Competitive Analysis Shows Ozempic Overthrown: Leading Weight Loss Medication Title Switched due to New Study Results
Competitive Analysis Shows Ozempic Overthrown: Leading Weight Loss Medication Title Switched due to New Study Results
When you think of a leading weight reduction medication, it's likely that Ozempic is the first name that springs to mind. Although it's approved for diabetes (with Wegovy, its equivalent version, being approved for weight loss), numerous individuals have been utilizing it for weight loss purposes for years, and it's proven to be exceptionally effective in this regard. The success of Ozempic and Wegovy has significantly contributed to Novo Nordisk's (NVO 0.15%) status as one of the world's most valuable healthcare stocks.
However, in a relentlessly competitive market for weight loss drugs, Ozempic and Wegovy aren't the sole options for individuals seeking to shed pounds. A recent study suggests that it might not be Ozempic or Wegovy that yields the best weight loss results. Instead, that potential could originate from Novo Nordisk's longtime competitor, Eli Lilly (LLY 0.50%).
Zebound dominates in direct comparison study
Pharmaceutical companies frequently conduct clinical trials for drugs, but these trials often lack direct comparability due to slight variations in patient populations and time periods. Consequently, it can be challenging to definitively say that one drug is more effective than another - except in head-to-head studies.
Eli Lilly's weight loss drug, Zebound, recently participated in a head-to-head trial against Wegovy and emerged as the undisputed victor in aiding individuals in losing weight.
Over the course of a 72-week trial, Zebound helped participants shed an average of over 20% of their body weight. Conversely, patients taking Wegovy shed approximately 13.8% of their body weight during the same period. Additionally, a greater proportion of participants experienced substantial weight loss with Eli Lilly's drug. More than 31% of individuals who took Zebound shed a quarter or more of their body weight, as compared to 16% with Wegovy.
While this comparison involved Wegovy rather than Ozempic directly, given that both drugs share the same active ingredient, semaglutide, this effectively establishes Zebound as a far more effective weight loss option than both Wegovy and Ozempic.
What does this imply for investors?
Though these trial results are excellent news for Eli Lilly, this does not mean that Novo Nordisk's stock is in danger. After all, there are shortages for weight loss drugs, and there's room for more than just a single drug. According to Goldman Sachs, the overall market for anti-obesity drugs could reach $100 billion by 2030.
Another pertinent factor is the individual responses to these treatments. While Zebound may be more successful in aiding weight loss, some individuals may prefer Wegovy due to encountering fewer side effects with the drug or simply finding it easier to take. There's no one-size-fits-all drug for individuals seeking to lose weight.
The study might help Zebound gain more prominence and recognition among patients. Furthermore, with doctors having a clear head-to-head study to rely on, they may be more likely to prescribe it for patients who require an aggressive weight loss option.
Both of these stocks continue to be compelling investments
Eli Lilly and Novo Nordisk are both highly successful and profitable companies to invest in. However, investors should also consider valuation. Currently, Eli Lilly stock trades at a price-to-earnings ratio of 84, whereas investors only need to pay a multiple of 36 times earnings for Novo Nordisk.
The better growth stock for investors might be Eli Lilly due to Zebound's success, but if you're seeking a more reasonably priced option, then Novo Nordisk could still be a worthwhile addition to your portfolio.
In light of the trial results, investors might want to consider diversifying their finance portfolio to include Eli Lilly stocks, given Zebound's effectiveness in aiding weight loss compared to Wegovy and Ozempic. However, the competitive market for weight loss drugs ensures that Novo Nordisk's stocks, despite a lower price-to-earnings ratio, remain a promising investment opportunity for those who prioritize value over growth. Investors can potentially benefit from both companies' strong financial positions and the growing anti-obesity drug market, which Goldman Sachas predicts could reach $100 billion by 2030.