Eli Lilly's obesity drug Zepbound can now be covered by government-backed Medicare insurance plans for use in sleep apnea, broadening access to the blockbuster weight-loss treatment. The Wednesday statement from the Centers for Medicare & Medicaid Services comes after Zepbound in December became the first drug approved in the U.

Zepbound is not covered by Medicare or many other insurance plans as a treatment for weight loss. The injectable treatment costs about $1,000 a month without insurance.

Medicare now covers Eli Lilly's Zepbound for obstructive sleep apnea, FDA-approved for obesity and sleep apnea treatment, reducing apnea events by 62.8%.

The United States Food and Drug Administration says the shortage of Eli Lilly’s Zepbound and Mounjaro drugs has been resolved and that specialty pharmacies and online companies need to stop selling off-brand versions of the weight-loss drugs. The FDA has issued warnings against the off-brand versions, citing safety concerns.

The agency’s decision expands the use of Zepbound and could potentially pave the way for Eli Lilly to gain broader insurance coverage for the treatment.

According to BMO Capital Markets, Medicare coverage of Lilly’s Zepbound opens the door to using secondary indications to secure CMS coverage for obesity drugs.

The FDA on Friday approved Eli Lilly's weight-loss drug Zepbound as a treatment for moderate-to-severe sleep apnea and obesity.

Both Novo Nordisk and Eli Lilly are studying their weight loss drugs to treat fatty liver disease, chronic kidney disease, sleep apnea and more. To be covered, these drugs would need to have late-stage trial results and then seek FDA approval for these uses.