GLP-1s are All the Rage - Let's Dig Into That
- Jonathan Poyer
- 11 minutes ago
- 2 min read
For a wonderful read about what GLP-1s are and how they work, Kennedy Capital has a starter resource here:
Novo Nordisk (NVO) and Eli Lilly (LLY) are the established and largest leaders in the GLP-1 space. There are other entities worth keeping an eye on who have clear, direct GLP-1 exposure. Amgen (AMGN), AstraZeneca (AZN), and Sanofi (SNY) have direct exposure and Icon (ICLR) and IQVIA (IQV) have indirect exposure:
Amgen has the most strategically meaningful pipeline exposure through Phase 3 obesity candidate MariTide.
AstraZeneca has multiple investigational GLP-1 programs, including oral and combination approaches.
Sanofi has commercial GLP-1 exposure, but it is a relatively mature diabetes franchise rather than a leading obesity-growth platform.
ICON and IQVIA have indirect service exposure by supporting GLP-1 clinical trials, data, commercialization and market-access work; they do not own GLP-1 drugs.
The GLP-1 space is SO crowded!
Viking Therapeutics (VKTX) has an injectable and oral with potential monthly dosing of a GLP-1 and a GLP-1/GIP dual agonist, plus they’re developing an Amylin analog now as well, which is another shot at the same pathway of reducing appetite/slowing gut motility.
Structure Therapeutics (GPCR) is all oral, so operating with a different competitive landscape, but so far has very good efficacy data.
The big issue for both these stocks is the ever-declining price x ever-increasing reach of LLY/NVO products. The combination of having an entrenched competitor that is priced very affordable makes developing these drugs with large Ph. 3 trials less financially feasible. However, both companies have Ph. 3s underway and it’ll be exciting to compare their 50+ week weight loss numbers next year!
ICON explicitly describes conducting Phase 1 GLP-1/amylin studies and other GLP-1 clinical programs.
IQVIA publishes and provides analytics around GLP-1 prescribing, access, adherence, compounding and commercialization. That gives it some benefit from industry activity, but it does not own the underlying drugs.
What about the Investment Opportunity for LLY:
LLY: GLP-1 adoption. The tailwinds this year are real, including Medicare expansion and the oral launch. But we'd argue that's largely reflected in the share price. The swing factor is 2027 and beyond: in our opinion, LLY needs to keep growing double digits from 2027 through 2030 to have meaningful upside from here. Our belief is that’s possible in 2027, maybe 2028, but growth eventually slows on pricing, competition, or tough comps.
Capital deployment. LLY generates significant cash and is highly acquisitive, and that war chest is a real strategic advantage. But to justify upside from current levels, you must believe the pipeline and M&A convert into sustained high single digit to double digit growth into 2030 and beyond. In short, they need to show investors what the next leg is after GLP-1s. They may well show that over time, but in our view the risk reward is more compelling elsewhere in the portfolio. We're always reassessing as new information comes in, but that's our current thinking.
We do a deep dive with the team from Kennedy Capital here:
If you would like to read more about what investment opportunities might exist in weight-loss that are not GLP-1, here is another great Kennedy Capital resource:
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