The rise of cash-pay GLP-1 prescriptions, fueled by programs like LillyDirect, is generating plenty of buzz-but JPMorgan analyst Lisa C. Gill isn't convinced this is a major shake-up for the healthcare supply chain.
According to Gill, while Eli Lilly And Co's
LillyDirect's fulfillment model bypasses traditional distributors by shipping straight from Lilly's warehouses via partners like Amazon.com Inc's
That means these sales aren't "lost" volume for distributors-they were never in their lane to begin with. Plus, GLP-1 distribution has never been a major profit driver for pharma distributors, so even if some volume moves from compounding pharmacies to LillyDirect, Gill sees minimal impact on their bottom lines.
The Numbers Tell The Story
LillyDirect's GLP-1 play is still a sliver of the market. Even assuming 5% of 2025's estimated 16.2 million Zepbound prescriptions run through LillyDirect, that's just 800,000 scripts - a drop in the 4.65 billion-prescription U.S. market bucket.
Translation? This isn't a disruption; it's a strategic skirmish.
A Win For Teladoc?
One clear winner in this shake-up could be Teladoc Health Inc
LillyDirect may be making waves, but for pharma distributors, it's business as usual.
As Gill puts it, the GLP-1 cash-pay trend is more about pressuring compounding pharmacies than upending the broader supply chain.
Investors eyeing big disruptions might want to look elsewhere.
