Eli Lilly will apply for approval of an obesity drug that a late-stage study showed can slash a person’s body weight by almost a sixth, raising hopes for a new blockbuster treatment to tackle the global obesity epidemic.
The US drugmaker on Thursday said a high dose of its drug Tirzepatide helped people who have type 2 diabetes and are overweight or obese lose on average almost 16 per cent of their body weight, or 15.6 kilogrammes, over almost 17 months.
It was approved by the US Food and Drug Administration last May to treat type-2 diabetes under the brand name Mounjaro, but Lilly aims to tap the fast-growing market for weight loss treatments by getting the green light to market the drug to treat obesity.
A new class of obesity and diabetes drugs that in some cases can produce weight loss equivalent to bariatric surgery, is driving patient demand and investor excitement in the sector. Demand for the treatments has been fuelled by endorsements on social media by Hollywood stars and celebrities, including Elon Musk.
Mounjaro notched up almost $500mn in sales last year and on Thursday Lilly upgraded its 2023 profit forecasts because of strong demand for the diabetes drug, underlining its potential as a competitor to Novo Nordisk’s obesity drug Wegovy.
Analysts said the likely approval of the drug later this year to treat obesity would dramatically increase sales and could make Tirzepatide the highest-selling drug of all time, with analysts’ forecasts for annual peak sales stretching as high as $50bn.
Evan Seigerman, analyst at BMO Capital Markets, said trial results showed the “wait is over” and Mounjaro was on a path to regulatory approval and potential peak sales of more than $50bn across all indications.
“These data reinforce our view that Mounjaro is the best injectable option for weight loss, besting Novo’s Wegovy,” he added. “Once approved, we expect rapid uptake, given Lilly’s investment in manufacturing.”
Lilly shares rose almost 4 per cent on Thursday following the release of its financial and trial results.
Pharmaceutical companies are rushing to develop a new generation of drugs to tackle a growing crisis in the US, where two in five people suffer from obesity, according to data published by the Centers for Disease Control and Prevention.
The World Health Organization estimates about 650mn people suffer from obesity worldwide. Lilly’s Tirzepatide is administered once a week by injection and acts to suppress a person’s appetite and increase energy expenditure.
Lilly and Novo Nordisk still face a battle to convince public and private insurers to fund their obesity drugs. They argue obesity causes complications that can be more expensive down the line, but may face some pushback from insurers as the market is so large.
Lilly said it planned to complete its submission for approval of Tirzepatide for obesity in coming weeks and expected a decision by the FDA as early as late 2023.