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General Motors, Ford Motor and Stellantis should exit the Chinese market “as soon as they possibly can,” Bank of America’s top automotive analyst said Tuesday.
The rise of local Chinese automakers, such as BYD and Geely, has put growing pressure on the companies.
President Joe Biden announced last month that his administration would quadruple tariffs on China-made electric vehicles.

Employees on the assembly line produce cars in Mazda’s “Family” line of vehicles at China First Automobile Works (FAW) Group Haima Automobile Co., Ltd. April 6, 2005 in Haikou, Hainan Province, China.
China Photos | Getty Images

DETROIT – The traditional Detroit automakers – General Motors, Ford Motor and Stellantis – should exit the Chinese market “as soon as they possibly can,” Bank of America’s top automotive analyst said Tuesday.
The warning from BofA Securities research analyst John Murphy comes amid unprecedented competition in China – the world’s largest auto market – and as the country significantly increases vehicle production for Chinese consumers as well as for global exports.

Murphy, who has previously asked General Motors about exiting the market, said the “D3” automakers need to focus on their core products and more profitable regions.
“I think you have to see the D3 exit China as soon as they possibly can,” he said Tuesday during an Automotive Press Association event to discuss BofA’s annual “Car Wars” report in suburban Detroit. He said, “China is no longer core to GM, Ford or Stellantis.”
It’s a prospect that would have been unthinkable for the automakers, specifically GM, just a few years ago, but the rise of local Chinese automakers, such as BYD and Geely, has put growing pressure on the companies.
GM’s market share in China, including its joint ventures, has plummeted from roughly 15% as recently as 2015 to 8.6% last year — the first time it has dropped below 9% since 2003. GM’s earnings from the operations have also fallen, down 78.5% since peaking in 2014, according to regulatory filings.
GM executives have said they believe they can turn around the operations and regain market share in China, largely with the help of new electric vehicles.

There’s also geopolitical risks and uncertainty for U.S. companies operating in China. President Joe Biden announced last month that his administration would quadruple tariffs on China-made electric vehicles.
While the Detroit automakers need to rethink the way their doing business in China, Murphy said it’s slightly different for U.S. electric vehicle leader Tesla.
Murphy said Tesla has a roughly $17,000 cost advantage in EV components compared with the traditional Detroit automakers to assist the company in the Chinese market, allowing it to have “more room to run.”

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Fisker on Monday became the latest all-electric vehicle startup to file for Chapter 11 bankruptcy protection.
The new filing comes after the automaker failed to secure an investment from a big automaker to keep afloat.
Consumer adoption for EVs has grown slower than expected, costs have risen and investor interest in EVs other than Tesla has dried up.

Henrik Fisker stands with the Fisker Ocean electric vehicle after its unveiling at the Manhattan Beach Pier ahead of the Los Angeles Auto Show and AutoMobilityLA in Manhattan Beach, California. on Nov. 16, 2021.
Patrick T. Fallon | AFP | Getty Images

Fisker on Monday became the latest all-electric vehicle startup to file for Chapter 11 bankruptcy protection amid lackluster consumer demand, significant cash burn and operational and product issues.
For investors, the writing’s been on the wall for some time as Fisker issued a going concern about its ability to continue as a company in February, leading its charismatic founder and CEO Henrik Fisker to disappear from social media and the limelight.

It’s the latest in a series of EV companies to collapse. Other companies backed by special purpose acquisition companies, or SPAC, have also filed for bankruptcy protection. That list includes companies such as Proterra, Lordstown Motors and Electric Last Mile Solutions. Others such as Nikola and Faraday Future remain in business but trade for under $1 per share amid operational challenges, missed targets and broader industry headwinds.
It’s also a bit of déjà vu, as it marks Henrik Fisker’s second car company, both branded under his last name, to file for bankruptcy protection.
The new filing comes after the Fisker company failed to secure an investment from a big automaker to keep afloat. Nearly four years ago, Fisker announced plans to go public through a reverse merger with an Apollo-backed SPAC that valued the company at $2.9 billion. The deal infused Fisker with more than $1 billion in cash.
Fisker, like many other companies at the time, was fueled by low interest rates and a bullishness on Wall Street around EVs following the rise of U.S. electric vehicle leader Tesla.
“They looked at Tesla’s success, and Tesla was more of an anomaly than an example,” said Sam Abuelsamid, principal research analyst at Guidehouse Insights.

But consumer adoption for EVs has grown slower than expected, costs have risen and investor interest in EVs other than Tesla has dried up. The company also faced significant issues with its operations as well as the launch of its first product, called the Ocean SUV EV.

Software focus

When going public through a SPAC in 2020, Henrik Fisker compared the company with U.S. EV leader Tesla. He also touted its production relationship with Canadian auto supplier Magna, comparing it with the relationship between Apple and Foxconn.
The automaker, unlike most of its peers, contracted a third-party manufacturer to build the Fisker Ocean crossover. The partnership with Magna was supposed to be an “asset-light” strategy, as Fisker described it, to allow the company to save cash and focus on differentiating technologies, such as software.
Abuelsamid said such a strategy isn’t inherently bad, but he called the management of the company inept and pointed the finger at Geeta Gupta-Fisker, the company’s chief financial officer and chief operating officer. Gupta-Fisker is also Henrik Fisker’s wife.
“That approach can be made to work,” he said. “The problem in the case of Fisker that I underestimated was … the incompetency of the senior management.”

The company burned through cash and last month recalled thousands of Ocean SUVs in North America and Europe due to issues with vehicle software.
According to the company’s Chapter 11 filing, it owes millions to software and engineering companies, such as Adobe, SAP America, Manpower Group and Prelude Systems, among others. CNBC parent company NBCUniversal is also listed as a top creditor.
“[The auto industry is] capital intensive. You’re trying to match production, consumer demand and when they have any kind of issue with the vehicle, money has to be allocated to that,” said Stephanie Valdez Streaty, Cox Automotive Director of Industry Insights. “Also when they don’t have other revenues like [internal combustion engines] to fund it … it makes it very challenging.”
Its operating unit, Fisker Group Inc., estimated assets of $500 million to $1 billion and liabilities of $100 million to $500 million.
At the end of last year, Fisker had $530 million in inventory, as it only sold 4,700 of the more than 10,000 Ocean EVs it had produced in 2023.

Déjà vu

For Henrik Fisker, a renowned automotive designer credited with designing the BMW Z8 and Aston Martin DB9, it’s déjà vu.
His first namesake company – Fisker Automotive – filed for bankruptcy protection in 2013, shortly after he left the company. It later sold its assets to China’s Wanxiang Group for $150 million.
It was supposed to be better the second time around for the founder, who said he had learned from his past mistakes with his former bankrupt company.
“Having done this before, I’m in a unique position to kind of almost take lessons learned, which is very rare especially in the car industry,” he said in 2017, a year after launching the new company.
But the parallels between the two failed companies are hard to ignore.
Both companies were much-hyped, largely by Fisker himself claiming they would revolutionize the industry. They were fueled by “free” money – first federal funds, more recently Wall Street – on the premise that “green,” or electrified, vehicles were the future of the auto industry.
Both also faced significant quality problems that led to recalls. The first Karmas produced by Fisker were recalled for a battery safety issue and fire risk in 2011.

Both companies also changed direction and priorities many times.
After delivering less than half of the more than 10,000 vehicles it produced through a direct-to-consumer approach that resembled Tesla’s model, the second Fisker turned to a dealership-based distribution model in January.
But there was one key difference this time. With the failure of the second Fisker, its investors were left out to dry instead of American taxpayers. While Henrik Fisker’s first company was boosted by a $529 million federal loan — $139 million of which the government lost — the second was funded through Wall Street’s bullishness on SPACs and EVs. Its stock was delisted in April.
A Fisker spokesperson said in a statement early Tuesday that the company is “proud of our achievements” but determined that Chapter 11 was the best option.
“Like other companies in the electric vehicle industry, we have faced various market and macroeconomic headwinds that have impacted our ability to operate efficiently,” the spokesperson said in a release. “After evaluating all options for our business, we determined that proceeding with a sale of our assets under Chapter 11 is the most viable path forward for the company.”

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Boeing CEO Dave Calhoun will face questions from the Senate Permanent Subcommitee on Investigations on Tuesday over quality control concerns and whistleblower allegations.

Boeing’s bestselling 737 Max plane has been the source of controversy since two deadly crashes in 2018 and 2019. Scrutiny of the company increased again after a door plug blew out of one of its nearly new 737 Max planes during an Alaska Airlines flight in January.
Following the incident, company whistleblower Sam Salehpour came forward and claimed that the aerospace company put excessive stress on airplane joints, which reduced some of the planes’ lifespans. Boeing denied the claims as “inaccurate.”
The subcommittee released new whistleblower claims Tuesday from Boeing quality assurance investigator Sam Mohawk, who alleges that the company lost track of parts that were damaged or not up to specification. Mohawk alleges that the lost parts were likely installed on airplanes in Boeing’s Washington plant where 737 Max models are made.
The company announced March that Calhoun will step down from his post as CEO before the end of the year.
— CNBC’s Leslie Josephs contributed to this report
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While millennials and members of Generation Z are expecting the biggest inheritances in the coming years as baby boomers pass down their fortunes, Gen Xers will likely get the largest windfalls in the near term.
According to Wealth-X, the average age of individuals in North America set to inherit fortunes from parents worth $5 million or more is 46.1 years old.
The findings cast a spotlight on the large wealth potential for Generation X, which has been largely overlooked in the discussion of young inheritors.

Fg Trade | E+ | Getty Images

Generation X may be the biggest beneficiary from the $84 trillion Great Wealth Transfer in the next 10 years, according to a new study.
While millennials and members of Generation Z are expecting the biggest inheritances in the coming years as baby boomers pass down their fortunes, Gen Xers will likely get the largest windfalls in the near term. According to Wealth-X, the average age of individuals in North America set to inherit fortunes from parents worth $5 million or more is 46.1 years old.

The average age of children expected to receive the most substantial inheritances — from parents worth $30 million or more — is 47.6, according to the study. The study defines members of Gen X as being between the ages of 44 and 59 today, and millennials as between the ages of 28 and 43.

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The findings cast a spotlight on the large wealth potential for Generation X, which has been largely overlooked in the discussion of young inheritors. Wealth management firms and private banks have largely been focused on potential clients in their 20s and 30s as they wait for trillions to be passed down by families. More than half of millennials are expecting an inheritance of at least $350,000, according to Alliant Credit Union.
The Wealth-X report suggests that wealth management firms, luxury companies and real estate firms targeting the next generation of wealthy clients should also start considering Generation X.
“Much is often made in the media of millennial and Generation Z heirs but, in fact, Generation X will be first in line to inherit from their wealthy parent(s),” according to the report.
The report said that for now, millennials and Gen Z “are more likely to receive sums as grandchildren, which will often be less substantial.”

Inheritances will be extremely concentrated at the top. In the next 10 years, 1.2 million individuals worth $5 million or more will pass down a total of more than $31 trillion in wealth, according to the report. Of that amount, nearly two-thirds, 64%, will be from the ultra-wealthy, defined as those worth $30 million or more. In other words, nearly $20 trillion will be passed down from 155,000 people in that upper echelon of wealth.
The super-wealthy, or those worth $100 million or more, will account for nearly half the $31 trillion total being handed down. Billionaires will pass down about $5 trillion, according to the report.
Inheritors will have different values and priorities from previous generations, which wealth managers, luxury firms and philanthropies need to adapt to. The next generation of investors are more tech influenced, more focused on the environment and social justice and more global, according to the report.
“New technologies, the clean-energy transition and ‘impact investing’ will be a focus of many heirs’ ambitions, which may not necessarily align with a family’s existing business structures or the legacy plans of those transferring their fortunes,” the report said.

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Boeing CEO Dave Calhoun faces a Senate panel over ballooning safety and quality control crises with the plane-maker.
Boeing is under fire after a door plug blew out of one of its nearly new 737 Max planes in January during a flight.
The Senate subcommittee released whistleblower claims on Tuesday from Boeing employee Sam Mohawk, alleging the company lost track of parts that were damaged or not up to specification.

Dave Calhoun, CEO of Boeing, leaves a meeting with Sen. Dan Sullivan, R-Alaska, in Hart Building, on Wednesday, January 24, 2024. Calhoun was meeting with senators about recent safety issues including the grounding of the 737 MAX 9 planes.
Tom Williams | Cq-roll Call, Inc. | Getty Images

Boeing CEO Dave Calhoun plans to tell a Senate panel on Tuesday that the company’s culture is “far from perfect” as fresh whistleblower claims surface just hours before the hearing that allege the company mishandled hundreds of defective parts.
Calhoun, who has said he will step down before the end of the year, faces questions from the Senate Permanent Subcommittee on Investigations as the company works to improve employee training and aircraft quality and to fix its tarnished safety reputation. The company has still not named a replacement for Calhoun, who took over after its previous leader was ousted for his handling of two fatal Boeing crashes.

“Much has been said about Boeing’s culture. We’ve heard those concerns loud and clear. Our culture is far from perfect, but we are taking action and making progress,” Calhoun plans to tell the subcommittee, according to written testimony ahead of the hearing.
The subcommittee released whistleblower claims on Tuesday from Sam Mohawk, a quality assurance investigator at Boeing, alleging the company lost track of parts that were damaged or not up to specification and that “those parts are likely being installed on airplanes.” The parts Mohawk flagged were in Boeing’s Renton, Washington, plant, where the company makes its best-selling 737 Max.
Mohawk said he was retaliated against and that he was told by supervisors to hide evidence from the Federal Aviation Administration, according to a memo shared by the committee on Tuesday. Dozens of important parts were stored outside during an FAA inspection, including 42 rudders as well as winglets and stabilizers, Mohawk alleged in claims with the Occupational Safety and Health Administration, the memo said.
A Boeing spokeswoman said that the company received the claims Monday night and that staff are reviewing them.
“We continuously encourage employees to report all concerns as our priority is to ensure the safety grof our airplanes and the flying public,” she said.

The FAA said it has seen an increase in the number of reports from Boeing staff since the door-plug blowout in January.
“We thoroughly investigate every report, including allegations uncovered in the Senate’s work,” the agency said Tuesday. The FAA declined to comment on the specifics of the latest allegations.
Mohawk is not testifying before the Senate subcommittee’s hearing, which starts at 2 p.m. ET.
The hearing and new whistleblower claims are further complicating matters for Boeing. The company already faces potential U.S. prosecution after the Justice Department said last month that the plane-maker violated a 2021 settlement tied to 737 Max crashes in 2018 and 2019 that claimed 346 lives. That agreement, which protected the company and its executives from facing criminal charges tied to the crashes, would have expired just days after the blowout of the Alaska Airlines door panel in January. The Justice Department has until July 7 to decide whether to prosecute.
Several victims’ family members are expected to attend Tuesday’s hearing. Relatives of Max crash victims met with Justice Department officials late last month to urge the U.S. to prosecute.
“Boeing made a promise to overhaul its safety practices and culture. That promise proved empty, and the American people deserve an explanation,” said Sen. Richard Blumenthal, D-Conn., the subcommittee’s chairman, upon announcing the hearing earlier this month.

The FAA has taken a hard line against Boeing, with FAA Administrator Mike Whitaker saying the regulator will keep inspectors on the ground at the company’s facilities until the agency is satisfied with safety improvements.
The FAA had already halted Boeing’s ability to increase production of the Max, its bestselling plane. Whitaker last month said it would likely be several months before lifting that restriction.
Boeing’s aircraft output has suffered from the resulting crisis, forcing big customers such as Southwest Airlines and United Airlines to adjust their growth and hiring plans.
Boeing’s lower production and deliveries have hurt its cash flow, and the company warned investors last month that it would burn instead of generate cash this year.
Boeing’s shares are down more than 30% so far this year as of Monday’s close, compared with a nearly 15% gain in the S&P 500.
The company is trying to stamp out quality flaws on jets and reduce so-called traveled work in which production steps are completed out of order, something it has done to address defects. Last month Boeing pointed to a host of other changes to encourage workers to speak up about problems in its factories after several whistleblowers raised concerns about quality issues and retaliation.
Separately, Boeing is facing supply chain issues. Spirit AeroSystems, a major supplier for both Boeing and Airbus, said last week that titanium entered the supply chain with falsified documents. The supplier said that despite the falsified documentation, more than 1,000 tests confirmed that the material is “airplane-grade titanium.”
Boeing has been trying to purchase fuselage supplier Spirit, a deal Calhoun said is “more than likely” to be finalized in the first half of the year. More

The Food and Drug Administration approved Merck’s vaccine designed to protect adults from a bacteria known as pneumococcus that can cause serious illnesses and a lung infection called pneumonia.
An advisory panel to the Centers for Disease Control and Prevention will meet on June 27 to discuss who should be eligible for the shot, called Capvaxive
Some analysts view the jab as a key growth driver for Merck as it prepares to offset losses from its blockbuster cancer drug Keytruda.

Arrows pointing outwards

Merck’s new pneumococcal vaccine.
Courtesy: Merck

The Food and Drug Administration on Monday approved Merck’s new vaccine designed to protect adults from a bacteria known as pneumococcus that can cause serious illnesses and a lung infection called pneumonia, the drugmaker said.
Merck’s shot, called Capvaxive, specifically protects against 21 strains of that bacteria to prevent a severe form of pneumococcal disease that can spread to other parts of the body and lead to pneumonia. It’s the first pneumococcal conjugate vaccine designed specifically for adults and aims to provide broader protection than the available shots on the market, according to the drugmaker.

Healthy adults can suffer from pneumococcal disease. But older patients and those with chronic or immunocompromising health conditions are at increased risk for the illness, especially the more serious or so-called “invasive” form. 
Invasive pneumococcal disease can lead to meningitis, an infection that causes inflammation in the area surrounding the brain and spinal cord, and an infection in the bloodstream called bacteremia. 
“If you have chronic lung disease, even asthma, you have a higher risk of getting sick with pneumococcal disease, and then being in the hospital, losing out on work,” Heather Platt, Merck’s product development team lead for the newly cleared vaccine, told CNBC in an interview. “Those are things that have a real impact on adults and children, their quality of life.”
Around 150,000 U.S. adults are hospitalized with pneumococcal pneumonia each year, Platt said. Death from the more serious form of the disease is highest among adults 50 and above, Merck said in a release in December.
Even after the FDA approval, the company’s single-dose vaccine won’t reach patients just yet. An advisory panel to the Centers for Disease Control and Prevention will meet on June 27 to discuss who should be eligible for the shot.

Platt said Merck will support the committee’s decision and is ready to supply the vaccine by late summer. 

Merck’s competitive edge

Some analysts view Capvaxive as a key growth driver for Merck as it prepares to offset losses from its blockbuster cancer drug Keytruda, which will lose exclusivity in the U.S. in 2028. 
The market for pneumococcal conjugate vaccines is currently around $7 billion and could grow to be worth more than $10 billion over the next several years, according to a November note from Cantor Fitzgerald analysts. 
Merck’s newly approved shot could boost its competitive edge in that space, which includes drugmaker Pfizer. Merck currently markets two pneumococcal shots, but neither is specifically designed for adults. For example, the company’s existing shot Vaxneuvance is approved in the U.S. for patients 6 weeks of age and older.
Pfizer’s single-dose pneumococcal vaccine, Prevnar 20, is the current leader in the market for adults. But Merck expects its new shot to capture the majority of market share among adults, Platt said. 
“We do expect there to be rapid uptake of” Capvaxive, she said, adding that the company is confident that data on the shot will “really resonate” with clinicians and policymakers. 
Merck’s pneumococcal vaccine protects against eight strains of the bacteria that are not included in any other approved shot for the disease. Those eight strains account for roughly 30% of invasive pneumococcal disease cases in patients 65 and above, according to a release from Merck, citing CDC data from 2018 to 2021. 
The 21 strains included in Merck’s shot account for roughly 85% of invasive pneumococcal disease cases in adults 65 and above, Merck, citing the CDC data. Meanwhile, Pfizer’s Prevnar targets strains that only account for roughly 51% of cases in that age group, based on the same CDC data. 
The FDA’s approval is partly based on Merck’s late-stage trial called STRIDE-3 that pitted the vaccine against Pfizer’s Prevnar 20 in adults 18 and up who had not previously received a pneumococcal vaccine.
Correction: This story has been updated to reflect 150,000 U.S. adults are hospitalized with pneumococcal pneumonia each year. More

In a factory in a smoggy corner of China’s inland Shaanxi province, the country’s world-leading solar industry is on display. Robots scoot around carrying square slices of polysilicon, a crystalline substance usually made from quartz. The slices, each 180mm across and a hair’s breadth thick, are called wafers. They are bathed in chemicals, shot with lasers and etched with silver. All that turns them into solar cells, which convert sunlight into electricity. Several dozen of these cells are then bundled together into a solar module. The factory, owned by LONGi Green Energy Technology, can churn out about 16m cells a day.China’s solar industry is dominant across every stage of the global supply chain, from the polysilicon to the finished product. Module production capacity in the country reached roughly 1,000 gigawatts (GW) last year, almost five times that of the rest of the world combined, according to Wood Mackenzie, a consultancy. What is more, it has tripled since 2021, outgrowing the rest of the world, despite efforts by America and others to boost domestic production. China is now able to produce more than twice as many solar modules as the world installs each year. More

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Eli Lilly has more work it wants to do with the hard-won success from its weight loss and diabetes drugs, Zepbound and Mounjaro, outgoing CFO Anat Ashkenazi told CNBC.
The company is working to ramp up manufacturing, expand patient access to the treatments and change long-held misconceptions about obesity.
She will step in as the new chief financial officer of Alphabet, the parent company of Google, on July 31.

A pharmacist holds boxs of Eli Lilly & Co. Mounjaro brand tirzepatide medication arranged at a pharmacy in Provo, Utah, US, on Monday, Nov. 27, 2023. 
George Frey | Bloomberg | Getty Images

Skyrocketing demand for a class of weight loss and diabetes treatments has lifted Eli Lilly to new heights over the last year. But the drugmaker has much more work it wants to do with that hard-won success, outgoing Chief Financial Officer Anat Ashkenazi told CNBC. 
Ashkenazi, who will step in as the new CFO of Alphabet on July 31, has been key to managing the windfall in revenue and wave of investor optimism from Eli Lilly’s diabetes injection Mounjaro and recently launched obesity drug Zepbound. Ashkenazi took over as CFO at Eli Lilly in 2021 after roughly two decades with the pharmaceutical giant. She was included on CNBC’s inaugural Changemakers list earlier this year.

“You have to be a really good student of the business and understand it inside and out and understand the industry,” she told CNBC in an interview before her departure announcement. “Only when we understand the full system, can we navigate it well so that we bring value to it…That’s my role as CFO.”
Her tenure hasn’t come without challenges: Eli Lilly and rival Novo Nordisk have both struggled to manufacture enough supply of their treatments to meet unprecedented demand, causing nationwide shortages of those drugs. 
Their weekly injections are part of a class of drugs called GLP-1 agonists, which mimic certain hormones produced in the gut to suppress a person’s appetite and regulate their blood sugar. Some analysts expect the market for those drugs to be worth $100 billion by the end of the decade. 
Eli Lilly’s boom in revenue has allowed the company to invest heavily to scale up manufacturing, which will eventually get more medicine into patients’ hands, Ashkenazi said. 
“As we start selling product and we get the revenue in and cash flow associated with that sale,” the company wants to “funnel that cash flow back to the business to invest in those manufacturing facilities,” she said. 

Eli Lilly does not expect to match the pace of demand this year and maybe not even in 2025, Ashkenazi said at a conference in March. But the pharmaceutical giant has made encouraging progress so far. 

An Eli Lilly and Company pharmaceutical manufacturing plant is pictured in Branchburg, New Jersey, on March 5, 2021.
Mike Segar | Reuters

Ashkenazi said Eli Lilly has several manufacturing sites either under construction or “ramping up,” including two locations in North Carolina, two in Indiana, one in Ireland and one in Germany, along with a seventh site the company recently acquired from Nexus Pharmaceuticals. Eli Lilly late last month also said it would invest another $5.3 billion in its manufacturing plant in Lebanon, Indiana. 
Those facilities add to the company’s “existing, very large” manufacturing footprint across the U.S. and Europe, Ashkenazi said. Since 2020, Eli Lilly has spent more than $18 billion to build, expand and purchase manufacturing plants in those regions, the company said in May.
Ashkenazi noted that Eli Lilly is also tackling another barrier to patient access: limited insurance coverage for weight loss drugs in the U.S. 
Some employers and other health plans are still reluctant to cover GLP-1s for weight loss due to their hefty price tags, which they say could significantly strain their budgets. Insurers also have other questions, such as how long patients actually stay on the treatments. 
Still, Ashkenazi said coverage of Zepbound by U.S. commercial insurers is improving, with about 67% commercial coverage as of April 1. Eli Lilly is working to build that access for the remainder of the patients, she noted. 
“It’s not enough to have a highly efficacious, safe drug that can truly change people’s healthcare – but also make it accessible,” Ashkenazi said. 
She also hopes that patients enrolled in the federal Medicare program will eventually see increased coverage for weight loss drugs as Eli Lilly and other drugmakers demonstrate their ability to treat a wide range of obesity-related conditions. 
Eli Lilly is studying tirzepatide, the active ingredient in Zepbound and Mounjaro, in patients with obesity and fatty liver disease, obstructive sleep apnea, chronic kidney disease and heart failure, among other health conditions. 
Under new guidance issued in March, Medicare Part D plans can cover obesity treatments that receive regulatory approval for an additional health benefit. Medicare prescription drug plans administered by private insurers, known as Part D, currently cannot cover those drugs for weight loss alone.
A bigger issue at hand is a long-held misconception that obesity is a “lifestyle choice” rather than a chronic disease, according to Ashkenazi.
Eli Lilly is trying to change that. 
“Our goal is to ensure that society, the health-care system and patients themselves actually view this and understand that it is a chronic disease…and therefore should be treated as such,” Ashkenazi said.  More