Commusings: Paying Big Pharma — For Life

Dear Commune Community,

Have you ever wondered how health insurers can cover expensive drugs like Wegovy and still turn a profit? Today, I’m going to break it down.

Wegovy is a weight-loss drug that’s part of a class called GLP-1 agonists. The drug is a derivative of Ozempic, an anti-diabetes drug made by the pharmaceutical giant, Novo Nordisk. The list price for Wegovy is $1,350 for a 28-day supply. It costs about 1% of its list price to produce.

In the United States, drug companies can set their own prices without government negotiation or intervention. And they can hold exclusive patents on drugs to eliminate competition from offering cheaper options. 

So, Wegovy is an effective drug for weight loss. But it only works if you keep taking it – forever. By keeping the consumer hooked and with no competition, the drug companies are ensured consistent profits.

It’s pretty easy to see how this is a boon for Pharma. But how could it possibly make sense for insurers to cover this cost? 

This is where the hidden negotiations take place – in the form of rebates. 

Pharmacy Benefit Managers, or PBMs, negotiate deals between Big Pharma and health insurers. Wegovy’s manufacturer might say, “We’ll give you a $500 rebate per prescription if you cover our drug.’ Sounds great, right? But here’s the catch.”

The rebate is based on the drug’s list price, which stays high. So even after the rebate, given the margins on the product, Big Pharma still makes a huge profit. And the PBMs? They keep a slice of that rebate too.

Now let’s look at the insurer. They cover Wegovy, but they’re not losing money. Why? Because they spread the cost across everyone’s premiums. Most people also have plans with high deductibles, so insurers don’t start paying until you’ve gone out of pocket thousands of dollars. 

In addition, most plans have co-pays – and sometimes these co-pays are based on a percentage of the list price. But insurers are not paying the list price for Wegovy. For other patients, Wegovy might feel relatively affordable—just a $50 co-pay. 

But the insurer offsets the expense by raising premiums for everyone else. That’s why your insurance costs are going up year after year.

Here’s the kicker: This system actually incentivizes high drug prices. Why? Because the higher the price, the bigger the rebate—and the more everyone in the chain profits. Big Pharma wins. PBMs win. Insurers win. But who loses?

You guessed it — you and me. We pay higher premiums and out-of-pocket costs, while never addressing the root cause of obesity and weight-related issues. 

So, what can we do? To start, we need to instill transparency in drug pricing and rebate systems. We need the ability for the government to set pricing caps based on the actual cost of creating these drugs. And we need to curtail Big pharma’s ability to advertise directly to the consumer.

But, really, if we’re going to escape this vicious cycle, we need a totally different approach to health care that focuses on treating the root cause instead of treating conditions like obesity with drugs. 

We need to focus on helping people not develop disease in the first place. We need to inspire them to reclaim agency over their own health and reverse the chronic conditions they do have. This is 100% possible. 

Here at Commune, we send out a biannual survey, and I was perusing the results recently when the responses from a Lifetime Member named Casey caught my eye. This is what she wrote when we asked her about her wellness challenges this past year: 

Loss of a pet, family medical issues, and personal health concerns (chronic pain, illness, etc.) have resulted in major dips in my mental health. 

My Commune membership has been transformative and life-saving. I've lost more than 60 pounds through intermittent fasting and yoga, and Commune's EFT tapping meditations facilitated my establishment of a daily meditation practice for the past 2.5 years.

Thank you, and many blessings upon you, Commune Team!

We are once again running the same flash sale – $359 for a Lifetime Commune Membership – that Casey used to become a Lifetime Member. 

I could fill this email with stories of Commune Members who have turned their lives around, gotten off their prescriptions, and reversed chronic disease with the courses we offer in Membership.

But what matters is YOU. 

Do you want to be hooked on a prescription drug, or do you want to take your health back into your own hands? 

The science is clear: Chronic disease is not a destiny, but rather the normal and expected result of our stressed-out, over-processed, toxic modern lifestyles. 

The teachers on Commune are here to help you navigate your way through this maze.

And while there’s a lot wrong with the current healthcare industry, there are people trying to make it better. 

We have partnered with one such organization, Truemed, so that you can now use your Health Savings Account (HSA) or Flexible Spending Account (FSA) funds toward purchasing a Commune Lifetime Membership.

The result: You pay with pre-tax dollars, meaning most people save an additional 30% or more on the price of Lifetime Membership (which is already 50% off through Tuesday). 

It’s very easy to use. Once you purchase a Lifetime Membership, look for a link on the confirmation page that says “Get Reimbursed” and follow the instructions. 

And even if you don’t have an HSA or FSA, Lifetime Membership is still a really good deal. Normally at this point, I do a calculation such as, “If you expect to live another 20 years, then Lifetime Membership is just $1.49 per month, less than a parking meter.” 

Here’s a slightly different calculation given today’s theme: According to a KFF study the average copay for prescription brand-name medications is between $36 to $66. 

A Lifetime Membership is thus equivalent to just 5 to 10 months of brand-name drug copays. And remember, if you get hooked on a drug like Wegovy – unless you get unhooked – you are expected to take that drug for life.

Which sounds like a better deal?