Key Takeaways
- GLP-1 drugs such as semaglutide and tirzepatide have revolutionized healthcare as effective treatments for diabetes and obesity, leading to a surge in demand.
- GLP-1 supply shortages are negatively impacting diabetic patients who depend on these medications, underscoring the need for a sustainable approach to medication management.
- Stringent safety standards for compounded versions of GLP drugs are essential to fully harness the potential of these treatments while managing associated risks.
Recently, GLP-1 drugs like semaglutide (Ozempic and Wegovy) and tirzepatide (Mounjaro) have taken the healthcare world by storm, offering an almost miraculous solution to some of the most pressing medical issues affecting patients today. These glucagon-like peptide-1 receptor agonists work by enhancing the body’s natural insulin secretion and slowing gastric emptying, leading to improved blood sugar control and weight loss.
With the rising prevalence of diabetes and obesity worldwide, the demand for this treatment is higher than ever, positioning GLP-1 drugs as a critical component in the modern healthcare arsenal. As a result, the healthcare market appears to be on the cusp of a significant transformation. The efficacy of these medications in managing chronic conditions, coupled with a growing body of evidence supporting their use, suggests that these drugs could fundamentally alter treatment paradigms.
On the other hand, these drugs are still relatively new, and there are concerns that the immense popularity of the drug as a one-for-all cure has potentially shrouded the potential for serious side effects as well as the unpredictability of their supply.
Therapeutic Scope Of GLP-1
Historically, GLP-1 agonists have primarily been used to treat Type-2 diabetes. Type-2 diabetes is a chronic condition in which the body is unable to utilize insulin appropriately. A type-2 diabetes diagnosis significantly increases the risk for other life-threatening conditions such as heart disease, kidney disease, and stroke. According to the CDC, more than 38 million Americans have diabetes (about 1 in 10), and about 90% to 95% of them have type-2 diabetes, specifically.
“Ozempic is a very powerful medication with specific mechanisms that address diabetes better than most other drugs.”
Dr. Suzannah Gerber (Tufts Friedman School of Nutrition Science and Policy)
The Expansion Of Treatment
Recently, the discussion around GLP-1 drugs has been that they are extremely attractive treatments for other ailments as well.
Research has shown that GLP-1 agonists can significantly aid in weight loss by reducing appetite and slowing gastric emptying, making them highly effective for treating obesity. The benefits extend to cardiovascular health, as these drugs have been found to reduce the risk of major cardiovascular events, such as heart attacks and strokes, in patients with type-2 diabetes.
Emerging studies suggest that GLP-1 agonists might have a role in managing neurodegenerative conditions like Alzheimer’s disease. The neuroprotective effects observed in preclinical models indicate the potential for slowing cognitive decline.
Additionally, the influence of GLP-1 drugs on insulin resistance and inflammation could contribute to improving fertility outcomes in patients with polycystic ovary syndrome (PCOS).
Furthermore, the impact on behavior and mood regulation has opened up discussions on their use in treating compulsive behaviors, including nail-biting and potentially other forms of obsessive-compulsive disorders.
Figure 1 further illustrates how these drugs affect the body and, ultimately, health.
GLP-1 & The Healthcare Landscape
Given the scope of their application, it is no surprise then that GLP-1 drugs hold the potential to alter the healthcare landscape.
About 1.7% of people in the US have been prescribed a semaglutide medication in 2023, up 40-fold over the past five years, according to data shared with CNN by Epic Research that was based on an analysis of millions of electronic health records. These numbers are only projected to increase, leading some stakeholders to worry that the demand for medical devices, for instance, those now considered almost essential for diabetes management, will become somewhat obsolete. Furthermore, with more patients relying on GLP-1 medication for obesity-related problems, there is a risk of decreasing investment in health and fitness.
As a result, industries such as medical device manufacturers, biotechnology, health and wellness, and pharmaceuticals are scrambling to adapt to a transforming healthcare market.
A Threat To The Industry?
Analysts are divided. Some believe that GLP-1 medications and HealthTech can coexist, while others fear serious repercussions for the industry. The concerns are not unfounded. In 2023, HealthTech stocks faced a challenging year, with significant impacts due to economic headwinds, supply chain issues, and the rising popularity of GLP-1 drugs. The industry saw a substantial decline in public market valuations and financing, with overall Healthtech stock prices falling nearly 30% during a particularly volatile three-month period in mid-2023.
As the GLP-1 frenzy calmed down, a more optimistic future for HealthTech has emerged. To address investor concerns, several companies and their executives emphasized that GLP-1 drugs did not pose an immediate threat to their businesses.
- Stryker CEO Kevin Lobo reassured stakeholders during a Q3 earnings call, noting that GLP-1s could actually increase the number of patients eligible for knee surgery by helping them lose weight.
- Abbott executives were similarly optimistic, believing that the prevalence of GLP-1s could benefit their continuous glucose monitor business.
- Intuitive Surgical’s Chief Medical Officer, Dr. Myriam Curet, anticipated that patients considering bariatric surgery might try GLP-1 drugs first but would likely revert to surgical options within a year or two due to issues with compliance, cost, and side effects.
Similar effects are being observed in various other industries, leading to the conclusion that the hype around GLP-1 drugs might have been over-inflated. Despite growing fears of GLP-1 drugs overtaking certain markets, it is becoming clear that these drugs will need to be accompanied by the usual regimen of lifestyle modifications and medical treatments.
Potential Disruptions
When things seem too good to be true, there’s a chance they probably are. This is the dilemma currently facing the ‘magical’ GLP-1 drugs as the issues facing their usage and manufacturing become more clear.
A good case to observe this is through the company Hims & Hers, which specializes in men’s and women’s healthcare and offers a telemedicine service for various issues such as hair loss, anxiety, and depression. In May 2024, the company announced its plans to offer compounded GLP-1 weight loss injections that cost nearly 90% less than the average price at the time. Predictably, stocks for the company surged nearly 28%, reflecting investor enthusiasm for the company’s expansion into the lucrative weight-loss drug market.
However, despite their ambitious plans, it has not all been smooth sailing. The compounded GLP-1 injection has not received FDA approval. Plus, the FDA has received reports about the drug’s adverse effects, highlighting the need for caution. The lack of regulatory oversight of these knock-off compounded drugs and the potential for serious future side effects deter from their use. Prescribing medication requires a thorough review of a patient’s medical history, including current medications. Yet, online services that provide this compounded medication may circumvent the standard approach, posing patient safety issues.
One reason companies are seeking compounded alternatives is the massive supply shortages facing pharmaceutical giants Novo Nordisk (Ozempic and Wegovy) and Eli Lilly (Mounjaro and Zepbound). Various factors are leading to this shortage, such as rapidly increasing demand, supply chain issues, limited production capacity, etc.
The downstream effect of these shortages is the suffering borne by diabetic patients who have been using these classes of medications for two decades before their popularity skyrocketed for weight loss. According to Novo Nordisk’s CEO, it could take years to fulfill the demand for Ozempic and Wegovy. In the meantime, diabetic patients who have been prescribed GLP-1 drugs for managing their blood glucose levels are experiencing interruptions in their treatment regimens, with low-income patients affected the most. This disruption can lead to poorer glycemic control, increasing the risk of complications such as neuropathy, retinopathy, and cardiovascular diseases.
Figure 2 illustrates the declining share of patients prescribed semaglutide who have Type 2 diabetes (source CNN)
Final Thoughts
While GLP-1 drugs such as semaglutide and tirzepatide have ushered in a new era of hope for managing chronic conditions like diabetes and obesity, their meteoric rise has also exposed significant challenges and disruptions within the healthcare system.
The initial enthusiasm and rapid adoption of these medications highlight their potential to transform treatment paradigms, yet they also underscore the need for a balanced approach that considers the long-term implications, including side effects and supply chain constraints. The resulting shortages and market volatility reveal a delicate game of balance between innovation, regulatory oversight, and economic forces.
Moving forward, it is essential for stakeholders—ranging from healthcare providers and patients to pharmaceutical companies and regulators—to collaborate in addressing these challenges. Ensuring equitable access to these groundbreaking treatments while maintaining rigorous safety standards will be crucial to harnessing the full potential of GLP-1 drugs to improve public health outcomes sustainably.
Rida Zaneb
Rida is currently pursuing her B.A. in Mathematics and English at Kenyon College. She is deeply interested in the intersection between technological innovation and human connection.
