The Global Epidemic of Obesity

Obesity stands as one of the most challenging enigmas in medicine, both for its pervasive impact on global populations and the myriad of health complications it spawns. With 2.8 million deaths annually attributed to excess weight, obesity reigns as the leading cause of premature mortality.

Notably, medications combating obesity were hailed as the most significant scientific breakthrough of 2023 by the esteemed journal “Science.” Projections suggest a staggering global market size ranging between $100 and $150 billion by 2030, as forecasted by Barclays.

Market Landscape

In this current wave of advancements, two standout drugs, approved by the FDA, have emerged: Wegovy by Novo Nordisk (active ingredient: semaglutide) and Zepbound/Mounjaro (with regional variations in nomenclature) by Eli Lilly (active ingredient: tirzepatide). These drugs have demonstrated remarkable efficacy, enabling weight loss of up to 20% in patients. Furthermore, their manufacturers are exploring potential positive impacts on cardiovascular diseases and sleep apnea.

Amidst this landscape, other pharmaceutical giants such as Pfizer, Boehringer, Merck, and Amgen are actively developing their own obesity treatments. Although not expected to enter the market for at least another year, these new developments aim to deliver additional benefits, surpassing existing medications.

The stocks of Novo Nordisk and Eli Lilly have soared approximately 75% and 60%, respectively, over the past year, firmly establishing themselves as frontrunners in the pharmaceutical sector. Notably, Novo Nordisk has outstripped LMVH as the European company with the highest market capitalization, ranking 14th globally. Eli Lilly holds the 8th position with a market capitalization of $717 billion, prompting analysts to speculate whether it could become the first pharmaceutical stock to surpass the $1 trillion mark.

Both companies have expressed concerns regarding their ability to meet demand, even in 2024.

Novo Nordisk is heavily invested in leveraging its early market entry:

• • Announcing an annual investment program ranging between $5,000 and $6,000 million until 2030, facilitated by the profits generated from Ozempic and Wegovy.

• • Focusing on enhancing its production capacity to address the significant unmet demand, achieved through expanding its own factory capacity (e.g., in France and Denmark) and acquiring companies with suitable production capabilities for Wegovy.

• • Notably, in its clinical study “Select,” Wegovy surpassed expectations, yielding promising results such as a 20% reduction in the likelihood of heart attacks.

Eli Lilly is also accelerating its efforts to solidify its market position, with Mounjaro/Zepbound already approved by both the FDA and the European Medicines Agency, although it is still pending approval for its multidose applicator:

• • Its partner in obesity treatment, BioAge, has raised $170 million to advance clinical trials.

• • Additionally, Eli Lilly has announced a substantial investment to double its production capacity, allocating more than $11 billion, including $2.3 billion in a new production facility in Germany.

Challenges Ahead

Despite the vast market potential, with billions worldwide affected by overweight or obesity, certain factors will significantly influence the selection of preferred treatments by patients:

• • Safety: The safety profile of a medication is paramount, especially for a chronic condition like obesity. Concerns have emerged regarding various safety issues, including uncertainties about long-term effects, potential associations with suicidal ideation, thyroid cancer risks, and gastrointestinal side effects.

• • Price: Government reimbursement policies and drug prices will undoubtedly shape market dynamics. For instance, in Spain, although semaglutide is recommended by the Spanish Agency of Medicines, the Ministry cannot afford this therapy for over 10 million people.

• • Efficacy: The efficacy of drugs in preserving safety and delivering superior outcomes will determine market preferences.

• • Administration Route: A shift towards more convenient or less invasive administration routes, such as oral intake, poses strategic challenges. Novo Nordisk’s development of an oral pill faces obstacles due to its substantial dosage requirement, particularly amid production scarcity.

• • Additional Positive Effects: Demonstrating additional positive effects may also be crucial for reimbursement approval or specialist prescription.

Conclusion

The forthcoming years will witness one of the most pivotal battles in medical history, with Novo Nordisk and Eli Lilly holding a strategic advantage due to the advanced stages of their product development. Nevertheless, nearly all major competitors will exert considerable efforts to penetrate this lucrative market opportunity.

It will be a fierce battle where each clinical trial, adverse effect, or strategic decision promises to exert a profound impact. Although predicting the ultimate winners is challenging, it seems inevitable that pharmaceutical companies will spare no effort in the coming years to secure a slice of the lucrative obesity market pie.