GLP-1 Compounding Ban: What Happened & What's Next

For roughly three years, millions of Americans accessed compounded semaglutide — a fraction of the cost of brand-name Ozempic or Wegovy — through compounding pharmacies that filled a gap the drug manufacturers couldn't. The FDA declared a semaglutide shortage. Compounders stepped in. Patients got affordable medication. Everyone seemed to benefit.

Then, in February 2025, the FDA declared the shortage over. And everything changed.

This article traces the full timeline of the GLP-1 compounding saga: how the shortage began, how compounders built a billion-dollar market in the gap, why the FDA shut it down, and what options remain for patients who can't afford $1,000+ per month for brand-name GLP-1 drugs.

The GLP-1 Drug Shortage: How It Started
How Compounding Pharmacies Filled the Gap
The FDA Ends the Shortage — And the Compounding Window
Timeline of Key Events
The Lawsuits: OFA vs. FDA
Novo Nordisk and Eli Lilly Fight Back
503A vs. 503B: Different Deadlines, Same Outcome
FDA Warning Letters and Enforcement
Safety Concerns With Compounded GLP-1s
What Patients Can Do Now
What Comes Next
FAQ
The Bottom Line
References

The GLP-1 Drug Shortage: How It Started

Semaglutide and tirzepatide became the fastest-growing drug class in pharmaceutical history. Novo Nordisk's semaglutide products (Ozempic for diabetes, Wegovy for weight management) and Eli Lilly's tirzepatide products (Mounjaro for diabetes, Zepbound for weight loss) generated combined revenue exceeding $40 billion in 2024.

Demand vastly outpaced supply. The FDA added semaglutide products to its Drug Shortages list in March 2022 (Wegovy) and August 2022 (Ozempic). Tirzepatide followed.

The shortage was real. Patients with valid prescriptions couldn't fill them. Insurance authorization processes took weeks. And for the millions of people without insurance coverage for weight loss medications, brand-name pricing — approaching or exceeding $1,000 per month — put these drugs out of reach entirely.

How Compounding Pharmacies Filled the Gap

Under the Federal Food, Drug, and Cosmetic Act, compounding pharmacies have a specific legal window: when a drug is on the FDA's shortage list, compounders can prepare versions of that drug to address the unmet patient need. This applies to both 503A pharmacies (state-licensed, patient-specific) and 503B outsourcing facilities (federally registered, batch production).

Compounders saw the opportunity clearly. The raw ingredient cost for a month's supply of semaglutide was estimated at less than $5. Compounders could sell to patients for $100 to $300 per month — a massive discount from brand-name pricing — and still earn significant margins.

The market grew rapidly. Telehealth platforms partnered with compounding pharmacies. Medspa chains added compounded semaglutide to their service menus. Direct-to-consumer companies like Hims & Hers built GLP-1 programs around compounded products.

At peak, the compounded semaglutide market was estimated to serve millions of patients — many of whom had never been able to access these medications through traditional channels.

The FDA Ends the Shortage — And the Compounding Window

Tirzepatide First

The FDA initially removed tirzepatide from the drug shortage list in October 2024, after Eli Lilly reported it could meet market demand. The Outsourcing Facilities Association (OFA) — a trade group representing 503B compounders — immediately sued, arguing the FDA's determination was premature.

A federal court temporarily halted the removal, but in December 2024, the FDA again determined the tirzepatide shortage was resolved.

Then Semaglutide

On February 21, 2025, the FDA issued a Declaratory Order: the semaglutide shortage was officially resolved. Novo Nordisk had ramped up manufacturing capacity, and the agency determined that supply now met demand for all approved dosage forms.

This single decision triggered a cascade of deadlines, lawsuits, and enforcement actions that reshaped the GLP-1 market overnight.

Timeline of Key Events

Date	Event
March 2022	FDA adds Wegovy (semaglutide) to Drug Shortages list
August 2022	FDA adds Ozempic (semaglutide) to Drug Shortages list
2022-2024	Compounded semaglutide market grows rapidly through telehealth and medspa channels
October 2024	FDA initially removes tirzepatide from shortage list; OFA sues
December 2024	FDA reaffirms tirzepatide shortage is resolved
February 21, 2025	FDA declares semaglutide shortage resolved
February 24, 2025	OFA files lawsuit against FDA over semaglutide shortage determination
March 5, 2025	Court denies OFA preliminary injunction on tirzepatide; 503A compounders must stop immediately
March 19, 2025	Deadline for 503B facilities to stop compounding tirzepatide
April 22, 2025	Deadline for 503A pharmacies to stop compounding semaglutide
April 24, 2025	Court denies OFA preliminary injunction on semaglutide
May 7, 2025	Court upholds FDA's tirzepatide shortage determination
May 22, 2025	Deadline for 503B facilities to stop compounding semaglutide
April-July 2025	Eli Lilly files lawsuits against compounders, including Empower Pharmacy
August 2025	Novo Nordisk sues 12 defendants, including pharmacies
September 2025	FDA issues 50+ warning letters to GLP-1 compounders and manufacturers
February 2026	FDA announces expanded enforcement intent against non-approved GLP-1 products

The Lawsuits: OFA vs. FDA

The Outsourcing Facilities Association didn't accept the FDA's shortage determinations without a fight. Their legal strategy challenged both the tirzepatide and semaglutide decisions.

The Core Argument

OFA argued that the FDA's shortage determinations were "arbitrary and capricious" — the legal standard for overturning agency decisions. Their position: the FDA hadn't adequately accounted for the millions of patients who would lose access to affordable GLP-1 medications when compounding stopped. Supply might meet demand at $1,000 per month, they argued, but not at prices patients could actually afford.

How the Courts Ruled

The courts sided with the FDA. On March 5, 2025, a U.S. District Court judge denied OFA's request for a preliminary injunction on tirzepatide. On April 24, 2025, the same outcome for semaglutide. On May 7, 2025, the court issued a full ruling upholding the FDA's tirzepatide determination, finding the agency acted within its statutory authority.

The courts emphasized that the FDA's Drug Shortage List tracks manufacturing capacity versus demand for approved dosage forms — not whether patients can afford the brand-name product. Affordability, the courts found, isn't part of the shortage analysis.

This was devastating for compounders. Without a preliminary injunction, the enforcement deadlines stood. Pharmacies had to stop producing compounded semaglutide and tirzepatide on schedule.

Novo Nordisk and Eli Lilly Fight Back

The brand-name manufacturers didn't rely solely on the FDA to protect their market. They launched aggressive litigation campaigns against compounders.

Eli Lilly's Approach

Eli Lilly filed its first major lawsuit against Empower Pharmacy (one of the largest 503B compounders) in the District of New Jersey in April 2025, alleging a "nationwide scheme to sell its untested products by misleading consumers." A second lawsuit followed in July 2025 in the Southern District of Texas.

Eli Lilly also pursued Alderwood Surgical Center in Washington state on false advertising claims. That case is scheduled for trial in March 2026.

Novo Nordisk's Escalation

Novo Nordisk escalated in August 2025, filing lawsuits against 12 defendants, including several pharmacies — a strategic shift from its earlier focus on telehealth platforms and suppliers. The company alleged trademark infringement, false advertising, and violations of the FD&C Act.

A particularly high-profile action targeted Hims & Hers, which had built a substantial business around compounded semaglutide. Novo Nordisk's lawsuit alleged the company marketed compounded products as equivalent to Ozempic and Wegovy — claims the FDA has explicitly said are false and misleading.

The Legal Theory

Both companies argue that compounded versions of their drugs are:

"Essentially copies" of commercially available products — which compounders are prohibited from making when the drug isn't in shortage
False and misleading when marketed as "generic" versions or as having the "same active ingredient" with equivalent safety and efficacy
Trademark violations when they reference Ozempic, Wegovy, Mounjaro, or Zepbound in marketing materials

If these lawsuits succeed, they'll set precedents that extend well beyond GLP-1 drugs — potentially limiting compounding pharmacy operations across all medication categories.

503A vs. 503B: Different Deadlines, Same Outcome

The enforcement deadlines differed based on pharmacy type, but the end result was the same. For a deeper explanation of how these pharmacy designations work, see our 503A vs. 503B compounding guide.

503A Pharmacies (State-Licensed)

These are traditional compounding pharmacies that fill patient-specific prescriptions. Under section 503A of the FD&C Act, they can compound drugs based on individual prescriptions from licensed practitioners.

Semaglutide deadline: April 22, 2025 Tirzepatide deadline: Immediate (enforcement discretion had already expired)

503B Outsourcing Facilities (Federally Registered)

These are larger-scale operations that can compound batches of drugs without patient-specific prescriptions. They face stricter manufacturing requirements (CGMP compliance) and regular FDA inspection.

Semaglutide deadline: May 22, 2025 Tirzepatide deadline: March 19, 2025

The 503B facilities received slightly longer wind-down periods because their operations are more complex to dismantle — they may have had inventory in production, orders in transit, and contracts with healthcare providers that needed orderly termination.

The "Not Essentially a Copy" Exception

One narrow pathway remains. The law prohibits compounders from making drugs that are "essentially copies" of commercially available products. But the definition of "essentially a copy" has some flexibility. If a compounder creates a formulation at a dose or in a form that isn't commercially available — and a prescriber documents a specific clinical need for that non-standard formulation — some legal commentators argue compounding may continue.

In practice, this exception is narrow. The FDA has signaled it will scrutinize any claimed "clinical need" for non-standard formulations, and brand manufacturers are watching closely.

FDA Warning Letters and Enforcement

In September 2025, the FDA (working with HHS) issued more than 50 warning letters to U.S. and international companies involved in compounding or manufacturing GLP-1 drugs.

The letters targeted:

Compounding pharmacies still producing semaglutide or tirzepatide after enforcement deadlines
Telehealth platforms marketing compounded GLP-1 products
Bulk manufacturers supplying semaglutide API to compounders
International companies selling unapproved GLP-1 products into the U.S. market

Key claims in the warning letters:

Companies cannot claim their compounded products are "generic" versions of approved drugs
Companies cannot claim their products use the "same active ingredient" or produce the "same clinical results"
Marketing compounded GLP-1 drugs as equivalent to FDA-approved versions is false and misleading
Compounded GLP-1 products that haven't undergone FDA review are unapproved new drugs

The FDA also flagged concerns about fraudulent products — semaglutide and tirzepatide labeled with fake pharmacy names or the names of licensed pharmacies that didn't actually compound the product.

In February 2026, the FDA publicly stated its intent to take broader action against non-FDA-approved GLP-1 drugs. Importantly, the agency distinguished between illegal mass production and legitimate patient-specific compounding by state-licensed pharmacies. The enforcement priorities are:

Compounding without documented medical necessity
Unlicensed manufacturing
Misleading marketing
Improper storage and handling

DOJ involvement has been confirmed, signaling potential criminal prosecution for the most egregious violations.

Safety Concerns With Compounded GLP-1s

The FDA's enforcement isn't purely about market protection. Real safety issues drove the crackdown.

Adverse Event Reports

As of February 28, 2025, the FDA had received:

455+ adverse event reports with compounded semaglutide
320+ adverse event reports with compounded tirzepatide

Many of these reports involved dosing errors. Compounded semaglutide was often supplied in multi-dose vials requiring patients to measure and draw up their own doses — unlike the pre-filled, dose-specific pens that Novo Nordisk and Eli Lilly provide. Measuring errors led to patients injecting incorrect (often excessive) amounts.

Some adverse events required hospitalization.

Manufacturing Quality

Not all compounders are equal. While well-run 503B outsourcing facilities operate under CGMP standards with sterility testing and quality controls, the rapid growth of the compounded GLP-1 market attracted operators with less rigorous practices. Concerns included:

Inconsistent potency between batches
Contamination risks from non-sterile compounding environments
Salt form differences (some compounders used semaglutide sodium instead of the base form, raising bioequivalence questions)
Lack of stability data for compounded formulations

Counterfeits

Perhaps the most alarming development: counterfeit GLP-1 products entering the supply chain. The FDA identified products labeled as compounded semaglutide that were manufactured by unlicensed facilities, sometimes overseas, with no quality controls whatsoever.

What Patients Can Do Now

If you were using compounded semaglutide or tirzepatide and lost access, you're not without options — though none of them are as cheap as compounding was.

1. Brand-Name With Insurance

If your insurance covers GLP-1 medications (many now do, especially for diabetes), the brand-name products are the most straightforward option. Coverage has expanded significantly since 2023, particularly for semaglutide (both Ozempic for diabetes and Wegovy for weight management).

Check your plan's formulary. Some insurers that previously excluded weight-loss medications have added coverage in 2025-2026, partly due to growing evidence that GLP-1 drugs reduce cardiovascular events and healthcare costs.

2. Manufacturer Savings Programs

Both Novo Nordisk and Eli Lilly offer savings programs:

Novo Nordisk: Patient assistance programs for qualifying uninsured or underinsured patients
Eli Lilly: Zepbound savings cards and assistance programs

These programs have eligibility requirements and typically don't cover everyone, but they're worth checking.

3. Non-Standard Dose Compounding (Narrow Exception)

As mentioned above, the "not essentially a copy" exception may allow compounding of non-standard formulations. If your prescriber can document a specific clinical need for a dose or form that isn't commercially available, a compounding pharmacy may be able to prepare it. This is a narrow exception that requires genuine medical justification — not just cost savings.

4. Other FDA-Approved GLP-1 Options

Semaglutide and tirzepatide aren't the only GLP-1 medications:

Liraglutide (Saxenda) — FDA-approved for weight management, available as a generic-equivalent biosimilar in some markets
Oral semaglutide (Rybelsus) — Tablet form, different pricing structure than injectable
Tirzepatide — Available in multiple dose forms; insurance coverage may differ from semaglutide

5. Talk to Your Doctor

Your physician can help navigate the current options and may know about patient assistance programs, clinical trials, or alternative approaches. Our guide on how to talk to your doctor about peptides can help structure that conversation.

What Comes Next

The GLP-1 compounding story isn't over. Several developments will shape the next chapter:

Ongoing Litigation

Multiple cases remain active:

OFA vs. FDA challenges to shortage determinations (appeals possible)
Eli Lilly vs. Alderwood Surgical Center (trial scheduled March 2026)
Novo Nordisk vs. Hims & Hers and other compounders
Various compounding pharmacies challenging FDA warning letters

The outcomes of these cases will define the boundaries of compounding law for years to come.

Patent Expiration

Novo Nordisk's primary semaglutide patent expires in 2031 in the United States, with secondary patents potentially extending protection to 2033 or beyond. But the patent expires in Canada and China in 2026 — meaning generic semaglutide could be available outside the U.S. sooner.

When patents expire, generic manufacturers can produce semaglutide (or biosimilar versions, depending on regulatory classification), which should drive prices down substantially.

Legislative Action

Some members of Congress have proposed legislation to:

Require the FDA to consider affordability in shortage determinations
Protect compounding access for medications above a certain price threshold
Increase transparency in drug pricing

Whether any of these proposals advance remains to be seen, but the political pressure is real. Millions of voters lost access to affordable GLP-1 medications, and elected officials have noticed.

Novo Nordisk Pricing Adjustments

Under growing public and political pressure, Novo Nordisk has made some pricing adjustments. Any further price reductions could change the calculus for patients and regulators. If the brand-name price drops enough, some of the political pressure around compounding access may ease.

FAQ

Is compounded semaglutide still available anywhere?

In general, no — not legally. The enforcement discretion periods for both 503A and 503B facilities have ended. The narrow exception for "not essentially a copy" formulations may allow some non-standard-dose compounding with documented medical necessity, but this is not widely available and is under scrutiny.

Why did the FDA declare the shortage over?

The FDA determined that Novo Nordisk's manufacturing capacity could meet market demand for all approved semaglutide dosage forms. The shortage designation tracks manufacturing supply versus prescribing demand — it does not consider whether patients can afford the product.

Can I still use compounded semaglutide I already have?

The FDA enforcement actions target compounders, not individual patients. If you have remaining supply from a prescription filled before the deadline, using it isn't a federal crime. But getting a refill after the deadline is a different matter — your pharmacy likely can't fill it.

How much more expensive is brand-name semaglutide?

Brand-name Wegovy lists at approximately $1,350 per month. Brand-name Ozempic is roughly similar. Compounded semaglutide typically ranged from $100 to $300 per month. The price gap is significant, though insurance coverage and manufacturer programs can reduce out-of-pocket costs.

Did the compounding ban affect tirzepatide too?

Yes. Tirzepatide (Mounjaro, Zepbound) was actually removed from the shortage list before semaglutide. The enforcement timelines for tirzepatide compounding ended in early to mid-March 2025. The legal and regulatory dynamics are essentially identical.

Will generic semaglutide be available in the U.S.?

Not in the near term. Novo Nordisk's U.S. patents extend to at least 2031. However, generic or biosimilar semaglutide may become available in Canada and China as early as 2026, when certain patents expire in those jurisdictions.

The Bottom Line

The GLP-1 compounding ban is, at its core, a collision between drug pricing, patent law, pharmaceutical regulation, and patient access. Compounding pharmacies provided affordable GLP-1 medications to millions of people during a genuine shortage. When the FDA declared that shortage over, the legal basis for compounding evaporated — regardless of whether the underlying affordability problem was solved.

The courts have consistently upheld the FDA's authority to make shortage determinations. Brand-name manufacturers have aggressively litigated to protect their market. And patients are caught between a regulatory system designed to ensure safety and a pricing system that limits access.

What happens next depends on litigation outcomes, patent timelines, potential legislation, and manufacturer pricing decisions. In the meantime, the most productive step for anyone affected is working with a physician to find the best available option — whether that's an FDA-approved GLP-1 through insurance, a manufacturer savings program, or an alternative therapeutic approach.

For the broader context on how peptide compounding regulations work, see our guide on FDA peptide compounding rules and the complete 2025-2026 regulatory timeline.

References

U.S. Food and Drug Administration. "FDA's Concerns with Unapproved GLP-1 Drugs Used for Weight Loss." FDA.gov
Foley & Lardner LLP. "GLP-1 Drugs: FDA Removes Semaglutide from the Drug Shortage List." Foley.com
Buchanan Ingersoll & Rooney. "Major Update on GLP-1 Litigation Involving Compounding Pharmacies." BIPC.com
Buchanan Ingersoll & Rooney. "Oral Semaglutide and the GLP-1 Compounding Reckoning." BIPC.com
Spencer Fane. "Beyond the Headlines: FDA Warning Letters to GLP-1 Compounders." SpencerFane.com
Harris Beach Murtha. "GLP-1 Weight-Loss Drugs Off Shortage List; Deadlines to Stop Compounding." HarrisBeachMurtha.com
McDermott Will & Emery. "Court Backs FDA in Tirzepatide Compounding Case." MWE.com
Pharmacy Times. "Out of Shortage, Into Controversy: The Fight Over GLP-1 Compounding." PharmacyTimes.com
Wilson Sonsini. "FDA Sends Warning Letters to More Than 50 GLP-1 Compounders and Manufacturers." WSGR.com
GoodRx. "Is There a Semaglutide Shortage?" GoodRx.com

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