Chinese Drugmakers Flooded US With Wegovy Copy Ingredients - Now They Are Pivoting To Generics: Report

Chinese pharmaceutical companies that once supplied ingredients for more than a billion makeshift doses of weight-loss drugs in the U.S. are apparently shifting their focus to generics as regulators crack down on compounded copies of Novo Nordisk's Wegovy and Eli Lilly's Zepbound.

Over the past two years, at least eight Chinese firms,  including Jiangsu Sinopep-Allsino Biopharmaceutical and Hybio Pharmaceutical, shipped raw semaglutide and tirzepatide to the U.S., according to Reuters' report, citing FDA shipping data and public records. 

Sinopep and Hybio are now reportedly working to develop generic semaglutide, while Nanjing Hanxin Pharmaceutical and Fujian Genohope Biotech may follow. 

With U.S. law now restricting compounders to personalized doses or formulations not otherwise available, Chinese suppliers are eyeing markets where Novo's key semaglutide patent is set to expire in 2026, including Canada and Brazil. 

However, producing semaglutide in its final injectable form is complex, and branded drugmakers could delay generic launches, according to a lawyer for a generic drugmaker.

The regulatory shift has already choked supply. In the second quarter of 2025, U.S.-bound shipments of semaglutide and tirzepatide declined by approximately 90% and 34%, respectively, compared to the same quarter a year earlier. That marked a sharp reversal from 2024, when Chinese companies shipped enough semaglutide to make more than one billion starter doses. 

Novo told the U.S. Commerce Department that in just six months, Chinese exporters sent enough to make 1.5 billion Wegovy doses.

The boom began after the FDA declared shortages in 2022, opening the door for compounding pharmacies, often supported by telehealth firms that grew during the pandemic, to sell cheap copies. 

Never before had a new drug become so wildly popular that the manufacturer simply couldn't keep up, said Robert Califf, who has led the FDA twice, calling the compounding surge a“once-in-a-decade” issue.

The economics were compelling. A 2024 JAMA report estimated that the production cost of semaglutide powder was only $0.07 per month, while Chinese suppliers could sell it at up to seven times that amount. 

U.S. compounding pharmacies were then able to offer injections at about $230 a month, which is less than half the price of branded versions.

The fallout has been costly for Novo Nordisk, which missed quarterly sales targets and saw its shares cut in half in 2025, contributing to the ouster of its CEO in May.

As shipments of semaglutide and tirzepatide dry up, some Chinese companies are shifting toward liraglutide, the active ingredient in older Novo drugs Saxenda and Victoza. 

Generic versions of liraglutide have been available in the U.S. since 2024 and are now promoted by telehealth sites that once pushed semaglutide. A wholesale supplier told Reuters he has seen demand for liraglutide climb.

On Stocktwits, retail sentiment was 'extremely bearish' for Novo Nordisk and 'bearish' for Eli Lilly, with both seeing 'extremely low' message volume.

While Novo Nordisk's U.S.-listed stock has declined 33.2% so far in 2025, Eli Lilly's stock dropped 4.2% over the same period.

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