Pending the FDA’s decision, compounding pharmacies will remain free to make and market versions of the blockbuster weight-loss therapy.
Eli Lilly’s weight-loss therapy tirzepatide remains in limbo as the FDA continues to assess its supply status and whether or not a shortage should be declared, according to a court status report on Thursday.
The regulator has “made substantial progress” in reassessing its prior decision to take tirzepatide off its drug shortage list and “continues to prioritize issuing a new decision” on the matter, the report said. The next court status report is due on December 19, 2024, or within seven days of the FDA’s decision—whichever comes earlier.
Today’s update signals that “the FDA has agreed to not take action against compounders of tirzepatide until December 19, unless the agency makes an earlier decision on remand,” according to an investor note from Leerink Partners analyst Michael Chern., He noted that this could have some positive implications for the business of several compounders.
Early last month, the FDA officially declared that the shortage of tirzepatide—sold as Mounjaro for type 2 diabetes and as Zepbound for chronic weight management—had been resolved. Lilly’s drug had previously spent months on the regulator’s shortage list as the pharma struggled to match its manufacturing capacity with the market’s insatiable demand for obesity medications.
With this move, however, the FDA effectively barred compounding pharmacies from producing their ownversions of tirzepatide—something that trade group Outsourcing Facilities Association (OFA) did not take kindly to. Weeks after the end of the shortage, the OFA blasted the FDA’s decision, calling it “arbitrary” and saying it could “deprive patients of a vital treatment for type 2 diabetes and obesity.”
The OFA sued the FDA, alleging that the move to take tirzepatide off shortage lacked “any semblance of lawful process.” The complaint noted that Congress allows certain drugs to be compounded when supply is limited, with the goal of helping the industry continue to deliver therapies to patients who need them.
“Patient demand has been satisfied in precisely the manner Congress contemplated,” the OFA wrote in its lawsuit.
In Thursday’s court update, the OFA said that it has consistently tracked the market conditions for tirzepatide in order to support the FDA’s decision-making and to provide the agency with “evidence that the drug remains in shortage.”
“Survey data from this month shows increasing numbers of patients unable to obtain branded GLP-1 agonist products, including specifically branded Tirzepatide products,” the OFA noted, adding that pharmacies and other distributors “continue to list branded Tirzepatide products as out-of-stock or available in only limited quantities.”
For its part, Lilly has taken a strong stance against compounded versions of tirzepatide. Last month, the pharma sued three retailers for allegedly marketing remixed tirzepatide. Lilly filed similar lawsuits in September 2023 and October 2023, continuing the legal offensive into June 2024.
BMO Capital Markets analyst Evan Seigerman said in a Thursday note that the court update “provides little clarity on the path forward for Lilly’s ongoing battle with compounders.” Still, the firm believes that despite “uncertainty” regarding the lawsuit and tirzepatide’s shortage status, Lilly continues to have strong prospects moving forward.
“With capacity continuing to expand, we anticipate that compounder headwinds will be eliminated in the medium term even if the FDA’s decision on drug shortage is reversed in the near term,” Seigerman said.
