In recent years, the pharmaceutical industry has witnessed a remarkable surge in the development of weight loss medications, particularly GLP-1 receptor agonists such as Ozempic and Wegovy. The global obesity rate has nearly tripled since 1975 and is expected to affect over half the population by 2035, per WHO and Goldman Sachs. The global market for anti-obesity medications is expected to reach $50 billion by 2030.

As the prevalence of obesity rises, so do related chronic conditions such as diabetes, heart disease and hypertension, creating a massive market for treatments like GLP-1 drugs. Pioneering GLP-1 treatments, such as Ozempic, Wegovy and Zepbound, are now at the forefront of medical advancements in weight management.

Two companies — Eli Lilly LLY and Novo Nordisk NVO — dominate the weight-loss drug market and their stocks have surged in the recent past due to soaring demand for their products. There are a few other ways to play this market. Exchange-traded funds (ETFs) are the best ways to access this evolving market.

VanEck Pharmaceutical ETF PPH, Obesity & Cardiometabolic ETF HRTS, and Amplify Weight Loss Drug & Treatment ETF THNR are the ETFs to play this emerging market.

What Are GLP-1 Receptor Agonists?

GLP-1 medications, initially used to treat diabetes, were later discovered to suppress appetite and lead to considerable weight loss. Recent studies suggest that GLP-1 drugs may also slow the progression of Parkinson’s symptoms in humans and lower the risk of heart attack, stroke and cardiovascular death by approximately 20%. GLP-1 (Glucagon-Like Peptide-1) receptor agonists, including semaglutide, are marketed under names like Ozempic and Wegovy.

Ozempic and Wegovy: Market Leaders

Novo Nordisk’s Ozempic and Wegovy are at the forefront of this market, particularly in addressing the obesity epidemic. Initially approved for Type 2 diabetes, Ozempic quickly gained off-label popularity for its significant weight loss effects. Wegovy, also developed by Novo Nordisk, is specifically designed for weight loss and received FDA approval for this purpose.

How Crowded Is the Weight Loss Drug Market?

Experts predict that GLP-1 drugs could become blockbuster products with multi-billion-dollar sales potential. Eli Lilly and Novo Nordisk, too, could face stiff competition. Danish biotech Zealand Pharma is targeting the “next generation” of weight loss drugs, as quoted on CNBC.

CEO Adam Steensberg indicated early-stage trial results of its GLP-1 treatment in an interview with CNBC, but said that it is the company’s separate obesity drug candidate — Petrelintide, a long-acting amylin analog — that could set it apart in the weight-loss drug segment.