By Recent buzz in the pharmaceutical world has shifted to a promising new class of obesity medications – specifically, the pills still in development – which could potentially revolutionize treatment for billions of people worldwide. Leading pharmaceutical companies, including Eli Lilly, Novo Nordisk, Pfizer, and Structure Therapeutics, are currently competing to develop these pills.
While injectables are already on the market, they may soon be outpaced by their oral counterparts. Cheaper and easier to take, these pills would be much more appealing to patients struggling with obesity, thus expanding the potential market for these drugs significantly. Furthermore, they would require less supply, easing some of the shortfalls that have occurred with injectable versions.
The new drugs, known as GLP-1s, offer efficacy similar to that of the injectables without needles or high costs. However, there is little data on their long-term efficacy, indicating that patients may need to take them regularly to maintain the intended benefits. As a result, doctors are eager for a pill-based alternative that would make long-term treatment more viable.
“Oral maintenance opens up the obesity [total addressable market], mutes payor pricing concerns, and may not be that dilutive to margins,” noted Jefferies healthcare strategist Will Sevush.
While many questions about these new weight-loss pills remain unanswered as research continues, investors have already shown keen interest in this new class of drugs. Eli Lilly and Novo Nordisk stand out as leading competitors in this space, with both companies presenting compelling data at a recent medical conference. With continued progress and innovation in this evolving field, the potential to improve outcomes for obesity patients is enormous.
Pharmaceuticals to Watch: Novo’s High-Dose Semaglutide
The pharmaceutical industry is evolving at a rapid pace, with companies producing drugs for a vast variety of conditions. Investors are keeping a keen eye on emerging drugs that show promise in treating obesity with fewer side effects.
One such company pressing forward in this arena is Novo. Novo is ahead of the curve in GLP-1 development and has an oral GLP-1 on the market, marketed under the name Rybelsus, for treating Type 2 diabetes, not obesity. However, after testing the adapted oral formulation of semaglutide, the same molecule present in Rybelsus and their injectables Ozempic and Wegovy, for treating obesity, Novo reported that patients on the high-dose pill achieved weight loss of 15.1% after 68 weeks compared to 2.4% with placebo. This impressive result has given Novo the edge in capturing market share.
The once-daily high-dose weight-loss pill is speculated to reach the FDA later this year. Still, Novo’s history of difficulties meeting demand for Wegovy suggests they may delay launching the product due to “portfolio prioritizations and manufacturing capacity.”
This new drug would add one more impressive feather in Novo’s cap by advancing in the obesity market and overtaking their potential oral GLP-1 competitors. Nevertheless, TD Cowen analyst Michael Nedelcovych has stated that despite the drug’s potential success in treating obesity, it may not launch in that indication “for some time.” Investors keen to cash in on Novo’s growth will need to keep a watchful eye on the progress of this promising medicine.
Lilly’s Orforglipron
In the highly competitive market of weight-loss pills, Lilly is a major player. The pharmaceutical company has been developing a promising drug called orforglipron, which has demonstrated impressive results in a recent Phase 2 trial. Obese or overweight patients on the highest dose of orforglipron lost a staggering 14.7% of their weight after 36 weeks, compared to only 2% for patients on a placebo. This is comparable to the results achieved by Novo’s semaglutide in pill and injectable form according to Goldman Sachs analyst Chris Shibutani.
But what sets Lilly’s orforglipron apart from other drugs in the same category is its once-daily dosage, making it as easy and convenient as taking your daily vitamin. What’s more, unlike the high-dose semaglutide by Novo, orforglipron can be taken with food, which could be a significant advantage if both drugs are shown to perform similarly in head-to-head trials.
While Lilly still has to complete several Phase 3 trials before asking the FDA to approve orforglipron, the study that they expect to run the longest is expected to be completed by mid-2025. So, the earliest we could see potential approval of orforglipron is 2026.
Pfizer’s Danuglipron
Pfizer, one of the leading drug companies in the industry, has set its sights on entering the highly lucrative obesity and diabetes market. The company announced on Monday that it has chosen danuglipron as its entrance into this space. Danuglipron is a twice-daily pill, fiercely competing with Lilly’s once-daily orforglipron and other similar drugs.
Pfizer had earlier dropped an early-stage obesity pill, lotiglipron, citing concerns about potential safety issues related to higher levels of liver enzymes in some patients who used the drug. This announcement caused Pfizer’s stock to drop sharply on Monday, closing down by 3.7%.
Despite the concerns about danuglipron requiring two doses per day instead of one, Pfizer seems confident that the drug will hold its own in the marketplace. Only time will tell if danuglipron can live up to its potential and prove to be as effective as its competitors.
GLP-1 Drugs in Development: A Look at Pfizer, Structure, and Terns
As Pfizer faced a major selloff due to concerns over its GLP-1 drug danuglipron, other biotechs in the space are still making headway with their own developmental treatments.
Structure’s GSBR-1290
Structure is currently testing an oral GLP-1 drug known as GSBR-1290, which is still in its early stages of development. The company is set to begin Phase 2b trials next year and could launch the drug as early as 2029, pending successful tests. Investors are eagerly awaiting the release of Phase 1b/2A data in the fourth quarter of this year.
The recent news of Pfizer’s struggles with danuglipron actually had a positive effect on Structure’s stock, which jumped by 18.4% on Monday. However, the stock did fall by 6.5% on Tuesday.
Terns’ T-601
Terns Pharmaceuticals’ T-601 is also an oral GLP-1 drug currently in development. While Terns shares have been dropping in recent days, some of this may be attributed to a separate liver condition drug program from the company. Concerns have also arisen related to T-601’s structural similarity to danuglipron, which has led some investors to wonder about potential liver issues.
However, Mizuho analyst Graig Suvannavejh noted that they do not expect elevated liver enzymes to be an issue for T-601. So far there have been no reported issues. Despite the concerns, T-601 is still in an early stage of development without a clear launch timeline.
It remains to be seen how competition in the GLP-1 drug space will play out over the next few years, but it’s clear that biotechs like Structure and Terns are still making strides with their own developmental treatments.
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