Why Omada Health is finally prescribing Ozempic as TrumpRx slashes GLP-1 weight-loss drug costs

Core Insights - Omada Health, a chronic care startup, will begin prescribing GLP-1 medications for obesity, a shift from its previous stance of leaving such decisions to primary care providers [1][3] - The decision comes after a deal announced by President Trump to significantly reduce out-of-pocket costs for GLP-1 drugs, which are expected to drop from over $1,000 to a range of $50 to $350 per month [2][12] Company Strategy - CEO Sean Duffy indicated that the company will start offering GLP-1 prescriptions in the first half of 2026, responding to feedback from primary care providers and employer customers about the complexity of the GLP-1 landscape [3][5] - The decision to prescribe GLP-1s was influenced by the expectation of rising overall costs for employers following potential FDA approval of oral versions of these drugs, which are anticipated to be cheaper but may increase patient demand [6][12] Market Context - The Trump administration's announcement included deals with drugmakers Eli Lilly and Novo Nordisk to provide discounts on GLP-1 drugs, part of a broader effort to offer discounted medications through the TrumpRx program [10][11] - Medicare will now cover GLP-1 drugs for weight loss, allowing some qualifying patients to pay only a $50 monthly co-pay, which could increase demand for these medications [12] Operational Plans - Omada plans to pair its new GLP-1 prescribing program with human and AI coaching to support members throughout their treatment journey, including assistance with tapering off prescriptions [13][14] - The company will utilize a third-party telehealth solution to source clinicians for prescribing GLP-1s, indicating a strategic move to enhance its service offerings [15] Financial Performance - Omada's third-quarter earnings exceeded investor expectations, although the stock dropped over 7% following the announcement, reflecting concerns about profitability and competition in the digital health market [16][17] - The company narrowed its losses to approximately $3.2 million in the third quarter, highlighting ongoing financial challenges despite positive operational metrics [16]