PepsiCo to drop weight-loss drug coverage for some employees in October

PepsiCo has told some employees that its health insurance will stop covering prescription weight-loss drugs beginning in October 2026, Bloomberg News reported on Aug. 25, 2026 ^[1].

The notices went to part of the workforce during the week of Aug. 24, according to an internal email reviewed by Bloomberg. The message gave cost as the reason, describing the medications as one of the "fastest-growing costs" in PepsiCo's plans and saying the change would help keep the health program affordable for employees overall ^[1].

PepsiCo has not said how many workers received the notice, which medicines its plan had been paying for, how much it spent on them, or whether another benefit will take their place ^[1]. Nor has it been reported whether the change applies to every PepsiCo health plan or only to the group that got the email ^[1].

Six days later, Eli Lilly chief executive David Ricks offered his own reading of the trend. In a CNBC interview on Aug. 31, 2026, he said employer decisions are running about even. "Right now it's about neutral," he said, adding that while dropped coverage draws attention, there "are adds as well" ^[2]. He did not provide figures ^[2].

Ricks also disputed the logic behind PepsiCo's move. He said employers carry obesity-related costs either way, through heart attacks, diabetes and other conditions, so paying for treatment is the better approach ^[2]. The argument comes from the head of a company that sells obesity medicines, and he cited no data for it ^[2].

Ricks spoke the same morning Lilly announced it would buy Merida Biosciences for up to $2.875 billion in cash. Merida is developing biologics that break down harmful autoantibodies rather than broadly suppressing the immune system, with an early-stage lead program for Graves' disease and thyroid eye disease ^[2]. Ricks said Lilly has completed more deals in 2026 than in all of last year, a pace funded in part by its obesity business ^[2].

Why it matters for patients

For anyone whose drug coverage comes through an employer, the decision that counts is made at the plan level, not by a doctor or a pharmacy. PepsiCo's email shows those calls are being made company by company, and that at least one large US employer concluded the medications cost more than it wanted to keep paying ^[1].

What affected workers will owe after October has not been reported, and it is not known whether they could obtain the drugs another way or challenge the change ^[1]. The reporting does not name which products were removed from the plan ^[1].

Ricks' counter-argument — that obesity costs land on employer books whether or not the drugs are covered — is likely to be repeated as other companies weigh the same choice. Whether it changes what employers decide has not been established ^[2].

What happens next

Coverage ends in October 2026, according to the notice sent to employees ^[1]. Whether other large employers will follow PepsiCo has not been reported ^[1]. Ricks said additions and removals are roughly balanced across employers, but he gave no figures ^[2].