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It has been several years since GLP-1 medications took the health and wellness landscape by storm. While this class of drugs was introduced to the market as a treatment for Type 2 diabetes 20 years ago, it has gained widespread attention as a solution for weight loss and has been driving up prescription drug spending in the U.S.
GLP-1s are the top drug category by total spending and the fastest-growing segment in the market, according to a 2025 report by the American Society of Health-System Pharmacists.
Given the strong interest in this drug class, we looked at how the GLP-1 market continues to evolve and how employers can make informed decisions about whether to cover these medications.
Broadening scope
Many drug manufacturers are pursuing expanded uses for GLP-1 medications beyond diabetes and weight loss.
Earlier this year, the U.S. Food and Drug Administration (FDA) approved Novo Nordisk’s Ozempic to treat chronic kidney disease in individuals with Type 2 diabetes. Similarly, the FDA gave the green light to Eli Lilly’s Zepbound for the treatment of moderate to severe obstructive sleep apnea in adults with obesity.
Researchers are also exploring the use of GLP-1s for non-alcoholic fatty liver disease and neurogenerative diseases. As new indications emerge, demand for these medications is likely to grow.
A strong pipeline
New GLP-1 therapies are in development, creating the potential to disrupt the market. In April, Eli Lilly announced positive results from a phase three clinical trial of orforglipron, an oral GLP-1. The company said orforglipron demonstrated a safety profile consistent with injectable GLP-1 medicines. Currently, Rybelsus is the only oral GLP-1 on the market.
The introduction of more oral options could be a game-changer for the GLP-1 market because pills are generally cheaper to produce than injectable medications, according to the Scientific American.
Unknown health concerns
While demand for these drugs remains strong, there are many uncertainties surrounding the long-lasting risks of taking GLP-1s.
Researchers at the Washington University School of Medicine in St. Louis and the Veterans Affairs St. Louis Health Care System conducted a large study of more than two million people with diabetes taking GLP-1 medications. They found an association between GLP-1s and a decreased risk of dementia, but they also discovered increased risks for pancreatitis and kidney conditions.
GLP-1s can be an effective treatment for diabetes and weight loss, but these medications are costly, and the long-term health risks associated with them are still unclear.
As an employer or benefits advisor, you may wonder whether covering GLP-1s makes sense for your organization. Here are some considerations to keep in mind.
A strategic approach: Take a comprehensive look at the needs of your organization. Is offering these drugs for weight loss a viable option? Do the potential long-term benefits of improved employee health and productivity outweigh the significant costs? Are there lower-cost alternatives that may be effective?
Employee education: Help your workforce understand the benefits of taking GLP-1s, as well as the costs associated with them. Promote lifestyle changes, such as a healthy diet and regular exercise, alongside the use of medical treatments. This approach creates shared accountability, which means payers and patients are working together to achieve lasting health improvements.
Create guardrails: If your organization chooses to cover these medications, consider putting in guardrails, such as limiting GLP-1s for weight loss to individuals with certain body mass index.
At Oswald, we stay up to date on changes in the health and wellness space and work with insurers, pharmacy benefit managers and providers to help employers develop solutions that meet their individual needs. We can help you develop a GLP-1 strategy that makes sense for your workforce and budget.
Contact the experienced employee benefits team at Oswald and start developing a tailored GLP-1 strategy for your workforce.
