SYDNEY, May 22 (Reuters) - Australia said on Wednesday

it will ban copies of drugs used for weight loss such as Ozempic

and Mounjaro, arguing that so-called compounded versions are not

rigorously tested and are potentially unsafe.

Demand for Novo Nordisk's Ozempic and Eli Lilly's ( LLY )

Mounjaro has soared due to the diabetes drugs being used

for their weight-loss effects. They belong to a growing class of

drugs called GLP-1 receptor agonists that reduces food craving

and slows digestion, helping patients feel sated for longer.

But their popularity has led to shortages, turning patients

to compounded alternatives.

Compounded drugs are custom-made medicines based on the same

ingredients as branded versions. They are often cheaper but are

not clinically evaluated by regulators for safety, quality or

efficacy.

Health Minister Mark Butler said there were increasing

reports of patients coming to harm from GLP-1 copies, including

the hospitalisation of an Australian due to a serious adverse

event.

"To keep Australians safe, new regulations will remove

(GLP-1 receptor agonists), such as those being misrepresented

and sold as replica Ozempic or Mounjaro, from the pharmacy

compounding exemptions," Butler said in a statement.

The change will be effective from Oct. 1, giving patients

time to source a regulated drug, he said.

At least 20,000 Australians are taking pharmacy-made

compounded versions of Ozempic and Mounjaro, with the majority

using them to shed weight, Butler said.

In February, U.S. Food and Drug Administration Commissioner

Dr. Robert Califf said he was concerned about the prevalence

online of compounded versions of drugs used to lose weight.

Some analysts forecast the market for diabetes cum

weight-loss drugs, currently led by Novo Nordisk and Eli Lilly ( LLY ),

could reach $100 billion a year by the end of the decade.