Direct GLP-1 prescriptions are Walmart, Costco, Amazon weight-loss win

As more Americans use GLP-1 weight-loss drugs to shrink their waistlines, retail giants are betting on a bottom-line bump tied to a shift in the way the drugs are priced and purchased. Employers are dropping coverage for GLP-1 drugs like Wegovy and Zepbound in greater numbers, nudging more patients to direct-to-consumer prescription programs, and providing Walmart, Costco, CVS and Amazon the opportunity to gain a greater share of the market.

For the retail pharmacy chains, a GLP-1 prescription is evolving into more than a simple sale — it’s creating a beachhead to developing customer relationships that can run for years and pull shoppers toward everything else on the shelf. If a customer is going to get their GLP-1s from Walmart, they might as well get all their other prescriptions and load up on deodorant, paper towels, and condiments. 

“Retailers are betting that if they can become the front door for obesity care, they’ll earn a relationship that extends far beyond a single GLP-1 prescription,” said Eric Bormel, managing director specializing in digital healthcare at Solomon Partners’ healthcare group.

The DTC GLP-1 programs are customer acquisition tools, Bormel said, and retailers are increasingly valuing the entire ecosystem around the medication more than the medication itself, which is experiencing downward price pressure.  

“Everyone recognizes that obesity treatment is becoming a longitudinal consumer relationship,” Bormel said, noting that retailers aren’t simply fighting over the same customers, but bringing in new ones through the GLP-1 business. It’s one of the business tailwinds that is in stark contrast to initial concerns that GLP-1s were a headwind for retailers as consumers cut back on impulse buys and overall grocery spending.

New clothing needs is one way that retailers stand to benefit from GLP-1 usage. But the need for prescription refills fits into an even broader strategy for large retail pharmacy networks that have been betting the weight-loss drug boom, even at low margins, will pay off for their businesses. 

“In a retail industry that spends billions chasing foot traffic, that is the most reliable recurring customer relationship on the market,” said Jackie Swanson, managing partner at Gartner Consulting.

The prescription refill is a retail one-of-a-kind

Walmart becoming the retail pickup point for LillyDirect matters because the patient who collects a prescription walks through the store to reach it. “Pharmacy lock-in is loyalty-program economics applied to medicine, and it works because the refill, unlike almost everything else in retail, is non-negotiable,” Swanson said. 

She notes LillyDirect’s cash prices, which run $299 to $449 a month, with the better pricing tied to refilling within 45 days. “Which is a loyalty program dressed as a discount schedule,” Swanson said.

Novo Nordisk’s…