Another key event in 2024 was the readout of the first head-to-head trial in obesity, Lilly’s SURMOUNT-5, pitting tirzepatide against semaglutide, with the former demonstrating superior weight loss. While this result was widely expected, it does define a new era of competitiveness and serves as a harbinger of things to come in a market that will become much more crowded, as numerous competitors are lining up to claim their share of the obesity opportunity.

Investors’ excitement about the huge potential of novel AOMs propelled the valuations of Novo Nordisk and Lilly to record levels in 2024, with Lilly’s market cap reaching an all-time high of $912Bn on 30th August, the closest any biopharma company has come to the exclusive $1-trillion valuation. Similarly, many biotech companies enjoyed an ‘obesity halo’, offering benefits in the ability to attract funds, boost company valuations or command a deal premium as an acquisition target. On the flipside, obesity companies’ share prices have become highly sensitive to any news flow.

Against this backdrop of investor exuberance, 2024 also delivered a dose of realism to temper runaway excitement about many novel AOM assets’ purported ‘best-in-class’ profile, often based on nothing more than limited topline data from phase 1 trials. Unsurprisingly, not every new AOM asset delivered on those expectations in subsequent phase 2 or phase 3 trials, let alone setting ever more spectacular benchmarks for weight loss, while investors increasingly recognised the importance of a clean tolerability profile alongside compelling efficacy [1].

Arguably, this may signal the beginning of an overdue shakeout as we start moving past ‘peak hype’ in obesity.

Outlook for obesity in 2025

Looking ahead to 2025, a number of key events will shape the future direction of the AOM market:

• Obesity definition: The Lancet Commission on Diagnostic Criteria of Clinical Obesity is expected to report its recommendations in early 2025. At its heart will be a move away from relying on overly simplistic BMI, which does not account for a person’s gender, age or body composition of fat vs. muscle, for example. Instead, the Lancet Commission is looking to define more appropriate, scientifically sound and pragmatic criteria for the diagnosis of clinical obesity as a disease state, not a risk factor. These recommendations will have far reaching implications for how obesity is viewed, for clinical decision-making, including potential updates to treatment guidelines, and the criteria payers may apply to cover AOMs. In a parallel development, already in 2024 both Novo Nordisk and Lilly dropped BMI ranges from their respective FDA labels for Wegovy and Zepbound, just leaving the reference to obese and overweight patients.
• Innovation: The current AOM pipeline comprises 157 clinical-stage assets, including 7 in phase 3, and spans over 60 mechanisms of action, while 43% of all AOM assets are oral therapies (see Figure 2). As these assets progress through the pipeline, innovators will need to navigate an increasingly crowded field and seek differentiation on multiple dimensions, including efficacy, tolerability, convenience, durability and quality of weight loss that distinguishes between fat vs. lean mass.

Several mid-stage trials will read out in 2025 to provide important proof points for novel MoAs and their potential for differentiation, e.g.,

• Lilly’s bimagrumab (activin/myostatin type II receptor inhibitor) in combination with semaglutide, aiming to deliver weight loss while preserving muscle mass (phase 2b).
• Lilly’s eloralintide (amylin receptor agonist), providing a potential option for Lilly to defend against amylin analogues, including Novo Nordisk’s CagriSema, which combines dual amylin and calcitonin receptor agonist cagrilintide and semaglutide, or Zealand’s petrelintide (phase 2)
• Structure Therapeutics’ GSBR-1290 (GLP-1), small molecule, oral obesity therapy, seeking to substantiate its earlier, positive phase 2a data to deliver competitive weight loss, against both other oral therapies and marketed injectables, with acceptable tolerability (phase 2b)

Crucially, a number of phase 3 readouts in 2025 for key AOM assets will set the stage for their launch in 2026, when the next wave of AOMs enter the market to re-shape the competitive landscape:

• Lilly’s orforglipron (GLP-1), one of the first oral AOMs to launch, possibly alongside oral semaglutide, and when it does, the first small molecule based therapy in the market. This feature gives it favourable manufacturing economics and allows for rapid production scale up.
• Boehringer Ingelheim’s survodutide (glucagon/GLP-1), the first new competitor to enter the market outside the dominant Novo Nordisk/Lilly duopoly.
• Novo Nordisk’s REDEFINE 4 head-to-head trial pitting its CagriSema (GLP-1/amylin) against tirzepatide, with the aim to demonstrate superior weight loss against the most potent marketed AOM to date and establish Novo Nordisk as a player in the mid-20% weight loss league. Following the readout of REDEFINE 1 in late 2024 which fell short of expectations, positive REDEFINE 4 data will become even more important for CagriSema, however, its outcome is now less certain.

Other noteworthy phase 3 trial readouts in 2025 include:

• Novo Nordisk’s evoke/evoke+, investigating oral semaglutide in patients with early Alzheimer’s disease, potentially expanding the utility of GLP-1s beyond cardiometabolic indications. A trial emulation using U.S. real-world data found semaglutide was associated with 40% to 70% reduced risks of first-time Alzheimer’s diagnosis in T2D patients compared to other antidiabetic medications [2]. If evoke/evoke+ were to confirm such an effect size, it would position semaglutide as a novel modality offering several potential advantages over anti-amyloid therapies such as Lilly’s donanemab, e.g., oral formulation, simpler diagnostics, likely no need for PET scan monitoring. Thus, the evoke/evoke+ trials could provide a much needed catalyst for Novo Nordisk, especially following the questions raised by REDEFINE 1 around CagriSema, despite the latter delivering perfectly reasonable weight loss.
• Lilly’s SURPASS-CVOT, providing the first CV-outcomes data for tirzepatide, albeit in T2D patients with established atherosclerotic CV disease and in H2H comparison vs. dulaglutide (Trulicity). As such, this data is not directly comparable to Wegovy’s SELECT.

• Supply: In 2025, supply bottlenecks will continue to ease following extensive efforts by Novo Nordisk and Lilly to step up manufacturing, with important implications for competitive dynamics:
  
  
  
  • The large-scale opportunity for compounders will be closing. On 19 December 2024, the FDA removed tirzepatide from its official drug shortage list, with semaglutide expected to follow in 2025 [3]. The FDA is offering a 60- to 90-day grace period before compounders have to stop manufacturing tirzepatide to minimise disruption for patients.
    A recent agreement between Lilly and U.S. telehealth platform Ro allows the latter to provide Zepbound via its app [4]. This suggests Ro, one of the major platforms providing compounded versions of weight loss drugs, is preparing for a post-shortages future.
  • In a market not held back by concerns about failing to meet patient demand, conventional competitive dynamics will prevail. We should expect Novo Nordisk and Lilly to increase competitive intensity in 2025, while more markets will see head-on competition between the two as better supply allows semaglutide and tirzepatide to be launched in more countries.
• Reimbursement: This year will see some expansion of reimbursement of AOMs.
  
  
  
  • As 2024 drew to a close, England’s NICE finalised its guidance for Mounjaro, recommending its use in the primary care setting, for treating adults with a body mass index (BMI) ≥35 kg/m2 and at least one weight-related co-morbidity, alongside a reduced-calorie diet and increased exercise, with no restriction on treatment duration, equating to a total eligible population of 3.4 million patients [5].
    Implementation guidance for NHS England proposes a phased rollout of Mounjaro which prioritises patients in greatest need, with an ultimate goal of treating 220,000 patients with Mounjaro in the first three years [6]. NHS England is developing more specific guidance on clinical prioritisation in early 2025 in preparation for implementing this programme. Learnings from this initial 3-year phase will inform the rollout to a wider group of eligible patients over a maximum period of 12 years.
    This agreement sets a precedent and may serve as a possible blueprint for other publicly funded health systems, in Europe and elsewhere, pondering over reimbursement of AOMs.
  • In the U.S., CMS guidance from March 2024 allows Medicare Part D coverage of AOMs with medically accepted indications, such as diabetes or reducing the risk of major adverse cardiovascular events in patients with established cardiovascular disease. As semaglutide and tirzepatide seek to expand their approved indications, e.g., potentially adding heart failure, chronic kidney disease or MASH, following several successful phase 3 trial readouts in 2023 and 2024, more pathways open up to Medicare reimbursement of AOMs within existing rules.
    It is worth noting the differences in approach to secondary indications by the FDA vs. EMA: While the FDA granted Wegovy an additional indication for CV risk reduction, the EMA did not deem this necessary and only added SELECT data to its label. Similarly, the EMA declined to grant Mounjaro an additional indication for obstructive sleep apnoea (OSA), unlike the FDA, instead only including data from relevant OSA trials in its label.
  • In late 2024, the Biden Administration proposed to significantly expand Medicare and Medicaid coverage of AOMs to include obese patients without co-morbidities. Such a move would provide access to AOMs for 7.4 million obese Americans enrolled in these government-funded programmes. However, it remains uncertain whether the incoming Trump administration would back this proposal, as opposing forces play out: different views on the merits of GLP-1s within the administration; concerns about budget impact of covering AOMs, estimated by CMS to cost federal and state governments $40Bn over a decade; vs. considerable public health benefits and the likely popularity of this policy with the American public.
• Real-world benefits: The perceptions of different AOMs and their value propositions are firming up in 2025, as more doctors gain hands-on experience with AOMs and we are beginning to see real-world outcomes:
  
  
  
  • Doctors’ awareness and perceptions of AOMs are still developing and vary considerably between prescriber specialties. In a survey of UK HCPs, for example, awareness of semaglutide and tirzepatide was high among specialists, including diabetologists, endocrinologists and cardiologist, whereas for more than 50% of primary care physicians surveyed the much older, less effective orlistat was top of mind [7].
  • In 2025, more healthcare professionals will gain greater experience in using AOMs in a fast expanding AOM market still driven by private prescriptions. When reimbursement expands, as in the earlier example of the NHS agreement for Mounjaro, an even wider group of doctors, in particular general practitioners (GPs), will be exposed to AOMs as prescribers. Their practical experience will shape perceptions of different AOMs and their relative benefits. In turn, this will inform doctors’ preferences for certain therapies, even brands, to treat specific patient profiles and thus shape the competitive dynamics in the AOM market.
  • Alongside doctors’ experience, real-world data on the use and value of AOMs will begin to accrue as more patients are treated, albeit predominately still in the private market. Such data may include AOM usage patterns and treatment persistence; real-world patient outcomes, e.g., weight loss achieved, its durability, impact on CV risk factors, safety and tolerability; and potentially early insight into health system impact, e.g., cost offsets, or trends in population-level outcomes related to obesity, e.g., prevalence, morbidity or mortality.
    Real-world persistence data will be particularly important to guide efforts for shoring up the chronic market opportunity, e.g., via digital health support programmes, such as the Omada Health-Evernorth partnership [8]. Preliminary data suggests fewer than 30% of patients are still on an AOM after 1 year, with abandonment and discontinuation rates highly sensitive to costs. For example, according to IQVIA data, in U.S. patient cohorts facing the highest out-of-pocket cost, 1-year AOM persistence drops below 10%. 
  • Lilly is preparing to harness the potential of formal real-world evidence for elevating AOMs as a priority with doctors, payers and policy makers. In October 2024, Lilly announced a partnership with Health Innovation Manchester and The University of Manchester to initiate a five-year real-world study, SURMOUNT-REAL UK [9]. It will evaluate the real-world effectiveness of tirzepatide in weight loss, prevention of diabetes and obesity-related complications, and also collect data on healthcare resource utilisation, health-related quality of life, participants’ employment status and sick days.

Innovators cannot afford to be bystanders as stakeholder perceptions of AOMs are being formed, especially with the AOM market at the cusp of becoming more crowded and competitive. Stepping up traditional promotional efforts and engagement by medical affairs will be critical to take control of their brand narrative in an expanding prescriber universe catching up with innovation, and as pre-launch activities for the next wave of AOMs will kick off during 2025.

As treated patient volumes continue to expand, innovators must also manage rebates and patient assistance very carefully to protect brand net margins.

Furthermore, with disconcertingly low persistence rates undermining the opportunity for longer term AOM treatment, behavioural support programmes utilising digital health tools will open up a new front-line for competition in 2025, with the need to demonstrate real-world impact on patient outcomes.

Final thoughts

The obesity market continues its spectacular ascent, and 2025 will be another momentous year in this remarkable journey. It will offer a glimpse into the future as key trends play out that will shape how obesity is viewed, diagnosed and treated, while healthcare systems grapple with this formidable challenge.

For obesity innovators, 2025 will mark a turning point as we move past ‘peak hype’ and see the beginning of more conventional competitive dynamics gradually establish themselves in the AOM market.

References

1. Tackling tolerability: The next challenge facing obesity therapies; IQVIA blog, October 2024: https://www.iqvia.com/locations/emea/blogs/2024/10/tackling-tolerability-the-next-challenge-facing-obesity-therapies
2. Wang et al, Associations of semaglutide with first-time diagnosis of Alzheimer's disease in patients with type 2 diabetes: Target trial emulation using nationwide real-world data in the US. Alzheimers Dement. 2024 Dec;20(12):8661-8672. https://doi.org/10.1002/alz.14313
3. FDA confirms shortage of weight loss drug tirzepatide is over, gives compounders a grace period; 19 December 2024: FDA confirms tirzepatide shortage is still over, gives compounders a grace period
4. Eli Lilly strikes Zepbound deal with Ro, amid questions about future of compounded GLP-1s; 11 December 2024: https://www.statnews.com/2024/12/11/eli-lilly-zepbound-ro-health-agreement-weight-loss/
5. NICE final guidance for Mounjaro, 23 December 2024: https://www.nice.org.uk/guidance/ta1026/resources/tirzepatide-for-managing-overweight-and-obesity-pdf
6. NHS agreement for phased rollout of Mounjaro in England, 4 December 2024: https://www.fiercepharma.com/pharma/only-highest-need-patients-england-will-get-lillys-tirzepatide-obesity-first-phase-rollout
7. Doctors and Obesity: Are healthcare professionals ready for the new anti-obesity medications? IQVIA blog, December 2024: https://www.iqvia.com/locations/emea/blogs/2024/12/doctors-and-obesity-are-healthcare-professionals-ready-for-the-new-anti-obesity-medications
8. GLP-1s and digital support: A winning combination; https://www.evernorth.com/articles/glp1s-digital-tools-weight-management
9. SURMOUNT-REAL UK, press release, 14 October 2024: Greater Manchester plans to partner with industry on a new study to deepen understanding of a weight loss medication - Health Innovation Manchester