FDA says the Zepbound shortage is over. Here’s what that means for compounding pharmacies, patients who used off-brand versions

The roughly $1,000 monthly price tag of Eli Lilly‘s weight loss drug Zepbound put the blockbuster treatment out of reach for Willow Baillies, 29, whose insurance does not cover it.

Baillies, a human resources specialist based in Milwaukee, Wisconsin, has been attempting to lose weight and dealing with chronic autoimmune issues for years, so she turned to a cheaper alternative: a compounded, off-brand version of tirzepatide.

Tirzepatide is the active ingredient in Zepbound and in Eli Lilly’s diabetes counterpart Mounjaro, which are part of a class of highly popular medications called GLP-1s. 

She said compounded tirzepatide has helped change her life dramatically since she began taking it in June, alleviating pain from her autoimmune issues and helping her lose about 52 pounds. She said it costs her around $350 per month.

But soon, compounded versions of tirzepatide could become inaccessible to Baillies and other patients who rely on them. Patients and health-care experts said that could force some consumers to stockpile doses, switch to other treatments, or stop receiving care altogether due to financial constraints. Others could turn to a potentially unsafe method of mixing vials themselves. 

That’s because the Food and Drug Administration on Thursday announced that branded tirzepatide is no longer in short supply — a decision that will largely prevent compounding pharmacies from making and selling cheaper versions of the drug in the next two to three months. 

During FDA-declared shortages, pharmacists can legally make compounded versions of brand-name medications. But drugmakers and some health experts have pushed back against the practice because the FDA does not approve compounded drugs, which are essentially custom-made copies prescribed by a doctor to meet a specific patient’s needs. 

The FDA’s decision, based on the agency’s comprehensive analysis of data, could mean that more patients with insurance coverage will be able to access Zepbound after months of limited supply. It also suggests that Eli Lilly’s multibillion-dollar effort to ramp up manufacturing for tirzepatide is starting to pay off. 

But it will also leave other patients in limbo, closing a niche, lucrative market for compounded tirzepatide that patients say helped fill a gap in care for those who can’t afford to pay out of pocket for Zepbound.

Many insurance plans still don’t cover drugs for weight loss, and some patients said prices under Eli Lilly’s savings program and for its half-priced vial versions are still too high.

“I’ve stockpiled 10 compounded vials at home, so I have at least a year’s worth,” said Baillies, one of six patients CNBC spoke with about compounded tirzepatide. “We’re willing to kind of do anything to have this. It’s not just about looks; it’s about the opportunity it gives us to live our lives to the fullest.” 

Many patients and major trade groups question whether the shortage is truly resolved amid reports of people still struggling to find Eli Lilly’s drugs. 

Some medical professionals raised concerns about whether Eli Lilly can meet demand once more patients come off compounded tirzepatide and others start Zepbound for its newly approved use: obstructive sleep apnea. 

It’s unclear how many people are on compounded tirzepatide, but one trade group estimated in November that there are more than 200,000 prescriptions for compounded versions of its main rival — Novo Nordisk‘s weight-loss drug Wegovy — being filled each month. 

“In this current moment, I have confidence that the shortage is over,” said Dr. Shauna Levy, an obesity medicine specialist and medical director of the Tulane Bariatric Center in New Orleans. “Do I think the shortage is over forever? Probably not.” 

Eli Lilly did not immediately respond to a request for comment.

The FDA initially declared the tirzepatide shortage over in October. 

But a trade group called the Outsourcing Facilities Association sued days later, claiming the agency made its determination without proper notice and failed to account for continued supply disruptions. That lawsuit pushed the FDA to reconsider and allowed pharmacists to make compounded versions in the meantime. 

In its decision announced Thursday, the FDA concluded based on data from Eli Lilly, patients, providers, compounders, and other sources that “Lilly’s supply is currently meeting or exceeding demand and that, based on our best judgment, it will meet or exceed projected demand.”

The FDA is giving so-called 503A compounding pharmacies until Feb. 18 before it takes enforcement action that would put a halt to their work. The 503A pharmacies make compounded drugs according to individual prescriptions for a specific patient and are largely regulated by states rather than the FDA. 

Meanwhile, pharmacies manufacturing compounded drugs in bulk with or without prescriptions — known as 503B outsourcing facilities — get an additional month, with a deadline of March 19. They are regulated by FDA guidelines. 

Those “off-ramp periods are appreciated” because it gives patients time to switch to brand-name tirzepatide, said Tenille Davis, chief advocacy officer for trade group Alliance for Pharmacy Compounding.

But the group’s members are still reporting that “there’s a real lack of availability” of tirzepatide, she said. That trade group represents compounding pharmacies and hybrid pharmacies that also dispense regular drug prescriptions.

Still, 503A pharmacies may be allowed to continue making compounded tirzepatide in certain situations under the law, Davis said. 

That includes when a prescriber determines that a compounded version with certain changes will produce a “significant difference” for a patient. For example, a patient may need a specialized dose or be allergic to the dye in a branded product. 

Davis said that means compounded tirzepatide won’t be completely eliminated in the U.S., but the scale of it will “certainly decrease.”

The legal battle between the FDA and the Outsourcing Facilities Association isn’t over yet, however. On Thursday, the FDA and OFA jointly said they will provide an update in court by Jan. 2 to address the “next steps in this litigation.” They also said if the trade group files a preliminary injunction over the next two weeks, the FDA will not take action against its members for continuing to make compounded tirzepatide until the court resolves the case.

That pending litigation further “adds to the confusion of the status of compounded tirzepatide after February and March,” said Dae Lee, a partner at law firm Frier Levitt who represents pharmacies, none of which were involved in the dispute with the FDA.

Many patients who rely on compounded tirzepatide are scrambling to ensure they can continue care. 

That includes Amanda Bonello, 36, an Iowa-based account manager who said she is prediabetic. Bonello said taking compounded tirzepatide over the last two months has helped her lose 26 pounds and normalized her blood sugar levels, allowing her to avoid a diabetes diagnosis. 

She said she “absolutely cannot” afford branded tirzepatide since her insurance does not cover it, so she will consider switching to compounded semaglutide. That is the active ingredient in Wegovy and its diabetes counterpart Ozempic, Novo Nordisk’s two GLP-1s that are still on the FDA’s drug shortage list. 

Many compounding pharmacies make unbranded versions of semaglutide, which has been on the U.S. market — and in short supply — for much longer than tirzepatide. But an end to the shortage may be imminent, with the FDA announcing in late October that all doses of semaglutide are available. 

“If compounded semaglutide goes away as well, then I will be screwed,” Bonello said. She has launched an online petition demanding that the FDA support access to compounded GLP-1s. The petition has gained more than 15,000 signatures in the past month.

Another patient, Erin Hunt, 31, a communications analyst based in Maryland, said she may eventually switch to the branded version of tirzepatide. 

Hunt started taking compounded tirzepatide in April after struggling to find supply of Zepbound, which she took for one month. It has helped her lose around 55 pounds, experience fewer symptoms from her chronic inflammatory conditions and pursue a healthier diet and exercise. She said she initially paid $300 per month for the compound drug and now pays $350 for a higher dose.

Hunt’s insurance does not cover Zepbound. But she qualifies for Eli Lilly’s savings card program, which allows commercially insured patients without coverage for Zepbound to buy a month’s supply for around $650. Under that program, patients whose commercial insurance plan covers Zepbound can pay as low as $25. 

“I am extremely concerned for what it’s going to cost,” Hunt said. “This medication has literally changed my life, and it’s probably going to benefit me to be on a maintenance dose for life.”

For Jill Skala, 49, a teacher in western Pennsylvania, the FDA’s decision means that she will lose a more affordable option after her insurance drops Zepbound coverage on Jan. 1. 

Her copay for Zepbound has been around $10 per month since she started the drug in March. Skala said she has lost 52 pounds and noticed “profound improvements” in her mental health, sleep and energy levels. She has stockpiled a three-month supply of Zepbound, she said, and will “do the best I can to maintain my weight loss” once that runs out.

“I don’t see myself continuing to get the branded version at this point unless there’s a pathway back through insurance or Eli Lilly drops the price,” Skala said. “I just paid off my student loans. I don’t want to start my medical debt problem here.”

Other patients may turn to an underground community Reddit users call “the gray market”: People directly purchase powdered tirzepatide or semaglutide peptides for as little as $50 per month from certain vendors, including Chinese manufacturers, and mix that with sterile water at home, creating a solution they can inject under their skin. 

Reddit users say the community establishes protocols for third-party lab testing of peptides to verify their purity and promotes safe mixing and dosing practices. 

But Tulane’s Levy said the method “seems very dangerous,” noting that mixing homemade medications without proper training “could potentially have real consequences.” 

She said it “highlights people’s desperation to treat the disease of obesity, which is being inadequately met by our current insurance status” for drugs such as Zepbound. 

Some compounding pharmacies such as Strive Pharmacy are operating as usual pending more updates to the legal fight. Strive operates nine 503A pharmacies across the U.S., which offer compounded GLP-1s and other services. 

But Strive will largely stop making compounded tirzepatide by the February deadline if nothing further happens, according to Matthew Montes de Oca, the company’s chief clinical officer. He acknowledged that Strive could create compounded versions of the drug for specific prescriptions, such as adding glycine to help prevent muscle deterioration in a patient. 

Compounded tirzepatide with glycine is what Gina Wright’s doctor will prescribe for her so she can continue taking the unbranded version, which she gets from a different pharmacy. Wright, 58, a self-employed business consultant in Colorado who is prediabetic, said she is paying $225 for a five-milligram dose, which she began taking earlier this month. 

She is on her state Medicaid plan, which does not cover Zepbound, so she does not qualify for Eli Lilly’s savings card program. But Wright said she also has sleep apnea, so she is trying to get insurance to cover Zepbound for that purpose.

De Oca said compounding individual prescriptions for specific patients will make it harder for Strive to ensure that all of its safety procedures are still in place. Strive typically tests its tirzepatide and semaglutide with a third-party analytical company and conducts a months-long “stability study” to guarantee the quality and safety of the product before creating batches of up to 250 vials, he noted. 

Dr. Mace Scott, the owner and medical director of Chronos Body Health Wellness, said the fate of compounded tirzepatide at his Louisiana-based medical spa will depend on the pharmacies he sources it from and “how they decide to move forward.” His spa relies on both 503A and 503B pharmacies, he said, so some patients may be able to continue compounded tirzepatide with a specialized prescription. 

Scott said he is trying to help some patients get insurance approval for branded tirzepatide. He is recommending that others switch to compounded semaglutide, which is what roughly 75% of Chronos patients are taking, he said. The spa has treated more than 10,000 patients with branded or compounded GLP-1 medications, according to its website.

“It’s kind of a tough road to traverse right now, so we’re trying to figure out what’s best on a patient-by-patient basis,” Scott told CNBC. 

The American Diabetes Association, a nonprofit organization that promotes diabetes research and advocacy, told CNBC it recommends against the use of compounded GLP-1s due to “ongoing concerns” about their safety, quality and efficacy.

It is difficult to discern the quality of the product and its distributor, which poses a potential risk to patients, Joshua Neumiller, the association’s president-elect for health care and education, said in a statement.

Neumiller also pointed to an FDA alert in July about cases of patients measuring and administering incorrect doses of compounded GLP-1s, some of which resulted in adverse events that required hospitalization. 

But Molly B., an interior designer based in New York who asked CNBC to omit her full last name, said compounded GLP-1s are her only option.

She said her insurance denied coverage for brand-name semaglutide twice before she started taking compounded tirzepatide in September. It has helped her lose 23 pounds, she said, and eliminated constant thoughts about food — a game changer for a patient suffering from polycystic ovary syndrome, a hormonal disorder that makes it difficult to lose weight. 

“I have never been able to lose this much weight on my own, and I’ve tried 100 times,” she said. “This has really changed my life, so I would hope that I can continue to get it the way I am now.”