GLP-1 Formulary Strategy
- Preferred drug selection: Select one preferred GLP-1 drug based on net cost and clinical evidence
- Non-preferred placement: Place non-preferred GLP-1 drugs on a higher cost-sharing tier
- Step therapy: Require trial of preferred GLP-1 before approving non-preferred
- Quantity limits: Limit GLP-1 prescriptions to FDA-approved doses
- Rebate negotiation: Negotiate rebates for preferred GLP-1 placement
- Exclusion: Consider excluding GLP-1 drugs for obesity (not diabetes) if cost is unsustainable
Rebate Negotiations
Rebate negotiations for GLP-1 drugs can reduce net costs by 20–40%. Manufacturers of GLP-1 drugs offer rebates for preferred formulary placement — similar to other specialty drugs. A transparent PBM contract that passes 100% of GLP-1 rebates to the employer is essential for capturing these savings.
Obesity vs. Diabetes Coverage
IQ Insight
Many employers cover GLP-1 drugs for diabetes (Ozempic, Mounjaro) but not for obesity (Wegovy, Zepbound). This distinction is clinically arbitrary — the same drug (semaglutide) is approved for both indications. However, the cost impact of covering GLP-1 drugs for obesity is far greater than for diabetes — because obesity prevalence is much higher. Employers who cover GLP-1 for obesity must implement strong clinical criteria to manage costs.