CVS Health last Thursday announced that its pharmacy benefit manager division will drop Eli Lilly’s Zepbound from its preferred formulary list starting July 1, 2025. Instead, CVS will prioritize coverage of Wegovy, a competing GLP-1 medication produced by Novo Nordisk.

The move is another skirmish in a broader set of battles being fought on multiple fronts: between competing pharmaceutical companies, between the pharma industry and pharmacy benefit managers, between pharma and direct-to-consumer telehealth companies. The landscape of battles reveals the complex web of incentives in the U.S. pharmaceutical supply chain, and where those incentives leave patients.

Zepbound, approved in late 2023 for chronic weight management, is structurally similar to Lilly’s diabetes drug Mounjaro but marketed separately for weight loss. Like Wegovy, Zepbound has demonstrated impressive results in helping patients lose significant weight and improve metabolic health. But these drugs come at a high cost: list prices typically exceed $1,000 per month, and payers are increasingly scrutinizing how and whether to cover them.

Despite the cost, demand for GLP-1s has been skyrocketing over the past several years. And Lilly’s Zepbound has been taking share from competitor Novo Nordisk, recently passing Novo Nordisk’s share of obesity and diabetes GLP-1 prescriptions. “Zepbound is the U.S. branded anti-obesity market leader in both total prescription[s]

and new prescription[s],” said Lilly EVP and CFO Lucas E. Montarce in its recent Q1 earnings

call

.

CVS’s decision to exclude Zepbound from its standard national formulary is likely driven by a combination of price negotiations, formulary rebates, and strategic contracting. PBMs like CVS Caremark (the brand name of CVS’ PBM) typically negotiate discounts and rebates with drug manufacturers in exchange for preferred placement on formularies. When two or more similar products are available—such as Zepbound and Wegovy—PBMs can play them off each other in order to secure more favorable terms.

Pharmacy benefit managers wield enormous influence over what medications are available and affordable for patients. As middlemen between insurers, drugmakers, and pharmacies, PBMs manage formularies, negotiate prices, and process pharmacy claims. The three largest PBMs—CVS Caremark, Express Scripts (Cigna), and OptumRx (UnitedHealth)—collectively control about 80% of the market.

While PBMs were originally intended to reduce costs for patients and payers, their role has come under increasing scrutiny. Critics argue that PBMs are incentivized to prefer drugs with higher list prices and rebates, even if those drugs aren't necessarily the most effective or accessible. In the case of GLP-1 drugs, this creates a high-stakes competition where formulary access may not go to the drug with the best outcomes, but rather to the one offering the most attractive deal to the PBM.

CVS Caremark manages pharmacy benefits for 90 million Americans, although not every member will necessarily be impacted by the company’s move. Many members are part of self-insured plans that may direct Caremark to include Zepbound. Eli Lilly has been working hard to influence employers, and in October reported that it had achieved broad formulary coverage for Zepbound representing access to 87% of the commercial segment.

Regardless, for many of its members, CVS’s move could mean losing access to Zepbound through their insurance, or facing much higher out-of-pocket costs.

While some members may be able to transition to Wegovy, not all will respond the same way to different GLP-1 medications; a change in therapy can introduce uncertainty, both in terms of efficacy and tolerability.

Patients who have found success with Zepbound may now face disruption in their care. For clinicians, the shift may introduce new administrative burdens as they and their staff navigate prior authorizations and appeals on behalf of their patients.

CVS Caremark’s decision may be an attempt to slow Eli Lilly’s growth and influence. Lilly already has an oral GLP-1 drug in the pipeline, and another type that is demonstrating even better weight loss results than it has with Zepbound.

Eli Lilly has been working proactively to address patient access to Zepbound in the meantime. In addition to offering copay assistance and patient support programs, Lilly has launched a direct-to-consumer pharmacy called LillyDirect, which allows patients to obtain Zepbound and other Lilly medications directly. Lilly has also partnered with telehealth platforms like Ro and Hims & Hers to facilitate access to Zepbound for weight loss.

These partnerships bypass traditional PBM gatekeepers, offering a parallel channel that combines telehealth prescribing, cash-pay pricing, and direct distribution. The cash-pay price of Zepbound through LillyDirect ranges from $349/month to $499/month - substantially lower than the list price, but still out of reach for many. Nevertheless, the move reflects a broader trend: pharmaceutical manufacturers are increasingly willing to go around PBMs to reach patients more directly, especially in the high-demand GLP-1 category.

CVS Caremark’s decision may preview a new phase in the battleground over GLP-1 access. As more employers and health plans grow concerned about the cost of covering weight loss drugs, PBMs are under pressure to limit access or extract better terms. Yet public demand for these medications—fueled by clinical results and media coverage—shows no signs of slowing.

At the same time, manufacturers are investing in novel distribution models to blunt the impact of restrictive formularies. If direct-to-consumer channels prove successful, we may see further disintermediation of traditional pharmacy benefit models, particularly for high-demand therapies such as GLP-1s.

This most recent news highlights the opaque, rebate-driven logic that governs drug access in the U.S. healthcare system. For patients and providers, these formulary decisions can feel arbitrary, but they reflect calculated tradeoffs in a profit-driven and competitive supply chain.

The rise of GLP-1s has brought new urgency to these questions. As manufacturers, payers, and PBMs jockey for position, the patient sits uncomfortably in the middle.