Diabetes and weight loss drug manufacturers eli lilly and co (LLY.US) and novo-nordisk a/s (NVO.US) saw their stock prices rise by 5% and 2% respectively on Tuesday, as the US government introduced a new regulation allowing medical insurance and Medicaid to cover the cost of weight loss treatment for obese patients.

The government stated that millions of obese Americans will be eligible to receive coverage for weight loss medications such as Wegovy or Ozempic through medical insurance or Medicaid, with future fiscal expenditures amounting to up to 35 billion US dollars over the next decade.