Gaining Through Weight Loss: The Opportunity for Investors as Ozempic, Mounjaro Tackle Obesity

“In two decades I've lost a total of 789 pounds. I should be hanging from a charm bracelet.” ~ Erma Bombeck

Obesity is a U.S. and global public-health problem. The global obesity rate has nearly doubled since 1980, and the World Health Organization estimates that nearly 1 billion people (adults, adolescents, and children) are obese. Some scientists project that by 2030, one in five women and one in seven men will be categorized as obese. Within the U.S., one in three adults is categorized as obese, and one in six children as well. (Obesity is officially defined as having a Body Mass Index of 30 or higher)

Gaining Through Weight Loss: The Opportunity for Investors as Ozempic, Mounjaro Tackle Obesity

Medical costs for people with obesity in the U.S. tend to be 30% to 40% higher than those for people without obesity – double the percentage attributable to cigarette smoking. Obesity accounts for 20% or more of the $4.5 trillion in annual U.S. healthcare expenditures – approximately $900 billion. 

While these statistics might not be common knowledge, the health consequences of obesity are. As a result, multiple sub-industries – specialty food, fitness, and supplements, for example – have arisen to help everyday men and women lose weight and improve their health – though climbing obesity rates suggest limited success.

That appears to have changed in the past year, with those industries having been disrupted by the introduction of a new product: incretin mimetics, or synthetic incretins. (Incretins are a class of hormones produced by the body during the digestive process. Absorbed into the bloodstream, they travel to the brain and other organs, where they activate areas that promote insulin production and the feeling of satiety.)

Arguably the better-known synthesized incretin on the market is semaglutide. Novo Nordisk (NVO -1.94% ) first developed semaglutide as a treatment for Type II diabetes. Clinical trials began in 2016 and the treatment earned FDA approval the next year. Semaglutide is synthesized using recombinant DNA and works to stimulate the part of the brain that normally responds to the incretin GLP-1 (Glucagon-Like Peptide 1). Like GLP-1, semaglutide tells the brain to trigger the production of insulin.

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