Investors eye obesity drug market with Novo Nordisk and Eli Lilly leading, but caution on valuations.
From Morningstar: 2024-05-31 06:25:00
Pharmaceutical investors are closely watching the obesity drug market, as Novo Nordisk and Eli Lilly lead the race with their respective products. Both companies have seen significant stock gains, with potential for massive growth in this market. Morningstar analysts caution that both stocks are currently trading in overvalued territory. Other major pharmaceutical companies like Roche, Pfizer, and Amgen are also looking to gain traction in the obesity drug market. Novo Nordisk and Eli Lilly have revolutionized the landscape of weight-loss therapy and are considered strong players in this market.
Global sales of obesity drugs are projected to reach $120 billion by 2031, with a significant portion expected to be split between Novo Nordisk and Eli Lilly. The market for GLP-1 therapies, including obesity drugs, is seen as even larger at $170 billion. While Novo and Lilly dominate this market, intense competition and pricing variables could impact their sales projections.
Investors must consider pricing, competition, and efficacy when deciding which obesity drug stocks to buy. Lilly and Novo are recognized as strong players, but valuations suggest that both stocks are overvalued. Pfizer and Amgen are also contenders in the obesity drug market, with potential for growth based on upcoming data releases and product offerings.
Lilly is expected to increase production of its obesity drugs to meet high demand, while Novo faces capacity constraints. Pfizer has faced challenges with lower-than-expected 2024 guidance but remains undervalued. Amgen is entering the obesity market with promising phase 1 data, positioning itself as a potential competitor. Roche, on the other hand, has acquired a biotechnology company to expand its presence in the obesity drug market.
Investors seeking to capitalize on the obesity drug market should carefully consider each company’s position and future prospects before making investment decisions. With the potential for substantial growth and competition increasing, the obesity drug market presents unique opportunities for pharmaceutical investors.
Read more at Morningstar: Obesity Drug Stocks: Where to Invest Now