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CVS Health is pulling Amgen's Prolia and Eli Lilly's Forteo from its commercial formularies, replacing both branded bone drugs with lower-cost biosimilar alternatives. CVS Health announced it will remove Amgen's Prolia and Eli Lilly's Forteo from its commercial formularies, a decision that creates direct revenue headwinds for both pharma giants.
The move is significant in scope and timing. Prolia (denosumab) ranks among Amgen's largest revenue contributors, treating osteoporosis in postmenopausal women and certain cancer patients. Forteo (teriparatide) has been a steady earner in Lilly's specialty portfolio. CVS's Caremark unit manages drug benefits for tens of millions of Americans, so losing preferred formulary status there translates quickly into volume loss and pricing pressure.
How Formulary Exclusions Work Against Branded Drugs
When a major PBM drops a branded drug from its preferred tier, the consequences stack fast. Patients face higher out-of-pocket costs for the branded version, which nudges both prescribers and patients toward the biosimilar. In therapeutic areas where biosimilars have demonstrated clinical equivalence, as they have in osteoporosis, the switching dynamic tends to be swift.
For Amgen, the timing is especially sensitive. The company spent years defending Prolia's market position as biosimilar competitors gained FDA approval. A CVS formulary exclusion signals that the pricing umbrella Prolia has historically enjoyed may be collapsing faster than consensus models assumed. If other large PBMs follow CVS's lead, the biosimilar erosion timeline could accelerate well beyond current sell-side estimates.
Lilly's Forteo exposure is comparatively smaller. The drug has faced generic and biosimilar competition for several years already. Even so, the formulary action reinforces a broader theme: branded specialty drugs without meaningful clinical differentiation face mounting cost-containment pressure.
Who Benefits
Biosimilar manufacturers with approved denosumab and teriparatide products are positioned to capture volume from CVS's commercial book of business. CVS did not name specific biosimilar products in its announcement.
CVS itself gains through lower drug spend, which is a direct selling point for the employer and health plan clients that contract with Caremark. As PBMs face intensifying regulatory scrutiny, demonstrating concrete cost savings through formulary management gives CVS a useful narrative with both clients and policymakers.
What This Means for AMGN and LLY
Amgen carries the higher near-term exposure here. Management has guided for gradual biosimilar share loss on Prolia, but an accelerating formulary exclusion cycle could pull that erosion forward meaningfully. In the opinion of many analysts, the key variable to watch is whether United Health's Optum Rx or Express Scripts follow CVS's move. Upcoming earnings calls may offer updated volume guidance on Prolia trends.
Eli Lilly's core bull case today rests heavily on its GLP-1 franchise through Mounjaro and Zepbound, plus its oncology pipeline. Forteo is a shrinking slice of the revenue mix, so the direct financial hit is more modest. The formulary action still serves as a reminder that Lilly's older specialty assets face structural headwinds.
The Bigger PBM Picture
This move fits a clear industry pattern. PBMs have grown more aggressive on biosimilar substitution as the product pipeline has matured and employer clients push harder on specialty drug costs. The Inflation Reduction Act's downstream pressure on drug pricing has also given PBMs additional leverage in formulary negotiations.
Neither Amgen nor Lilly faces a crisis from this single formulary action. But the direction of travel is clear. CVS is rarely the last major PBM to move, and branded pharma companies have learned that formulary access can erode faster than model assumptions suggest.