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Weight loss drugs exploded into the public eye this year, and 2024 will deliver extra change to the evolving market.
The medication skyrocketed in recognition in 2023 as they helped sufferers shed vital weight, regardless of hefty price tags, combined insurance coverage and a handful of unpleasant side effects.
Demand for the medication is unlikely to decelerate in 2024, particularly as remedies progressively grow to be extra accessible. Much of Wall Street believes the weight loss drug market will solely develop, with some analysts projecting that it is going to be worth $100 billion by the finish of the decade. Goldman Sachs analysts expect 15 million U.S. adults to be on weight problems drugs by 2030.
But subsequent year, buyers shall be watching how the dominant gamers in the market, Novo Nordisk and Eli Lilly, navigate supply issues plaguing their remedies. Patients have been struggling to get their palms on Novo Nordisk’s weight loss injection Wegovy, its diabetes therapy Ozempic, and Eli Lilly’s diabetes injection Mounjaro.
Analysts expect supply constraints to enhance however observe that the broader problem will take years to resolve.
Outside of provide headwinds and the lack of broader insurance coverage protection for weight loss medication, Novo Nordisk and Eli Lilly have a giant year ahead of them.
Novo Nordisk might win approvals for expanded use of Wegovy in the U.S. and Europe. Eli Lilly’s newly authorised weight loss drug, Zepbound, might garner greater than a billion {dollars} in gross sales in its first year on the market.
Both firms are additionally anticipated to launch new information that might present different potential well being advantages of their medication past weight loss and diabetes administration, which can improve insurance coverage protection down the line.
Next year might imply much more to the different firms hoping to be a part of what’s to date been a two-horse race to make weight loss remedies.
New drug information from Pfizer and Amgen, and the potential for extra buyouts or collaborations between bigger firms and smaller makers of weight problems medication, might alter the market’s aggressive panorama in the coming months.
Supply points might ease however will not go away
The supply problems plaguing Wegovy, Ozempic and Mounjaro are doubtless “the largest factor” buyers will watch subsequent year, Guggenheim analyst Seamus Fernandez advised CNBC.
Some analysts stated provide constraints will doubtless persist for years, however expect them to ease in 2024 as Novo Nordisk and Eli Lilly work to develop manufacturing capability for his or her medication.
Novo Nordisk throughout its third-quarter earnings name in November stated it’s ” considerably scaling our provide” of Wegovy in the U.S. in 2024. TD Cowen analyst Michael Nedelcovych advised CNBC that the firm throughout the name appeared to counsel that such a change would not seem like a giant leap in provide however slightly regular enhancements over time.
Supply might improve extra considerably years from now: Novo Nordisk in November stated it will make investments $6 billion to develop its manufacturing services in Denmark, noting it would end development from the finish of 2025 by way of 2029. The firm additionally stated it will spend around $2.3 billion to develop one other manufacturing website in France.
Top weight loss and diabetes medication
Wegovy from Novo Nordisk is a weekly weight loss injection for adults with weight problems or who’re chubby. The drug mimics a hormone produced in the intestine known as GLP-1 to suppress an individual’s urge for food.
Zepbound from Eli Lilly is a weekly weight loss injection for adults with weight problems or who’re chubby. The therapy mimics GLP-1 and one other intestine hormone known as GIP to cut back urge for food and meals consumption.
Ozempic from Novo Nordisk is a weekly injection that helps decrease blood sugar ranges in adults with Type 2 diabetes. The treatment mimics GLP-1 to suppress urge for food and assist the pancreas make extra insulin.
Mounjaro from Eli Lilly is a weekly injection that helps decrease blood sugar ranges in adults with Type 2 diabetes. The drug mimics GLP-1 and GIP to curb urge for food and stimulate insulin manufacturing.
Meanwhile, Eli Lilly stated throughout its third-quarter earnings name in November that offer of Mounjaro has improved in the U.S. even because it stays constrained round the globe.
Executives additionally stated that Eli Lilly is on observe to obtain its purpose of doubling manufacturing capability for medication akin to Mounjaro, in half by way of investments in new manufacturing websites in North Carolina and Indiana.
But Eli Lilly CEO David Ricks stated on the name that the firm is “aggressively planning” additional manufacturing buildup for Mounjaro and different medication. He added that “it is an issue we work on day by day. So we’re in no way proud of the capability.”
Zepbound might grow to be a blockbuster
The FDA approves Eli Lilly’s Zepbound, a weight loss drug comparable to Ozempic and Wegovy.
Courtesy: Eli Lilly
Morgan Stanley expects Zepbound to rake in $2.2 billion in gross sales in 2024, in accordance to a observe launched after the drug’s approval in November. Meanwhile, Bank of America analysts in a November observe projected $2.7 billion in Zepbound income in 2024.
Some analysts expect much more gross sales progress for Zepbound and Mounjaro past 2024. Tirzepatide, the lively ingredient in each medication, has a “very robust shot of being the best-selling molecule of all time in the pharmaceutical business,” stated Guggenheim’s Fernandez.
Wall Street is captivated with Zepbound in half as a result of it might trigger extra weight loss than Wegovy. Studies straight evaluating the two, together with an ongoing trial from Eli Lilly, would want to verify that.
Results from that trial might come out subsequent year after preliminary information from separate studies analyzing Zepbound as a possible therapy for different well being circumstances, together with heart failure.
Mixed insurance coverage protection will doubtless weigh on gross sales of Zepbound and different weight loss medication in 2024, however Eli Lilly has already secured some protection for the drug.
Wegovy might make historical past once more
Wegovy made historical past this year when it slashed the risk of great coronary heart issues by 20% in folks with weight problems and coronary heart illness in a late-stage trial. In 2024, the drug might shake up the pharmaceutical business once more if U.S. and European regulators resolve to approve it for that goal.
Those potential approvals, which might make Wegovy the first GLP-1 drug to have an expanded use for coronary heart well being, are a “foregone conclusion” for Novo Nordisk, Cantor Fitzgerald’s Louise Chen advised CNBC.
Still lifetime of Wegovy an injectable prescription weight loss drugs that has helped folks with weight problems. It ought to be used with a weight loss plan and bodily exercise.
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An FDA approval might doubtlessly improve the uptake of Wegovy, encouraging extra weight problems specialists, main care suppliers and cardiologists to prescribe it to eligible sufferers, stated Dr. Eduardo Grunvald, medical director for UC San Diego’s Center for Advanced Weight Management.
An approval may put extra strain on U.S. insurers to ultimately cowl Wegovy and comparable weight loss remedies, opening the door for broader use.
Eli Lilly can also be studying the cardiovascular advantages of Zepbound in a part three scientific trial in diabetes sufferers with elevated cardiovascular danger, and outcomes are anticipated in late 2024. The drugmaker is conducting a similar study in overweight sufferers with heart-health dangers, however outcomes might not come till 2027.
Meanwhile, Novo Nordisk’s different remedies might attain their very own milestones subsequent year.
Novo Nordisk expects to launch information in the first half of 2024 from a late-stage trial analyzing Ozempic as a therapy for kidney failure in diabetes sufferers with persistent kidney illness. The firm hinted that the trial could be successful when it halted the research a year sooner than deliberate in October primarily based on an interim evaluation.
Upcoming scientific trial information releases
- A phase-three trial from Eli Lilly on Zepbound as a therapy for cardiovascular issues in diabetes.
- A phase-three trial from Novo Nordisk on Ozempic as a therapy for kidney failure in diabetes sufferers with persistent kidney illness.
- A phase-three trial from Novo Nordisk on a 25-milligram model of its once-a-day weight loss capsule.
- A phase-three trial on Zepbound as a possible therapy for coronary heart failure in sufferers with weight problems.
- A phase-three trial on Zepbound as a possible therapy for non-alcoholic fatty liver illness, which is brought on by fats buildup in the liver, in sufferers with weight problems.
- A phase-three trial on Zepbound as a possible therapy for obstructive sleep apnea, or the pause of respiration throughout sleep due to blocked airways, in sufferers with weight problems.
- A phase-three trial on IcoSema, a mixture of once-weekly insulin and once-weekly semaglutide, in sufferers with diabetes.
Novo Nordisk can even launch part three scientific trial information on a 25-milligram model of its once-a-day weight loss pill, which makes use of semaglutide, the identical lively ingredient as in Ozempic and Wegovy.
That trial is essential as a result of Novo Nordisk is ready to see that information earlier than submitting for approval of the oral weight loss drug, stated Cowen’s Nedelcovych. He added that in the long run, the availability of weight-loss tablets might enhance capability for his or her injectable counterparts.
Also in 2024, a study following sufferers from a earlier late-stage trial might doubtlessly generate information supporting Wegovy as a therapy for stopping the growth of diabetes, Nedelcovych stated.
A make-or-break year for Pfizer
New information subsequent year shall be essential to figuring out whether or not Pfizer will get a chunk of the weight loss drug area. The stakes are excessive: CEO Albert Bourla has stated the firm hopes to capture $10 billion of that market.
Pfizer axed a twice-daily version of the solely weight problems product in its pipeline earlier this month after sufferers taking the capsule misplaced vital weight however had bother tolerating the drug in a mid-stage study.
Now, the firm is pinning its hopes on a once-a-day model of the capsule, generally known as danuglipron, which it believes might trigger fewer antagonistic unwanted effects. Pfizer stated it expects to launch extra information on that model of the drug in the first half of 2024, which can assist the firm resolve whether or not to begin a late-stage research on the capsule.
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However, some analysts have raised questions on whether or not the once-a-day model shall be simpler to tolerate.
“Despite ongoing work, tolerability nonetheless seems to be a difficulty with the product, and it isn’t clear to us why this may enhance” in a part three trial or with a once-daily model, JPMorgan analyst Chris Schott stated in a December observe.
Barclays analyst Carter Gould stated in a December observe that it’s “more and more obvious” that the firm can have to look externally for an weight problems therapy, whether or not that is by way of an acquisition or partnership, to seize a slice of the weight loss drug market prefer it had hoped.
Meanwhile, upcoming information will reveal how severe Amgen’s weight loss drug portfolio is. In the first half of 2024, Amgen is slated to publish early stage trial data on an oral weight loss treatment.
In the second half of the year, Amgen plans to launch mid-stage trial information on an injectable drug that helped trigger up to 14.5% weight loss after 12 weeks in an early research.
Watch for buyouts and partnerships
Pfizer is not the solely firm that might profit from trying externally for weight problems medication.
Larger drugmakers used acquisitions of smaller companies, or partnerships with them, to carve out area in the weight loss drug market this year. More firms might deploy the technique subsequent year, analysts stated.
“There are a bunch of different large-cap pharmas on the record who might do that,” stated Cantor Fitzgerald’s Chen.
Swiss firm Roche stated earlier this month it will buy the privately held U.S. weight problems drugmaker Carmot Therapeutics for $2.7 billion. AstraZeneca signed a licensing agreement with Chinese biotech firm Eccogene to develop an weight problems capsule.
Novo Nordisk and Eli Lilly have additionally snapped up smaller weight problems drug firms this year to preserve their dominance in the market.
Recent weight loss drug buyouts and partnerships
- Roche in December stated it would buy privately held weight problems drugmaker Carmot Therapeutics for $2.7 billion.
- AstraZeneca in November stated it signed a licensing agreement with Chinese biotech firm Eccogene to develop an weight problems capsule.
- Novo Nordisk in August stated it would acquire the privately held weight problems drugmaker Inversago Pharma for $1.08 billion.
- Novo Nordisk in August stated it would acquire Embark Biotech, which develops weight problems and diabetes medication, for up to $500 million.
- Eli Lilly in July stated it would acquire privately held weight problems drugmaker Versanis for $1.93 billion.
In an announcement to CNBC, Novo Nordisk stated it has elevated its deal with “sourcing and elevating exterior innovation” to complement its in-house merchandise and broaden its drug pipeline, particularly for diabetes, weight problems, heart problems and uncommon blood issues.
The firm additionally stated it’s in the “full vary of enterprise growth actions,” from acquisitions to partnerships on early or late-stage merchandise, when it comes to firms with new organic medication, new potential therapy targets and new mechanisms of motion, or how a drug works.
Chen stated acquisitions or partnerships could also be the solely manner for small- to mid-cap weight loss drugmakers to meet up with Eli Lilly and Novo Nordisk.
Some smaller firms have indicated that they’re open to the concept: Altimmune stated Dec. 5 that it’s looking for partners to launch and develop its experimental weight problems drug pemvidutide.
Shares of Altimmune have jumped greater than 140% since Nov. 30, when the firm launched mid-stage trial data displaying that its injectable drug brought about 15.6% weight loss on common after 48 weeks.
Other smaller weight loss drugmakers embody Structure Therapeutics, whose once-daily capsule helped chubby or overweight sufferers lose up to 10 kilos of weight on common after a month in an early-stage trial. The firm is predicted to report mid-stage trial information on its drug in diabetes sufferers this month and extra outcomes on the capsule in sufferers with weight problems early subsequent year, Guggenheim’s Fernandez famous.
Still, some greater drugmakers might wait to see bigger and later-stage information from smaller firms earlier than shifting to purchase them. That information might not come out till 2025 or later for a lot of corporations, stated Fernandez.