By Fineline Cube Novo Nordisk (NYSE: NVO) and Eli Lilly (NYSE: LLY) have lowered list prices for their top‑selling obesity drugs Wegovy and Mounjaro in China by 48‑80% in a strategic move to defend market share against domestic competitors and ahead of semaglutide patent expiry in 2026. The price cuts, effective January 1, 2026, position both companies to capture volume in the world’s fastest‑growing GLP‑1 market.
Price Cuts Overview
| Drug | Dosage | Previous Price (¥/month) | New Price (¥/month) | Reduction | Effective Date |
|---|---|---|---|---|---|
| Wegovy | Highest dose (2.4mg) | 1,899 | 987 | 48% | Jan 1 2026 |
| Wegovy | Medium dose | 2,470 | 1,284 | 48% | Jan 1 2026 |
| Mounjaro | 10mg pen | 2,180 | ~445 | 80% | Jan 1 2026 |
Source: Provincial procurement platforms and online pharmacies (JD Health, Ali Health).
Market Context & Competitive Pressure
China GLP‑1 Market Dynamics:
- Market Size: ¥18 billion (2025), projected ¥45 billion by 2030 (35% CAGR)
- Patient Population: 100 million+ obese adults; diagnosis rate <5%
- Current Coverage: <1% of eligible patients receive branded GLP‑1 therapy due to high cost
Domestic Competition:
- Hangzhou Zhongmei (GLP‑1 biosimilar): ¥600‑800 monthly
- Jiangsu Hengrui (tirzepatide biosimilar): ¥500‑700 monthly
- Shandong Luye (oral semaglutide): ¥400‑600 monthly
Strategic Imperative: Price cuts are defensive to maintain 20‑30% market share vs. 60‑70% share for domestic players by 2028.
Patent Expiry Catalyst
Semaglutide Patent Timeline:
- China Expiry: 2026 (formulation patents)
- US/EU Expiry: 2031‑2032
- Impact: 15‑20 generic/biosimilar entrants expected in China by Q4 2026
Mounjaro Patent Status: Tirzepatide patents expire 2036+ globally, but Lilly’s aggressive pricing aims to pre‑empt semaglutide generics and lock in early market share.
Financial Impact & Volume Strategy
Novo Nordisk China Revenue:
- 2025: ¥3.2 billion (Wegovy + Ozempic)
- 2026E Post‑Cut: ¥4.5‑5.0 billion (volume surge offsetting price drop)
- Margin Impact: Gross margin on Wegovy drops from 92% to 78%, but operating margin remains 45‑50% due to scale
Eli Lilly China Revenue:
- 2025: ¥800 million (Mounjaro)
- 2026E Post‑Cut: ¥2.8‑3.2 billion (300‑400% volume increase projected)
Net Impact: Both companies trade price for volume, expecting 2‑3x patient growth to offset 50‑80% price reductions.
Reimbursement & Access Pathway
NRDL Strategy:
- Current Status: Neither drug is National Reimbursement Drug List (NRDL) covered for obesity
- Post‑Price Cut: Pivotal for 2026 NRDL negotiation (price threshold typically ¥1,000‑1,500/month)
- Outcome: Novo aims for conditional NRDL inclusion in H2 2026; Lilly already submitted Mounjaro at new price
Hospital Access: Price cuts enable inclusion in 2,000+ tertiary hospitals (vs. 800 currently), expanding from tier‑1 cities to tier‑2/3 markets.
Competitive Response
Domestic Players:
- Zhongmei: Held price at ¥700, gaining premium positioning for quality‑conscious consumers
- Hengrui: Dropped to ¥450 (matching Mounjaro), triggering price war in tier‑2 cities
- Luye: Oral semaglutide at ¥500 offers convenience advantage over injectables
Investor Implication: Margin compression across GLP‑1 sector; winners will be those with lowest COGS and broadest distribution.
Forward‑Looking Statements
This brief contains forward‑looking statements regarding price cut sustainability, volume uptake, NRDL inclusion probability, and competitive market share shifts. Actual results may differ materially due to regulatory decisions, domestic player responses, and patient adoption rates.-Fineline Info & Tech