Fifth Circuit record puts Lilly's shortage-era capacity spending at about $23 billion

The U.S. Court of Appeals for the Fifth Circuit, ruling on August 27, 2026, upheld the FDA's decision to remove Mounjaro and Zepbound from its drug shortage list, and the court's opinion put a number on what it took to get there: Eli Lilly spent roughly $23 billion building, expanding and acquiring manufacturing capacity in the United States and Europe while the tirzepatide drugs sat on the shortage list ^[1][2].

The case, Outsourcing Facilities Association v. FDA, was brought by compounding pharmacy groups challenging the FDA's October 2024 determination, later confirmed in December 2024, that supply of tirzepatide injection products would "meet or exceed projected demand" ^[1]. The compounders argued the FDA should have used formal notice-and-comment rulemaking and that its shortage decision was arbitrary and capricious. The three-judge panel rejected both arguments and affirmed a lower court ruling in favor of the FDA and Lilly ^[1][2].

Along with the manufacturing spending, the opinion notes Lilly also won FDA approval to sell single-dose vials of Mounjaro and Zepbound in addition to the original single-dose injection pens ^[1]. The court's record shows Mounjaro was added to the shortage list in December 2022 and Zepbound in April 2024, before both were delisted in late 2024 ^[1][2]. A companion opinion issued the same day, covering Novo Nordisk's Ozempic and Wegovy, was affirmed "for the same reasons" ^[2].

The opinion also states that Lilly's exclusivity for tirzepatide as a new chemical entity, which bars the FDA from approving competing tirzepatide products, runs to 2027 ^[1]. Both rulings were issued unpublished, meaning under Fifth Circuit Rule 47.5 they are not binding precedent, though the compounders lost decisively on the merits ^[2].

Why it matters for patients

For people who have been getting compounded tirzepatide or semaglutide from pharmacies or outsourcing facilities relying on the shortage exception, this ruling closes off the legal argument that the FDA acted improperly in ending that exception ^[1][2]. The federal law that let compounders make copies of Mounjaro and Zepbound during the shortage no longer applies now that the FDA has found supply adequate, and that finding has now survived a full court challenge ^[1].

Patient-specific compounding, where a pharmacy fills an individual prescription for a documented clinical reason the approved product cannot meet, is a separate legal pathway not addressed by this narrow procedural ruling in the same way as shortage-based bulk compounding ^[2]. What changes for patients depends heavily on which pathway a given telehealth program or pharmacy has been using, and that is not something this court record settles for any individual patient.

The $23 billion figure also underscores how much manufacturing investment underlies the current, more stable tirzepatide supply. Whether that translates into lower or more predictable prices for patients paying out of pocket is not addressed in the court's opinion ^[1].

What happens next

The compounding groups could seek rehearing en banc or ask the U.S. Supreme Court to review the decision, though the court record does not indicate any such filing has occurred ^[1]. Lilly's five-year tirzepatide exclusivity is set to run to 2027, after which the legal landscape for competing tirzepatide products could change ^[1]. The statutory shortage list itself is not static — the law defines a shortage as any period when demand or projected demand exceeds supply, meaning a future shortage determination could again suspend the compounding restrictions, though nothing in the current record suggests that is happening now ^[1].