Mounjaro Skips PBS Listing for Type 2 Diabetes

Eli Lilly Australia

Key Facts:

· A positive PBS funding recommendation came with unviable and unsustainable conditions¹ that Lilly cannot accept

· Mounjaro is designated by the WHO as an Essential Medicine for type 2 diabetes² and is already reimbursed for type 2 diabetes in 11 countries – including the UK and countries with larger populations and lower GDP per capita than Australia, such as China³

· Without wholesale changes to the PBS, Australia will further entrench a two‑tier system where medicines access depends on a person's ability to pay

Friday 24 April: Eli Lilly Australia (Lilly) regretfully advises that Mounjaro will not become available through the Pharmaceutical Benefits Scheme (PBS) for Australians living with type 2 diabetes, following four unsuccessful attempts to secure a viable funding recommendation.

While the Pharmaceutical Benefits Advisory Committee (PBAC) has finally recommended that Mounjaro be made available through the PBS and acknowledged the clinical value of the medicine,¹Lilly cannot proceed with the listing under the proposed conditions.

"We do not make this decision lightly. After four reimbursement submissions and extensive departmental engagement over three years, we were left with no other option," said Manny Simons, General Manager of Lilly Australia and New Zealand.

"We understand how disappointing this will be for up to 450,000 Australians living with type 2 diabetes who should have access to Mounjaro through the PBS."³

The World Health Organization lists Mounjaro as an Essential Medicine for type 2 diabetes based on clinical evidence and unmet medical need.²

Australia continues to undervalue medical innovation by comparing modern medicines with older, low-cost therapies and insisting on rigid expenditure caps. The result is that while Australia was one of the first countries where Mounjaro was launched, 11 other countries now fund the therapy and Australians miss out.³

Why the PBS listing of Mounjaro for type 2 diabetes will not proceed^1,2

The price that the Australian Government is willing to pay for Mounjaro is significantly lower than any other reimbursed price globally – including comparable healthcare systems like the UK and countries with lower GDP per capita, such as China.
The recommendation included strict funding caps that would have assigned disproportionate financial risk to Lilly. The PBAC rejected proposed safeguards to restrict prescribing only to eligible patients, meaning Lilly would have to pay for the treatment of other patients.
The value of Mounjaro was ultimately price benchmarked against a medicine that is 20 years old, is no longer available in Australia and involves 14 times as many injections.
Under existing policies, a significant share of the proposed expenditure on Mounjaro would flow to wholesalers and pharmacies rather than to Lilly, making long‑term supply through the PBS unsustainable.

Diabetes experts concerned by chronic undervaluing of medical innovation

Associate Professor Sof Andrikopoulos, CEO of the Australian Diabetes Society, said, "Australians living with type 2 diabetes are being penalised by the chronic undervaluing of medical innovation." "Type 2 diabetes is the single greatest challenge facing Australia's health system. In spite of significant advancements in treatment, over 850,000 Australians living with this condition have inadequately managed blood glucose levels.^4,5

^"The Australian Diabetes Society supports individualised care for people with diabetes and choice for health professionals, but bureaucratic inflexibility is now impeding access to therapies which effectively manage their condition and reduce the risk of diabetes-related complications."

Lilly notes that approximately 100 positive PBAC recommendations have not progressed to PBS listings over the past five years.⁶

Mr Simons said, "Our decision was driven by the simple reality that the price conditions proposed by the Australian Government are unrealistic and unviable, independent of global pricing dynamics influenced by the US Administration's Most-Favoured-Nation policy."

"Health stakeholders know that Australia's medicines access system is in a state of disrepair. They also know that a fix is within reach if the Federal Government fully implements the recommendations of the Health Technology Assessment review and matches these reforms with a substantial increase in budget allocated to innovative medicines."

"While the door to a PBS listing for type 2 diabetes is now shut, we remain focused on finding new ways to make Mounjaro more accessible for Australians with chronic cardiometabolic conditions – including working with the Government on potential solutions outside of the PBS."

What does this mean for people living with obesity?

While Lilly's decision is specific to type 2 diabetes, systematic barriers to equitable medicines access in Australia are likely to impede future reimbursement submissions for other Mounjaro indications – including the treatment of obesity.

"Based on today's outcome, it is difficult to see how a PBS listing for Mounjaro could be secured for Australians living with obesity or obesity-related disease," Mr Simons said.

"Lilly would like to thank the diabetes community for their vocal support of equitable access to Mounjaro in Australia."

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