Eli Lilly markets tirzepatide as Mounjaro for diabetes and Zepbound for weightloss.

According to Judge Altman, Lilly’s attempt to prevent this through the courts was seen as an effort to circumvent federal law.

“We think Eli Lilly is using state law to enforce the terms of the FDCA [Federal Food, Drug, and Cosmetic Act], which … is a task generally ‘reserve[d] to the FDA,'” Altman wrote, adding that the court will not allow Lilly “to use state law as a back door to private enforce the FDCA.”

“As the Supreme Court has made clear, ‘the FDCA and its regulations provide the United States with nearly exclusive enforcement authority,'” the judge’s ruling states. “Given the federal government’s ‘nearly exclusive’ authority to enforce the FDCA, courts around the country have generally refused to encroach on that authority by adjudicating claims that a party has (or has not) complied with the FDCA.”

In September 2023, Eli Lilly announced legal action against ten entities in the U.S., including medical spas, wellness centers, and compounding pharmacies, alleging that they have been selling unauthorized, less expensive versions of Mounjaro.

Lilly competitor Novo Nordisk A/S (NYSE:NVO), which markets Ozempic and Wegovy, has also been going after compounding pharmacies and wellness clinics for selling altered versions of semaglutide. 

The Danish drugmaker found these impurities to be as high as 33% in some instances, raising concerns about the safety and efficacy of the compounded drugs.

Price Action: LLY shares are up 0.15% at $760.76 on the last check Friday.

Wegovy. Image Via Shutterstock