Novo Nordisk and Eli Lilly's weight loss drug dominance could be challenged by newer rivals from Amgen.

• The dominance of Novo Nordisk and Eli Lilly in the weight loss drug market may be challenged by powerful competitors in the future.
• Weight loss treatments are being rapidly developed by drugmakers, including Amgen, who is leading the pack.
• Encouraging progress is being made by Viking Therapeutics, Altimmune, Structure Therapeutics, AstraZeneca, and their partners Boehringer Ingelheim and Zealand Pharma on their experimental drugs.

The weight loss drug market has been dominated by two companies for a long time, but a new competitor is getting closer to challenging their dominance.

The company is pushing forward with trials for its experimental obesity injection, which could give it an advantage in the market race with other drugmakers.

MariTide, Amgen's drug, is less frequently taken than Wegovy and Zepbound, the market leaders, but may cause longer-lasting weight loss. Amgen's advantage lies in its ability to produce drugs at scale, a significant edge over smaller biotech companies.

Amgen has a chance to disrupt and challenge Eli Lilly and Novo in the market, despite competition from both small and large players, according to William Blair & Company analyst Matt Phipps, who spoke to CNBC.

Since CEO Bob Bradley stated on Thursday that he was "very encouraged" by an ongoing mid-stage study on MariTide, Amgen's shares have increased by 12%. However, it is not the only company with the potential to disrupt the market.

Boehringer Ingelheim, Zealand Pharma, Novo Nordisk, and Eli Lilly are making progress on their own treatments and new weight loss drugs, respectively.

Phipps stated that he is uncertain if he is prepared to select another clear victor based on the available information.

Despite challenges such as supply shortages and limited insurance coverage, the demand for Wegovy and Zepbound is expected to remain strong, providing opportunities for new entrants in the rapidly growing weight loss market, which is projected to reach $100 billion by the end of the decade.

Although Amgen is in a favorable position, it will take several years for MariTide to reach patients. The company has not disclosed an estimated launch date for its obesity injection. According to a research note by JPMorgan analyst Chris Schott, it is predicted to hit the market in 2028.

Amgen appears to have a competitive edge

Amgen is exploring the possibility of administering its drug less frequently, such as once a month, to make it more convenient for patients compared to the weekly medications currently available. Several pharmaceutical companies are currently developing weekly injections or daily pills, but some have not yet ruled out the possibility of testing less frequent dosing for their drugs.

The study found that MariTide sustained weight loss after a single injection or multiple shots during a phase one trial, allowing for less frequent doses of the drug. Additionally, the company's drug can remain in the body for a longer period of time than current therapies, according to the authors.

Phipps expressed confidence that patients can maintain weight loss with MariTide even if they take it less frequently, such as once a quarter, without needing to increase the dosage. This could simplify manufacturing for Amgen and prevent the supply shortage problem experienced by Novo Nordisk and Eli Lilly.

Executives announced during an earnings call last week that Amgen is already beginning to increase its manufacturing capabilities for MariTide.

Phipps observed that taking less frequent doses of MariTide may result in fewer side effects compared to other weight loss treatments. Many patients discontinue their medication due to nausea and vomiting.

Phipps stated that while MariTide shares some of the same side effects, taking the drug on a monthly or quarterly basis instead of weekly could reduce the number of days of feeling sick, which could help patients adhere to treatment and maintain weight loss.

Phipps stated that even if patients experience nausea occasionally, having it occur once a quarter instead of once a week is a significant improvement in keeping them on track.

Amgen's treatment regulates appetite by activating a gut hormone receptor called GLP-1.

Zepbound activates a second hormone receptor called GIP, while Amgen's drug blocks it. In contrast, Wegovy does not target GIP, but instead suppresses appetite like GLP-1 and may also improve how the body breaks down sugar and fat.

Despite Amgen's progress and rising stock, other companies are also making progress in bringing products to market. Here's an update on their progress.

Newer Novo Nordisk, Eli Lilly drugs on the way

Novo Nordisk and Eli Lilly are working on new drugs for weight loss and diabetes that could enhance their current offerings and enter the market ahead of MariTide and other experimental medications.

The drug CagriSema, developed by Novo Nordisk, is a weekly injection used to treat diabetes and obesity. It contains semaglutide, the active ingredient in Wegovy, along with an experimental drug called cagrilintide.

CagriSema helped overweight or obese diabetes patients lose 15.6% of their weight at 32 weeks in a mid-stage trial. Novo Nordisk is currently studying CagriSema in six late-stage clinical trials and could release data from a 68-week study in obese patients later this year.

Eli Lilly is currently examining an experimental drug named retatrutide in a late-stage trial. In a mid-stage trial, this treatment helped patients shed up to 24% of their weight after nearly a year, establishing a new benchmark for weight loss.

The combination of retatrutide mimicking GLP-1, GIP, and glucagon appears to be even more effective at reducing a person's appetite.

Eli Lilly is also working on an oral medication called orforglipron, which targets GLP-1. The company plans to release late-stage trial data on both the pill and retatrutide in 2025.

Boehringer Ingelheim, Zealand Pharma injection

Boehringer Ingelheim and Zealand Pharma are among the potential entrants developing a weekly weight loss injection that targets GLP-1 to suppress appetite and glucagon to increase energy expenditure.

In August, Boehringer Ingelheim announced that it was moving the drug, known as survodutide, into a late-stage study. The mid-stage trial had shown that patients who were overweight or had obesity lost up to 19% of their weight after 46 weeks of treatment with the drug.

In February, the companies released positive mid-stage trial data on survodutide for patients with a severe form of liver disease.

According to a Reuters interview, Boehringer Ingelheim aims to launch survodutide as a treatment for obesity or liver disease in 2027 or 2028, provided that trial data is positive.

AstraZeneca and Pfizer pills

Eccogene, a Chinese biotech company, is partnering with AstraZeneca to develop a daily obesity pill called ECC5004.

The pill is quickly absorbed and doesn't remain in the stomach for long, which may decrease side effects compared to existing treatments. Additionally, patients can take the pill alone or with other oral medications, such as Farxiga, to treat obesity and related health problems.

The drug that targets GLP-1 is not yet available in the market, as the company has only completed a phase one trial in patients with diabetes and plans to present the data at a medical conference later this year, according to executives during an earnings call in April.

In an early-stage trial is AstraZeneca's experimental obesity drug AZD6234, which targets another gut hormone called amylin. The company hopes it can combine AZD6234 with its oral GLP-1 to help patients achieve greater weight loss than with existing drugs, as stated by AstraZeneca CEO Pascal Soriot in November.

The fate of Pfizer in the weight loss drug market will be determined by new data on its once-daily obesity pill, which is expected to be released around the middle of the year. The company previously abandoned its twice-a-day version of the drug, danuglipron, in December due to patients' difficulty tolerating it in a trial.

If Pfizer acquires a smaller obesity drugmaker, it may have another chance to enter the market. However, dealmaking seems unlikely at the moment as the company focuses on recovering from the decline of its Covid business last year.

During an earnings call last week, Pfizer CFO David Denton stated that in the near term, the company would not anticipate making many bolt-on acquisitions.

Smaller biotechs show promise

The three smaller pharmaceutical companies, Viking Therapeutics, Altimmune, and Structure Therapeutics, have garnered significant attention for their weight loss drug pipelines. Despite having fewer resources and manufacturing capacity compared to Amgen and Pfizer, they could attract more resources if acquired by a larger drugmaker.

In March, Viking Therapeutics released preliminary data from a mid-stage trial of its experimental injection, which targets GLP-1 and GIP. Patients who received weekly doses of the treatment lost up to 13.1% of their weight compared to those who received a placebo after 13 weeks.

Viking is likely to conduct another phase two trial that could take six to nine months, according to CEO Brian Lian during an investor call in March. Jefferies analyst Akash Tewari wrote in a note the same month that Viking's treatment is unlikely to hit the market until 2029 or later.

In March, Viking announced plans to commence a phase two trial of its oral drug following positive results from a small study.

Although Structure Therapeutics is working on an oral GLP-1 for obesity and diabetes, the company failed to meet Wall Street's expectations for weight loss in a mid-stage trial in December.

Patients who took the pill lost about 5% of their weight after eight weeks, compared to those who received a placebo.

The company anticipates obtaining complete results from patients with obesity in the second quarter of this year. It plans to commence a larger mid-stage study in the second half of this year and a late-stage trial in 2026.

Pemvidutide, a weekly obesity injection developed by Altimmune, targets GLP-1 and glucagon.

In March, Altimmune disclosed additional data from its mid-stage trial, revealing that its drug reduced the loss of muscle mass, a negative side effect of existing weight loss injections, while causing an average weight loss of 15.6% after 48 weeks.

The Food and Drug Administration will meet with Altimmune in the second half of the year to discuss the injection's future.