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- Eli Lilly's Zepbound, an obesity drug, now has Medicare coverage for sleep apnea.
- The drug's approval for sleep apnea allows Medicare coverage, despite its high cost.
- Analysts predict the GLP-1 drug market could reach $150 billion annually by 2030s.
WASHINGTON — Eli Lilly's obesity drug Zepbound can now be covered by government-backed Medicare insurance plans for use in sleep apnea, broadening access to the blockbuster weight-loss treatment.
The Wednesday statement from the Centers for Medicare and Medicaid Services comes after Zepbound in December became the first drug approved in the U.S. for sleep apnea, strengthening its case for coverage as Medicare cannot cover obesity drugs unless they are approved for a secondary use by the Food and Drug Administration.
Commercial insurers and employers were previously hesitant to cover the drug due to its high cost of over $1,000 a month.
Insurers can still choose not to cover Zepbound despite the Centers for Medicare and Medicaid Services's guidance.
Last year, rival Novo Nordisk's obesity drug Wegovy also gained Medicare coverage to reduce the risk of heart attacks and strokes.
Lilly and Novo are testing their blockbuster obesity drugs for a range of conditions as they race to demonstrate that the treatments have other health benefits.
The Biden administration proposed to expand the coverage of drugs to treat obesity in November last year. If President-elect Donald Trump's incoming administration backs the move, it would be effective from 2026.
About 65 million people are enrolled in Medicare plans, intended for people aged 65 and older or those who are disabled.
Sleep apnea, which affects around one billion people globally, causes patients to stop breathing briefly while sleeping, disturbing the sleep cycle and causing long-term complications such as heart conditions.
Common treatments recommended for the condition include continuous positive airway pressure machines, surgery, as well as losing weight.
Zepbound and Lilly's other blockbuster diabetes drug, Mounjaro, belong to a class of drugs called GLP-1 agonists.
Analysts have forecast the market for GLP-1 drugs could reach at least $150 billion a year by the early 2030s.
