs a key part of his 2024 re-election campaign, and as chairman of the US Senate Health Committee, Sanders has taken a series of actions.

Analysts say that the market for weight loss drugs is growing explosively, and by the end of this decade, the market size may exceed $130 billion annually. Pfizer, AstraZeneca, Amgen, and many small biotechnology companies are all competing to launch these products to consumers.

Jared Holz, an analyst at Mizuho Bank, said in a report that Biden's remarks seem to be the "final effort to appease certain voters." He added that considering the benefits of these drugs in treating diabetes, heart disease, and other diseases, "the cost of $1,000 per month actually looks very cheap."

However, the American people do not agree with Holz's view. $1,000 per month in expenses is indeed too expensive without insurance. About 54% of people taking weight loss medications find it difficult to afford even with insurance.

In fact, Sanders had previously put pressure on Novo Nordisk, strongly demanding that it lower the prices of its weight loss drug Wegovy and diabetes drug Ozempic, and raised a series of questions about costs and manufacturing for this pharmaceutical company.

It is reported that in the US market, the single box price of Ozempic, a drug for diabetes treatment, is close to $936, and the single box price of Wegovy, a weight loss drug, is $1,349. The monthly cost of Mounjaro from Eli Lilly is about $1,100.

Novo Nordisk responded to Sanders' request that the high prices of Ozempic and Wegovy in the United States are a systematic problem and it is prepared to work with lawmakers to solve these problems.

Novo Nordisk said it expects more discounts for these two drugs, especially as more insurance companies are willing to provide insurance for Wegovy.

Driven by the craze for weight loss drugs, Lilly and Novo Nordisk are rushing towards a market value of 1 trillion US dollars, which was unimaginable for pharmaceutical companies a few years ago. In addition to AI trades boosting technology stocks such as Nvidia, weight loss drugs may be the most noteworthy theme in the stock market this year.

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