The dividend period of GLP-1 is fading, and both giants and Biotech are facing the "elimination" of the weight loss drug market
Efficacy, production capacity, generic drugs, price, drug suspension and rebound and other issues are all testing the innovation potential of GLP-1 players.
The giants plummeted after being pushed to the highest point by GLP-1.
In the last two weeks of July alone, Eli Lilly and Novo Nordisk shares fell by 15% and 11%, respectively, with Eli Lilly's market capitalization still declining, falling by about $150 billion from its peak of $901.3 billion on July 15.
The butterfly that incited its wings this time was the small company Viking Therapeutics, which announced the positive results of the GLP-1R/GIPR dual agonist VK2735 in the obesity phase 2, on July 25, the stock price of Linuo fell sharply, Viking soared 39% intraday, as of the day after the market returned to calm, Viking's market value is still up 15% from the 24th.
According to published data, patients treated with a 15 mg dose of VK2735 for 13 weeks lost 14.7% of their body weight (compared to baseline), which far outperformed the 5.9% weight loss of Zepbound (tirpatide) and the 3.6% weight loss of Wegovy (semaglutide).
At the same time, there is also a GLP-1 player who is also sniping Reno.
On July 25, Roche announced data on its oral version of GLP-1 receptor agonist, which can help obese people without type 2 diabetes lose 7.3% of their weight in four weeks.
In just two weeks, the upward trend of the head GLP-1 players has been blocked, and in the future, the track will be fully involuted in terms of efficacy, weight loss time, dosage form, etc., just like the original PD-1, the GLP-1 war has entered differentiation, refinement, and white heat.
01. The first battle: indication expansion
MNC will not be absent from the obesity market, but in the face of the patent cliff, it tends to focus on more high-value pipelines, and at the same time, it is also differentiating itself to deal with a long-term competition.
Some MNCs have chosen to stay out of the way, with Novartis saying it will not join the competition for GLP-1/GIP drugs. Pfizer is currently testing three new weight loss drugs, one of which uses a novel non-GLP-1 weight loss drug mechanism.
Another part of MNC is increasing in indications and administration methods: AstraZeneca's positioning of GLP-1 is to go beyond short-term weight loss and provide long-term weight management, addressing cardiometabolic risks and organ protection; Roche is betting $2.7 billion on an oral version of the GLP-1 receptor agonist and studying how the combination of anti-muscle growth statin antibodies with GLP-1 could play a further role in the future.
In addition to distancing itself from approved products in the general direction, there is more to tell about the GLP-1 indication.
Professor Daniel Drucker, one of the four scientists who revealed the structure and function of GLP-1, said that one of the really interesting things about GLP-1 drugs is that in addition to controlling blood sugar and weight, they seem to reduce complications of chronic metabolic diseases, such as heart failure, stroke, fatty liver disease, etc.
The two companies are already exploring more indications in addition to the two major sectors of hypoglycemic and weight loss.
Eli Lilly, which has already consolidated its diabetes indications, has set its sights on sleep apnea, MASH and atherosclerotic cardiovascular disease for new indications.
Novo Nordisk, on the other hand, has published the results of a study on semaglutide in the treatment of kidney disease, and there are also related studies in the field of MASH and AD.
The big players continue to stretch their tentacles until they hit the heaviest wall of GLP-1 drugs – side effects and rebound of discontinuation.
Common adverse reactions of GLP-1 on the market include gastrointestinal reactions, the incidence of GLP-1 reactions is as high as more than 40%, and patients may change the drug due to the dosing cycle and side effects of the drug in the long-term management of chronic diseases.
Real-world data show that GLP-1 adherence challenges are primarily focused on the first 12 weeks, one year, and two years. In general, after the user has adapted to the side effects of the first 12 weeks, the probability of shedding decreases significantly. With a 24% compliance rate after 2 years, there is still room for challenges.
GLP-1 real-world data study
GLP-1 may become more long-acting in addition to retaining patients with efficacy from single to dual targets, from liraglutide once a day to semaglutide once a week, to Gan & Lee Pharmaceutical's "once every two weeks" experiment, there is still a lot of room to look forward to in this field of long-acting dosage forms.
A study published in the Journal of the United States Medical Association showed that participants who switched to placebo after 36 weeks of taking Zepbound had an average weight gain of 14.8% over the subsequent 52 weeks; Participants who continued to use Zepbound lost an average of 5.5% of their body weight.
Although there are many "early adopters" of semaglutide and tirpatide, with the increase of GLP-1 weight-loss drugs, it will be one of the key competitive indicators of GLP-1 drugs to reduce the rebound of discontinuation and reduce the probability of side effects.
02. The second battle: production capacity Tianwang Mountain
According to the phase III clinical data of semaglutide released by Novo Nordisk, the effect of 68 weeks of administration in different groups is more obvious, and the weight loss ratio is between 10.6% and 18.2%. Semaglutide once a week, and the injection needs to be used with a syringe, so after the GLP-1 class of drugs broke through the clinical trial and entered the commercialization stage, just like the original mRNA drugs, they encountered production capacity difficulties.
As early as 2023, the European Medicines Agency had already indicated that Ozempic would face a prolonged supply shortage, which lasted for a full year.
Competition will be fiercer in 2024, with the FDA's updated Drug Shortage Database showing that most doses of Eli Lilly's weight loss drug Zepbound and diabetes drug Mounjaro will experience supply shortages in the second quarter of this year; In addition, Novo Nordisk is also presenting the same problem, with the supply of partial doses of the weight loss drug Wegovy and the diabetes drug Ozempic also in short supply.
Novo Nordisk is crazy about building factories.
In November 2023, Novo Nordisk successively announced the expansion of two factories in Denmark and France, with a total investment of about 8 billion US dollars; In January, Novo Nordisk's parent company acquired CDMO company Catalent, acquiring the company's bottling plants in Italy, Belgium and the United States. Interestingly, Catalent was previously a CDMO supplier to Eli Lilly, so Eli Lilly also suggested that the FDA initiate an antitrust investigation against its competitors.
On March 19, 2024, Novo Nordisk China said that it will invest about 4 billion yuan in Tianjin for the expansion of sterile preparations, including a pre-filled injection pen production line and a finished product workshop, and Novo Nordisk is building factories around the world to increase semaglutide production capacity.
Eli Lilly pulls CDMO to increase production capacity.
The news that Eli Lilly's peptide supplier Corden Pharma announced a 900 million euro (about 7 billion yuan) expansion of production shocked its competitors. Not only that, Eli Lilly is also cooperating with CDMO players in the API field, including Polypeptide, Bachem, and WuXi STA Pharmaceuticals.
Eli Lilly is also expanding its manufacturing capacity, and since 2020, Eli Lilly has planned to invest more than $16 billion to build new manufacturing facilities in the United States, Ireland, and Germany to expand its tirpatide production capacity.
03. The third battle: imitation sniping
In fact, it is not only the "GLP-1 duo" who wants to increase production capacity, but also generic drug companies.
Taking the Chinese and India markets as examples, the core patents of semaglutide will expire in 2026, and if the patent period cannot be extended, global generic drug companies will frantically pour in.
Many pharmaceutical companies in India, such as the four generics giant Sun Pharmaceutical, Cipla, Reddy's and Lupin, have said they are investing in semaglutide.
Domestically, Huadong Pharmaceutical's subsidiary, Zhongmei Huadong, has submitted an invalid application for the core patent of semaglutide to the State Intellectual Property Office. In September 2022, the State Intellectual Property Office announced that the patent for the GLP-1 compound of the original semaglutide was invalid because Novo Nordisk "did not disclose the experimental result data of the core compound of semaglutide". In this regard, Novo Nordisk filed a patent lawsuit, and the patent is currently in the second instance stage of administrative litigation.
Subsequently, a large number of domestic generic drug companies began to deploy GLP-1 one after another. In April 2024, Jiuyuan Gene submitted a marketing application for a biosimilar of semaglutide, becoming the first company in China to report the production of this drug. Its declared indication is glycemic control in adults with type 2 diabetes.
Of course, if Novo Nordisk wins the patent lawsuit, the launch of Jiuyuan Gene's products may be hindered, thereby reducing the competitive pressure on Novo Nordisk. Jiuyuan Gene itself admits this, arguing that "unless the court finally decides that the patent is invalid, 'Jiyoutai' cannot be commercialized before the patent expires."
In addition to Jiuyuan Gene (Jiyoutai), domestic semaglutide has entered the phase III clinical stage (diabetes indications) including: Huadong Medicine, Bowei Biotechnology, Sihuan Pharmaceutical, Zhuhai Federation, Livzon Group, Chia Tai Tianqing, Quality Peptide Biotechnology, Beite Pharmaceutical, etc. In addition, semaglutide from CSPC Pharmaceutical Group, Qilu Pharmaceutical, Terui Pharmaceutical, Hanyu Pharmaceutical, and China Resources Shuanghe belongs to the chemical synthesis process (Class 2.2 of the Chinese Chemical Drug Registration Classification).
Hyperlink: The first generic version was accepted in China, and semaglutide was "sniped" across the board
Some commentators believe that when the number of participants surges, they have to face the situation of "involution" of both R&D and production, which will certainly stimulate enterprises to develop better GLP-1 products, but also make the risk of failure of enterprises greater.
04. The fourth battle: the balance of price
India pharmaceutical companies have said that as new drug synthesis methods are developed, the cost of GLP-1 drugs may be reduced by at least half in the future, and the price may eventually reach one-tenth of the current drug price.
Nature once commented on this on the Home: China and India can make a discount.
Whether it is the "encirclement and pursuit" of new GLP-1 drugs or the "blocking" of generic drug companies, it has exacerbated the sense of crisis between the two parties. Eli Lilly launched a business savings card program for GLP-1 drugs, allowing some people with commercial insurance to purchase a one-month or three-month prescription drug for $25. The Novo Nordisk savings card only needs to pay as little as $25 to get a 3-month prescription dose of hypoglycemic drugs.
The business of the two companies has a relatively good month-on-month growth in the second half of 2023, which is also related to the savings card plan.
Government agencies will also put pressure on the price scale, and in early July 2024, United States President Joe Biden published an article in United States Today, asking Novo Nordisk and Eli Lilly to reduce the price of diabetes drugs led by GLP-1.
"If the price of these drugs is not significantly reduced, they have the potential to bankrupt the United States health care system," Biden said.
Of course, the factors that affect the final selling price of GLP-1 also include upstream packaging materials and raw materials, as mentioned above, Eli Lilly and Novo Nordisk have expanded their production capacity through their own ways, and in the field of packaging materials, long-term and high-profile people will give rise to a larger market.
According to the estimation of Debang Securities' pharmaceutical model, the global demand for insulin end + GLP-1 injection pens will be 9.542 billion in 2030, of which the market size of GLP-1 injection pens will be 26.38 billion yuan.
With the influx of more and more GLP-1 players, the approval of related products and the expansion of indications will be faster and faster, and the price will continue to decline due to a variety of factors. In the supply chain, the expansion of injection pen production alone will also require a preparation period of nearly 10 months, and it remains to be seen whether the latecomers will be fully armed and occupy a place in the fierce battle of GLP-1.