Source:https://www.goldmansachs.com/insights/articles/anti-obesity-drug-market

Earlier this year, the global market for anti-obesity medications (AOMs) reached $6 billion on an annualized basis. By 2030, it could grow by more than 16 times to $100 billion, according to Goldman Sachs Research.

Obesity, defined as abnormal or excessive fat accumulation that presents a risk to both physical and mental health, has almost tripled around the world since 1975, according to the World Health Organization. Today, it’s the fifth-leading risk factor cited by the WHO for contributing as a primary cause of death globally. Driven by factors including eating patterns, levels of physical activity, and genetics, obesity rates are forecast to keep rising. Based on current trends, over half of the global population will be overweight or obese by 2035, compared to 38% in 2020, according to a World Obesity Atlas 2023 forecast.

Our researchers’ forecast for a $100 billion market is based on a range of drivers for AOM sales, including the total addressable patient population. They estimate that about 15 million adults in the US alone may be treated with AOMs by 2030, representing approximately 13% penetration of the eligible US obese/overweight adult population. Other factors likely to drive sales include rates of insurance reimbursement, the duration of use among patients, and drug pricing. Eli Lilly and Novo Nordisk are expected to be two of the dominant AOM makers.

“The obesity market is still in its early stages,” Chris Shibutani, senior biopharmaceuticals analyst in Goldman Sachs Research, writes in the team’s report, noting there are uncertainties around the assumptions in the team’s model. The $100 billion forecast is “relatively sensitive to minor tweaks to underlying drivers.”

In 2013, the American Medical Association recognized obesity as a chronic disease, which in turn raised awareness on a range of medical interventions required for treatment and prevention. Early generation therapies offered only modest help — 3% to 11% body weight reduction. And some early generation AOMs were found to have safety concerns and were removed or recommended for suspension from their markets in the US and Europe.

But in recent years, a new class of drugs, incretin-mimetics, have proven more effective, achieving weight loss up to the mid-20% range. Led by glucagon-like peptide 1 (GLP-1) receptor agonists, the drugs stimulate key receptors in the gastrointestinal tract and brain to promote insulin synthesis (which helps regulate healthy metabolism and blood glucose levels) and decrease feelings of hunger, among other functions. There are indications that the next generation of AOMs may deliver even better results, according to Goldman Sachs Research.

“The chronic weight management market is undergoing an inflection, in our view, with potential for solid growth ahead and a peak opportunity that, by our estimates, could ultimately yield some of the highest grossing drugs of all time,” Shibutani writes.

Reducing obesity rates could not only improve overall health but also relieve some of the economic burden caused by the disease, according to Goldman Sachs Research. The Centers for Disease Control and Prevention estimates that obesity-related medical costs in the US were about $173 billion in 2019. The World Obesity Atlas estimates that the total costs attached to obesity – both healthcare and productivity related – will exceed $4 trillion worldwide by 2035, or about 3% of global GDP. Data show that annual health-related spending and out-of-pocket costs are much higher for those who have been diagnosed with the disease.