GLP-1 manufacturers embrace models bypassing PBMs to boost employer coverage

When the Trump administration announced that it struck a deal with two major GLP-1 manufacturers last month, it was unclear how soon discounts on the weight loss drugs would extend to workers on employer-sponsored insurance.

The White House is working with Eli Lilly and Novo Nordisk to offer cheaper GLP-1s to patients enrolled in Medicare and Medicaid, as well as those who want to purchase the medications without insurance. But employers are keen to understand how soon such discounts may extend to their own medical plans, especially if they aren’t already covering the popular drugs.

“Once you have publicity around a Medicare price, I think the demand for a price that is close to that level is going to be really high,” Caroline Pearson, executive director of the Peterson Health Technology Institute, said. The White House said patients will be able to purchase GLP-1s on the direct-to-consumer market for around $350, while Medicare beneficiaries will be able to access them with a $50 co-pay. Historically, these medications have cost upwards of $1,000 a month.

As demand for the drugs remains high, Eli Lilly and Novo Nordisk recently embraced new models that seek to bypass pharmacy benefit managers and make GLP-1 coverage more financially feasible for employers.

“Direct-to-employer” models. Just 19% of employers with 200 or more workers are currently covering GLP-1s for weight loss, Pearson noted, citing KFF’s 2025 employer benefits health survey. Those that do cover them typically do so through their medical benefit, offering GLP-1s through a rebate negotiated by their pharmacy benefit manager (PBM), she said.

Understanding how medications are priced through a PBM can be complicated, as plan sponsors don’t have a complete picture of how these middlemen work with drugmakers and insurers, HR Brew has previously reported.

“That PBM black hole is still there when you’re…doing it through the employee benefit,” said Alysha Fluno, national pharmacy practice leader with the consulting firm Mercer, when asked about the drawbacks of this model for GLP-1 coverage.

Lilly and Novo Nordisk—which manufacture Zepbound and Wegovy, respectively—recently said they’ll allow employers to bypass PBMs and purchase the drugs from them directly starting on Jan. 1. This so-called direct-to-employer model will be offered through a partnership with Waltz Health, which helps employers access lower-cost drugs. Participating employers will be able to purchase GLP-1s at a fixed price, forgoing the rebates and fees that companies often incur when working to offer medications through PBMs.

“Obesity management medicines are driving a major shift in care expectations, and employers are actively searching for solutions that make coverage both clinically responsible and financially viable,” Mark Thierer, co-founder and CEO of Waltz Health, said in a statement about the model.

Will transparent pricing = cheaper drugs? New offerings like this direct-to-employer model are unlikely to change behavior among employers that are already covering GLP-1 medications through their medical plan, said Fluno.

“The employers that are paying for these medications through the plan, they’ve already budgeted for them,” she said, noting that companies would have typically already made a decision about covering GLP-1s for weight loss in 2026, and communicated their decision to workers during open enrollment. Those that aren’t already covering the medications might consider a solution like the direct-to-employer offering, but they’ll have to consider whether the added costs fit into their budget, she added.

It’s unclear how much employers will pay for GLP-1s through the direct-to-employer compared to a traditional medical plan. Thierer told Bloomberg that Waltz Health’s model would “be the absolute cheapest way” for patients on employer-sponsored healthcare to get the drugs, but declined to share negotiated prices.

Ilya Yuffa, Lilly USA’s EVP and president, told HR Brew via email that the model “is designed to provide clarity on medicine costs and flexibility for employers to determine the right benefit design for their companies and employees,” and said more details will be available in 2026.

Regardless of how employers choose to cover GLP-1s, they may soon see prices lower due to shifts in the market, Fluno said. Availability of lower-cost GLP-1 options, such as generics and oral medications, as well as the Trump administration’s efforts to fast-track “next-generation GLP-1 medications,” could mean “the ability to negotiate down on price will be more in the favor of the PBM” going forward.

These shifts also mean HR leaders won’t be able to ignore demand for the medications among their workforce, Pearson suggested. Even though direct-to-consumer prices are going down, these costs still represent “a big bill for most people in the country,” Pearson said. “I think people still are really hoping that their health insurance is going to cover a portion of that.”