Wegovy claims soared 91% in 2024 as insurers weigh coverage limits and rising plan costs
Claims for weight-loss medications in Canada surged by 91 percent last year, prompting warnings about the financial sustainability of private drug plans, The Globe and Mail reported.
A Telus Health report released this week said insurers saw a sharp rise in patient claims in 2024 following the market launch of Wegovy, a weight-loss drug derived from the diabetes treatment Ozempic.
Although Health Canada approved Wegovy in 2021, supply chain challenges delayed its Canadian release until May 2023.
Insurers paid nearly $77m for weight-management drugs in 2024, almost doubling the $38m paid the previous year.
The increase marks a significant shift for employer-funded benefit plans, as the cost of claims directly affects company expenses.
According to Telus Health, weight-management drugs—excluding Ozempic, which is listed as a diabetes drug—ranked as the 17th most prescribed medication in Canada in 2024, up from 54th in 2016.
The number of people reimbursed for these drugs rose 59 percent year-over-year. The average annual cost per claimant reached $2,012, up from $1,572 in 2023.
Telus Health stated that both metrics are expected to continue rising quickly as Wegovy draws more new patients.
Paul Sabat, a group benefits adviser and managing partner at The Consulting House Inc. in Vaughan, Ontario, said the growth in claims requires deliberate planning.
He said “balancing cost control with compassionate, forward-thinking care will require strategic design, evidence-based coverage, and better education around how and when these drugs should be used.”
He added that “the stakes are high for employee health and the long-term sustainability of private drug plans.”
Sabat said he speaks with clients daily about the growing volume of weight-management drug claims, mainly driven by Wegovy.
He noted that some plan sponsors are removing pre-authorization requirements for these drugs to improve access and reduce long-term health costs.
Others are reacting differently, narrowing the list of approved medications or reassessing coverage. Sabat described the responses as polarized.
“While there’s clear potential to improve health outcomes and reduce long-term claims, such as long-term disability or critical illness, the sharp rise in usage and high price point are putting serious pressure on drug plan sustainability,” he said.
Weight-loss drugs, while popular internationally, are still not standard coverage in many Canadian insurance plans.
Employers often apply strict conditions to medications like Ozempic, such as only reimbursing it for diabetes or placing limits on payouts.
Vicky Lee, director of pharmacy consulting and professional services at Telus Health, said group plans are evolving.
She noted that “these types of drugs used to be a standard exclusion in many group plans,” but there has been a shift in the medical community where weight management is increasingly seen as a chronic condition.
“We are seeing more plans add coverage for this class of drug,” she said.
Lee added that Wegovy’s potential market in Canada is large. Citing 2023 Statistics Canada data, the Telus Health report noted that more than 30 percent of Canadians are obese and another 36 percent are overweight.
Weight-loss drug use in Canada began rising with Saxenda in 2015 and Contrave in 2018.
Telus Health said both drugs regulate hormones that affect hunger and fullness, and they appear in Canadian clinical guidelines as effective obesity treatments.
Saxenda currently leads in prescriptions, with 44 percent of claimants using it.
However, Wegovy has already captured 31 percent of claimants just eight months after its launch.
Telus found that nearly one in six Wegovy users previously used Saxenda.
The report noted that Wegovy’s ability to reduce body weight by 10 to 15 percent triggered the sharp rise in weight-management drug claims.
Lee said Health Canada is not reviewing any new weight-loss drugs at present, which leaves few alternatives to Wegovy.
However, this could shift within two to three years, as trials show that Zepbound and CagriSema could reduce body weight by 20 percent and 23 percent, respectively.
