The shortage of drugs like Novo Nordisk A/S' (NYSE:NVO) Ozempic, Wegovy, and Eli Lilly And Co's (NYSE:LLY) Mounjaro and Zepbound have fueled an illicit market of counterfeit and diverted weight loss drugs, revealing an international issue that poses significant health risks.

Last week, the FDA determined the shortage of Eli Lilly tirzepatide injection, a glucagon-like peptide 1 (GLP-1) medication, has been resolved.

Also Read: Eli Lilly Issues Cease-And-Desist Letters to Compounders Over Weight-Loss Drug Copies As Shortage Resolves.

A recent investigation by CNBC unveiled illegal sales and drug diversion, where medications produced for foreign markets are unlawfully shipped to the U.S.

Counterfeit drugs, disguised as popular weight loss medications, have emerged as a growing problem, targeting those seeking affordable alternatives.

CNBC purchased what appeared to be Novo Nordisk's Ozempic from a company called Laver Beauty for a fraction of its U.S. list price.

The drug, shipped from China, arrived without proper refrigeration, raising concerns about its safety. Novo Nordisk confirmed that the product was a "diverted legitimate product" intended for the Chinese market, making it unauthorized for use in the U.S.

The company emphasized that the product's sterility could not be verified, potentially increasing patients' risk of infection.

Eli Lilly echoed similar concerns about counterfeit medications infiltrating the market.

Authorities in the U.K. have faced a surge in counterfeit weight loss drugs, with hundreds of Ozempic pens seized. Criminals exploit the high demand for these drugs by repurposing counterfeit insulin pens and labeling them as popular GLP-1 treatments.

Andy Morling, from the U.K.'s Medicines and Healthcare Products Regulatory Agency, noted that criminals often step in when supply and demand imbalances occur, making these drugs a prime target for counterfeiting.

U.S. Customs and Border Protection (CBP) has been actively intercepting counterfeit and diverted drugs at key entry points.

Sal Ingrassia, a CBP port director, stated that weight loss drugs such as Ozempic and Wegovy are frequently seized at ports of entry. Despite aggressive enforcement, many of these fake drugs make their way to U.S. customers, often ordered online or through social media platforms.

CBP seizures of weight loss medications are expected to double this year, highlighting the escalating threat.

In response, pharmaceutical companies are working closely with law enforcement and cybersecurity firms like BrandShield to shut down illegal websites and social media accounts selling counterfeit drugs.

While pharmaceutical companies like Novo Nordisk and Eli Lilly continue to innovate with treatments like retatrutide, criminals have already begun selling fake versions of the drug, which is still in clinical trials.

Price Action: NVO stock is up 2.16% at $120.07, and LLY stock is up 1.53% at $924.65 at the last check Friday.

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