GLP-1: The 360° view

By Daniel Chancellor

VP thought leadership, Norstella

The GLP-1 agonist class of drugs, pioneered by Eli Lilly and Novo Nordisk, has become the biggest news story within the biopharma industry of the last couple of years. With tremendous clinical data supporting >20% weight loss and reduction in cardiovascular outcomes, there is seemingly no limit to the potential of these medicines. Analysts and subject matter experts from across Norstella have weighed in to the debate with dozens of articles, comments, and interviews with industry observers trying to keep pace with the latest developments.

Redefining obesity as a disease with a large target market

Public interest in GLP-1s skyrocketed in 2020 upon the release of data for Novo Nordisk’s STEP trials of Wegovy, a high-dose version of Ozempic – a commonly prescribed diabetes medication approved since 2017. 15% weight loss was far superior to previous efforts, without a side-effect profile that has limited the desirability of several prior drugs. Eli Lilly followed in 2022 with its own high-dose GLP-1 agonist Zepbound showing weight loss exceeding 20% in the SURMOUNT-1 trial. Celebrity endorsements and drug shortages followed, alongside revenue forecasts that have propelled Novo and Lilly to become the two most valuable drugmakers today.

Speaking to PharmaVoice at the beginning of 2023, Daniel Chancellor, VP of thought leadership at Norstella, prophesized that “the obesity market has had several false starts going back a couple of decades, but it is finally set to realize its potential.” With the SELECT cardiovascular outcomes trial for Wegovy looming, this was seen as the seminal moment for whether obesity management would be taken as seriously as hypertension, diabetes and dyslipidemia.

“GLP-1 agonists have reduced strokes and heart attacks in those taking them for diabetes,” Chancellor wrote in segment for The Economist. Comparable long-term data among obese patients would provide the evidence base to convince prescribers and payers that these are viable long-term treatment options to consider for their patients.

The SELECT trial – a huge effort with more than 17,000 patients over five years – showed that Wegovy lowered the risk of major adverse cardiovascular events by 20%. The landmark data were first released in August 2023, and conclusively demonstrated that obesity is a serious medical condition with long term benefit in managing with GLP-1s. Speaking to CNBC, Citeline analyst Zhyar Said pointed out that “increased demand will exacerbate the shortages of Wegovy and Ozempic, which may last way into 2024.”

This hinted at the manufacturing bottlenecks that were limiting both companies’ ability to support demand for obesity and their existing diabetes patients. Novo Nordisk and Lilly were becoming a victim of their own successes, and the revenue potential of the class strongly rose in line with the SELECT results. Evaluate’s forecast in September 2023, published by The Guardian, gave a commercial opportunity of $27bn by 2028, although this number has since risen. Commenting on the addressable market in the same article, Citeline’s Jeffrey Stevens indicated that “about 100 million people in the US are obese and only three million of them are receiving treatment.”

Manufacturing, safety and access reality checks

In order to meet these numbers, Novo and Lilly would need to invest heavily in manufacturing. What followed was an impressive set of announcements, with Lilly declaring a total of $4.5bn to expand existing manufacturing sites in Illinois and North Carolina and construct a new facility in Germany. Not to be outdone, Novo Nordisk has announced approximately $11bn in manufacturing investments in Denmark and France, as well as a further $11bn to acquire fill-and-finish sites from the CDMO Catalent. Writing for Scrip, Citeline’s managing editor Kevin Grogan suggests the moves will help Novo “in its struggle to meet the demand for Ozempic for diabetes and Wegovy for obesity, which had 2023 sales of $14bn and $4.6bn, respectively.”

It is not all plain sailing – the class had a recent setback with an FDA probe into reports that GLP-1 medications were associated with an increase in suicidal thoughts. Although a preliminary evaluation has found no direct association, it is a reminder that safety is critical for chronic medications. Panalgo’s executive director Meg Richards explains in a white paper that several previous obesity drugs have been withdrawn from the market due to serious cardiovascular and neuropsychiatric side effects, while gastrointestinal tolerability can also limit compliance.

The other major hurdle is one of market access. Grace Casaschi, senior market research analyst at MMIT, penned an article on the emergence of new high-cost obesity drugs. “The escalating demand for weight loss therapies poses a significant financial burden on payers, leading to their reluctance to cover these high-cost drugs.” List prices of $16k per year are problematic for payers, although employer benefit managers are more receptive as “coverage can serve as a pivotal factor in attracting a high-caliber workforce.”

The positive data from SELECT certainly help to strengthen Novo’s case for market access. An MMIT payer poll indicated that 30% of payers would be “highly likely” to provide coverage in the case of a trial success, with a further 30% being “somewhat likely”. Jacquelyn Cafasso, market research manager at MMIT, writes that “positive results increase the probability that Congress passes a bill to pave the way for Medicare coverage, which could represent a sharp turning point for the rest of the payer realm.” While there is still no coverage of anti-obesity drugs within Medicare at time of writing, data from MMIT suggest approximately 80% of Americans with commercial insurance now have access to GLP-1 agonists for weight loss.

The sky is the limit

Despite these challenges that still need to be overcome, analysts have continued to upgrade their forecasts. Evaluate’s latest consensus for the obesity opportunity has expanded to $35bn by 2028, while total GLP-1 revenues are an astounding $85bn. This includes not just Wegovy and Zepbound, plus their diabetes equivalents Ozempic and Mounjaro, but the next generation of products, including oral formulations and combination mechanisms.

The ceiling will likely continue to rise. Investigations are ongoing in several other highly prevalent cardiovascular and metabolic diseases. Citeline’s therapy area director Tim Blackstock gave the details in an interview with Drug Discovery & Development. Novo Nordisk has reported positive clinical trials in both chronic kidney disease (FLOW) and heart failure (STEP-HFpEF), while Lilly has raised prospects for an approved non-alcoholic steatohepatitis drug (NASH) following its successful Phase II SYNERGY study. Intriguingly, Novo has also initiated a large program for semaglutide in Alzheimer’s disease. Blackstock explains “Type 2 diabetes is a risk factor for Alzheimer’s disease. The silver lining in the overlap is that the shared pathology, including insulin resistance, could pave the way for new ways to fight back.”

These developments are attracting competitors that cannot afford to ignore the opportunity at hand. Companies such as AstraZeneca and Roche have acquired obesity biotechs to build a position, while Pfizer and Amgen are expediting internal R&D programs. As the market develops and matures, it promises to have an enduring effect on the wider pharmaceutical industry, perhaps in the same way that oncology successes shaped trends over the past decade. Norstella is looking forward to supporting its partners in navigating the complexities and accelerating these important medicines to the patients that stand to benefit tremendously.


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