As Eli Lilly's weight-loss drug, tirzepatide, gains traction in the U.S. against Novo Nordisk's semaglutide, physicians are faced with a pragmatic decision: which medication is more readily available for their patients at the pharmacy?
Since its launch in December, Lilly has captured approximately 40% of the U.S. market, with tirzepatide prescriptions reaching 130,000 for the week ending July 19, compared to 200,000 for semaglutide, based on IQVIA data.
Clinical trials indicate that tirzepatide results in slightly higher average weight loss compared to semaglutide, influencing some patients to prefer the Lilly product. However, both companies are struggling to meet the high demand for these weekly injectable treatments.
"The reality we live in right now is that we are beholden to these supply issues," stated Eduardo Grunvald, MD, an obesity medicine physician at the University of California, San Diego.
Five U.S. obesity specialists informed Reuters that they prescribe whichever drug is available at the time, even if it necessitates patients switching between treatments to maintain continuity.
Investors are keenly awaiting supply updates from Novo and Lilly as the companies report their quarterly results this week.
“While we will do our best to support those who want to start taking semaglutide, it is important to recognize that overall demand will continue to exceed supply and some patients may still have difficulty filling semaglutide prescriptions,” Novo stated on its website.
Lilly's CEO recently indicated that the shortage of tirzepatide would resolve "very soon." The FDA updated its website on Friday to confirm tirzepatide's availability but did not remove it from the shortage list, noting ongoing efforts with Lilly to stabilize supplies.
Market analysts project that the market for new weight-loss drugs could reach $150 billion annually by the early 2030s. Both companies are investing billions to expand manufacturing capabilities, including building new facilities and securing additional contracts with third-party manufacturers.
Additionally, both companies are launching their treatments in new markets, including the U.K., Germany, Saudi Arabia, and the U.A.E. for Lilly, and Australia, Canada, and Spain for Novo. However, the U.S. market, where over 70% of adults are obese or overweight, remains the most lucrative.
Supply vs. Demand
"For both companies, the real driver of results right now is a supply question rather than a demand one," said Nicholas Anderson, Managing Director at Thornburg Investment Management.
Currently, three out of five dose strengths of semaglutide remain in shortage, according to the FDA.
Since the start of Q2 2024, Novo Nordisk has filled an average of nearly 170,000 U.S. semaglutide prescriptions weekly, while Lilly has averaged just under 100,000, as reported by analysts using IQVIA data.
Analysts predict a roughly 50-50 market split between the two companies by the end of 2024 as Lilly ramps up production. This parity may persist until supply issues are resolved, at which point greater demand for tirzepatide could potentially give Eli Lilly an edge.
The market dynamics could shift further with the introduction of more effective or convenient formulations, such as a pill equivalent to the current injectables.
In the meantime, patient preferences are beginning to lean towards tirzepatide due to its perceived efficacy, noted Robert Kushner, MD, of Northwestern University’s Feinberg School of Medicine, who disclosed receiving payments from both companies in 2023.
"That info is starting to get out," Kushner said of tirzepatide's potential for greater weight loss. "But when I explain the supply constraints for both medicines, patients quickly realize their options depend on availability, making it impossible to shop around."