It’s an interesting time for the GLP-1 market. Now that Wegovy and Zepbound have been available for weight loss for a few years, early reports are being published on the outcomes of these drugs for both patients and their employers.
While GLP-1s are effective at promoting weight loss, there is still uncertainty around whether the long-term health benefits will be actualized by warding off high-cost acute events such as heart attack, stroke and complex diabetes management to name a few. Adding to that uncertainty is evidence of high discontinuation rates due to cost and adverse events. On top of that, the return on investment for employers will likely not be seen for a few more years. For organizations wondering what to do next, here’s a look at where the market is today and how to find an approach that works for your employee population.
The GLP-1 market is continuously evolving, and it’s becoming increasingly complex – making it hard for employers to make coverage decisions. In a survey from the International Foundation of Employee Benefit Plans, more than half (53%) of employers who cover GLP-1s for diabetes reported that they are not considering covering them for weight loss at this time. The survey also found that GLP-1s for weight loss accounted for an average 10.5% of total annual claims in 2025 compared to 8.9% in 2024. As many employers wait for prices to drop, there are a couple of market changes that need to take place first.
Manufacturers of GLP-1s are actively pursuing FDA approval for new indications of the drugs, many of which are linked to obesity. In 2024, the Food and Drug Administration approved Novo Nordisk’s Wegovy (semaglutide) to reduce cardiovascular risk in overweight or obese individuals, and approved Eli Lilly’s Zepbound (tirzepatide) to treat moderate to severe obstructive sleep apnea in adults with obesity.
Several manufacturers including Boehringer Ingelheim, Hanmi Pharmaceuticals and Kariya Pharmaceuticals are researching and trialing the benefits of GLP-1s for conditions with less clear links to obesity, like metabolic dysfunction-associated steatohepatitis (MASH), Alzheimer’s disease, Parkinson’s disease, obesity-associated cancers and substance use disorder. As GLP-1s are studied and approved for more indications, that should put some downward pressure on the market.
Prices for GLP-1s have started to decrease, but not enough for most employers to consider covering them for weight loss. It’s likely going to take the introduction of generics to the market for there to be a meaningful decrease in price. While generics for older forms of GLP-1s like Victoza (liraglutide) have been approved for diabetes, generics for weight loss indications are not yet available. And generics for newer GLP-1s won’t hit the market any time soon. Novo Nordisk’s patent on semaglutide and Eli Lilly’s patent on tirzepatide don’t expire in the U.S. until 2032 and 2036, respectively.
Regulatory pressure to lower drug costs should have an impact on GLP-1s, but actualizing those reductions will take time. Right now, price cuts are focused on direct-to-consumer rather than health plans – with Novo Nordisk and Eli Lilly cutting prices for patients paying out-of-pocket.
It’s likely not the answer most employers want to hear, but the return on investment for covering GLP-1s for weight loss is not going to be realized in the short term. Employers should go in with the mindset that these drugs are a long-term investment in employee health and will not produce savings based on an annual budget.
In the near-term, employers might see gains in terms of increased productivity from employees using GLP-1s for weight loss, as obesity has been linked to higher absenteeism and productivity loss. But those returns are hard to measure.
Another key variable of ROI employers need to consider is what happens after employees reach a healthy weight and are weaned off GLP-1s? Research indicates that GLP-1s are most effective when combined with lifestyle and behavioral changes. For the best outcomes and maximum ROI, employees will need to have access to resources, like nutritionists and obesity medicine specialists, before, during and after GLP-1 treatment. Otherwise, as studies have shown, some members who stop taking the medication may gain back some or all of the weight they lost, putting them at higher risk for high-cost events.
Right now, there’s no one-size-fits-all approach for employers to follow when it comes to covering GLP-1s for weight loss. Part of the challenge is the lack of a cost-effective approach for discontinuing the use of GLP-1s for both diabetes management and weight loss, so it’s hard for employers to predict how long employees might be using these high-cost drugs. And if they do stop, they’ll likely need programs to help them keep the weight off and maintain a healthy lifestyle.
What employers can do today regarding GLP-1s for weight loss is take a closer look at their employee populations. Those with access to data warehouses can leverage clinical data annually to estimate how many employees might qualify for GLP-1s for weight loss (i.e. obesity diagnosis with no diabetes). This data can help employers determine the risk and potential reward of offering GLP-1s for weight loss in their employee benefits package.
The best advice for most employers is to continue to practice patience. Employers currently covering or contemplating adding coverage for GLP-1s for weight loss should consider utilization management strategies that might help contain costs, such as tightening controls on coverage eligibility or durations and mandatory nutrition and lifestyle coaching.
Employers that have chosen to sit it out for now should consider what, if any, alternative weight loss programs they may want to offer.
No matter where your organization stands with GLP-1s, working with an experienced employee benefits consulting partner who understands and is following the evolving landscape is key. There’s no perfect answer or single approach that’s right for every employee population. A good partner will work with you to determine an employee benefits program that will work for your company. At Conner Strong & Buckelew, our Consultants, Population Health and Pharmacy practice groups are working on the frontlines of GLP-1 adoption. We can help your company stay up to date in the rapidly evolving landscape and work with you to build custom solutions for your employee population. Contact us now to learn more.
Jill Ambrose, MBA, BSN, RN
Partner, Head of Population Health
Simon Leung, PharmD
Vice President, Head of Pharmacy
