The booming weight loss drug market may soon become more competitive as these companies attempt to enter the space.

• Pharmaceutical companies are rushing to enter the competition to produce popular weight loss medications.
• While larger companies like Pfizer and Merck dominate the pharmaceutical industry, there are still lesser-known competitors such as Boehringer Ingelheim and smaller public companies like Terns Pharmaceuticals, Viking Therapeutics, and Structure Therapeutics that pose a threat.
• The focus of Wall Street has been on major drug companies like Novo Nordisk and Eli Lilly, as well as large pharmaceutical companies such as Pfizer, Roche, and Amgen, hoping to enter the market.

Pharmaceutical companies are rushing to compete for the top spot in the market for widely used weight loss medications, with potential profits reaching into the billions within the next ten years.

Boehringer Ingelheim and smaller public companies like Novo Nordisk and Shionogi are hopefuls for the lesser-known weight loss drug segment, as demand is only expected to grow.

By 2030, it is predicted that 15 million U.S. adults will be taking obesity medications, providing a significant opportunity for new entrants in the market.

Last week, during the JPMorgan Healthcare Conference in San Francisco, the two leading companies in the weight loss drug industry discussed their expectations for the year. The demand for their blockbuster weight loss drugs increased, resulting in shortages over the past year. These treatments have been successful in helping patients lose significant amounts of weight over time.

Other major pharmaceutical companies, including the one with a well-known but unsuccessful weight loss drug program, and another, also disclosed their plans to enter the market.

While larger companies have dominated the weight loss drug industry, smaller companies with similar ambitions have received less attention. However, they may soon challenge the larger players in the market.

Here are some of the lesser-known businesses angling to enter the market.

Boehringer Ingelheim

Zealand Pharma, which has been working on obesity treatments for nearly a decade, is collaborating with Boehringer Ingelheim to develop a weight loss drug.

The drug they are testing reduces hunger and boosts energy by targeting two gut hormones, GLP-1 and glucagon. Some well-known weight loss medications, like Wegovy from Novo Nordisk, only focus on GLP-1.

In August, Boehringer Ingelheim announced that it was advancing the drug survodutide into a late-stage study, bringing it closer to potential FDA approval. The mid-stage trial showed that patients who are overweight or have obesity lost up to 19% of their weight after 46 weeks of treatment with the drug.

According to Zealand Pharma, the weight loss in a phase three trial could range from 20% to 25%. However, the exact timeline for regulatory approval of the product is uncertain.

Terns Pharmaceuticals

Large pharmaceutical companies could eventually acquire smaller drugmakers that develop weight loss drugs.

Boehringer Ingelheim is not as early in the development process as Terns Pharmaceuticals.

The company is currently conducting an early-stage trial of its oral weight loss drug, which targets GLP-1, in overweight or obese patients. This drug is expected to be easier for patients to take and for companies to manufacture compared to existing weight loss injections.

Erin Quirk, Terns Pharmaceuticals' head of research and development, stated during the conference that the company anticipates releasing initial 28-day data from the trial in the second half of 2024.

Terns acknowledged that it may be challenging to differentiate its weight loss pill from other drugs on the market. However, Quirk emphasized that even if it's not the best, analysts predict that this could be a $100 billion market. If Terns can capture just 1% of that market, it would result in a $1 billion drug.

Small biotech companies make moves

Eli Lilly's weight loss and diabetes drugs, Zepbound and Mounjaro, target the same hormones, GLP-1 and GIP, as other small drugmakers like Viking Therapeutics are developing drugs for.

The weight loss injection from Viking Therapeutics is expected to have mid-stage trial data released in the first half of the year. An early-stage study on this drug demonstrated a weight loss of up to 7.8% after 28 days.

The company plans to release phase one trial data for an oral version of its weight loss drug in the first quarter of the year.

An obesity pill is being developed by Structure Therapeutics, but it did not meet Wall Street's expectations for weight loss in a mid-stage trial last month.

After eight weeks, obese patients who received an oral drug lost about 5% of their weight, while those who received a placebo lost only about 3%. Before this data was published, Jefferies analyst Roger Song had predicted that patients would lose between 6% and 7% of their weight relative to a placebo.

The company anticipates obtaining complete results from patients with obesity in the second quarter of this year. It plans to conduct a larger mid-stage study in the second half of 2024 and a late-stage trial in 2026.

Altimmune is also developing an experimental obesity injection called pemvidutide, which targets GLP-1 and glucagon. Since Nov. 30, the company's stock has jumped nearly 250% after releasing mid-stage trial data showing that its drug caused an average weight loss of 15.6% after 48 weeks.

Potential players down the line

Some weight loss drug market entry signals were given by large drugmakers.

The French company, which experienced failure of its GLP-1 drug in a mid-stage trial five years ago, may consider exploring potential "next-generation" weight loss drugs with potential benefits over existing treatments, such as fewer side effects, according to executives who spoke to industry news publication Endpoint News at the JPMorgan Healthcare conference.

Sanofi CEO Paul Hudson stated, "Our company, like many others, is highly determined to predict what the second wave will bring."

Stefan Oelrich, the pharmaceuticals head of the company, stated in an interview during the conference that the company is reluctant to enter the obesity market independently but may collaborate with other companies.