In July 2019, we first shed light on the hype surrounding the so-called "weight loss injection" that was emerging at the time and exploded from 2023 onwards. The trend, fueled by social media and celebrity users, had triggered a veritable surge in demand for GLP-1 drugs such as Ozempic and Mounjaro, pushing manufacturers to their production limits. We discovered that the drugs not only enabled considerable weight loss of 15 to 22 percent, but also required long-term use to prevent a return to the original weight. The huge potential became apparent early on: with more than 650 million people with obesity worldwide and a predicted market volume of up to 100 billion US dollars by 2030, we were talking about a megatrend. Even back then, the far-reaching effects of the drugs were already evident far beyond pure weight reduction - positive study results for heart and kidney disease triggered share price increases for manufacturers, while other sectors, such as dialysis providers or the food industry, felt the disruptive effects.
At the same time, however, we also warned that the hype had turned the shares of the leading providers into consensus favorites, making them vulnerable to setbacks due to their high valuations. There were unanswered questions about production capacities, long-term cost coverage by insurers and potential new competitors or unforeseen risks. It is against this backdrop that we look at developments since then.
Two providers, one market and new competition
The duopoly already described in 2023 has become even more entrenched: Two major providers dominate the market with their blockbusters - one with semaglutide-based preparations, the other with a GIP/GLP-1 receptor agonist. The latter has since been able to continuously gain market share. This is one of the reasons for the sharp fall in the share price of the other provider over the last twelve months (the valuation is now well below the average of recent years). In addition, the profit and sales forecasts were revised downwards in July 2025 - accompanied by the introduction of a new CEO. We suspect a strategic "kitchen sinking" behind this maneuver to divert attention from the problems. The production bottlenecks that were already noticeable at the time escalated into one of the biggest challenges. Demand far outstripped supply. Both market leaders were forced to announce investments worth billions in new production capacities. This persistent shortage had a particular consequence, especially in the USA: as soon as the FDA officially placed the drugs on the "Drug Shortages List", so-called compounding pharmacies appeared on the scene. These specialized pharmacies are allowed to produce legal but unbranded versions of the active ingredients in order to bridge the supply shortage. This created a regulatory grey area that ensured access for many patients, but also triggered debates about safety and standardization, as these preparations do not undergo the FDA's strict approval procedures. It is estimated that only around 70% of patients use the official products of both companies. While the list price has fallen from USD 1,350 (2023) to a self-pay price of USD 450 (2025), the compounded version of the syringe only costs around USD 250. Patent protection has already expired in Canada and Brazil. The entry of generics has further accelerated price erosion there. The previously mentioned competitive pressure has also materialized: In China, a partner company received approval for a product sold exclusively there. Other suppliers, including several large pharmaceutical groups and biotech companies, are pushing forcefully into this attractive market.
What's next: new technologies, new target groups
The further development of obesity treatment is progressing rapidly - away from injections and towards simpler and more potent forms of therapy. One milestone is the development of GLP-1 drugs in tablet form. An oral preparation is already on the market; the next generation aims to be more effective and more widely used. The main challenge is the low bioavailability of oral peptides. In order to pass through the digestive tract, they have to be taken in high doses and with excipients - often under strict dietary restrictions. So-called "small molecules" are a promising alternative. These chemically stable active ingredients are easier to formulate as tablets and do not require complex administration conditions.
An active ingredient of this class is currently in clinical development and is showing promising results. In addition, research is already focusing on the next generation: so-called triple agonists, which simultaneously bind to the GLP-1, GIP and glucagon receptors. In studies, a representative of this substance class achieved an average weight loss of over 24 percent of body weight after 48 weeks - a result that comes close to the effectiveness of surgical interventions for weight reduction.
In addition, the focus is shifting from pure weight reduction to "quality of weight loss". One criticism of current medication is that patients not only lose fat, but also muscle mass. Future treatments will therefore focus specifically on muscle maintenance. A promising approach is the combination with active ingredients that promote muscle building. The aim is not only to reduce weight, but also to achieve a healthier body composition. GLP-1 preparations are currently approved for obesity (BMI ≥ 30) or obesity with concomitant diseases (BMI ≥ 27). With the introduction of oral preparations, demand could expand beyond the medical indication to the cosmetic sector. Initial estimates assume a monthly price of between 150 and 200 US dollars. At the same time, the potential of this class of active ingredients for other indications is becoming increasingly clear. Large-scale studies have shown that GLP-1 agonists significantly reduce the risk of serious cardiovascular diseases such as heart attacks and strokes. Further studies are underway for the treatment of chronic kidney disease, non-alcoholic fatty liver disease (NASH) and even neurodegenerative diseases such as Alzheimer's and Parkinson's, as the receptors also play a role in the brain.
Billion-dollar market with a price cap?
The market dynamics remain exciting. While more players are entering the market, the expected total market, which is often estimated at over 100 billion US dollars by 2030, could paradoxically be somewhat smaller than forecast due to the success of oral drugs. Tablets are likely to be offered at a significantly lower price than the complex injections, which could dampen overall sales as volumes increase.
One leading provider appears to be strategically broadly positioned: With an oral small molecule, it is addressing the growing market of slightly to moderately overweight patients as well as cosmetically motivated patients. An already successfully established injection preparation is available for the severely obese segment. And with a triple agonist for extreme obesity, another promising preparation is currently in clinical development.
Regulation as a risk
The US pharmaceutical industry is under political pressure. With the appointment of Robert F. Kennedy Jr. as Secretary of Health and Human Services, the government is pursuing an industry-critical line. Under the slogan "Make America Healthy Again", a confrontational course is being adopted, accompanied by significant job cuts at the FDA. This is fueling fears that approval procedures for new therapies could be significantly delayed.
At the same time, the government is pushing ahead with a protectionist trade policy. Although threatened tariffs have not been implemented for the time being, their impact on the industry is noticeable. Companies are reacting with massive investment announcements in the US location - as part of a "USA for USA" strategy. The aim is to reduce dependence on international supply chains. Investment commitments in the billions have been made by major industry players, among others.
However, the central issue remains the so-called "Most Favored Nation" decree. It links the prices for patented drugs in the USA to the lowest prices in comparable industrialized countries. This calls into question the current business model - the high US prices have so far been regarded as a key pillar for financing global research activities. At the same time, generics are already significantly cheaper in the USA than in Europe. The new pricing logic aims to increasingly shift the cost burden of future innovations to other markets, particularly Europe.