Generic Versions of Weight Loss Drugs Will Upend the Market

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1:02Bloomberg Audio Studios. Podcasts. Radio. News. It's been a little more than eight years since the FDA approved the medical use of semaglutide. That's the key ingredient in Ozempic. Since then, the market for diabetes and weight loss drugs has exploded. 300 percent, which is the increase in U.S. sales of Ozempic or similar medicines between 2020 and 2022. The popularity of those drugs on social media and in clinics is soaring. For years, the patent for semaglutide in many countries has been held by one company, Novo Nordisk. Right now we are focusing on diabetes, weight loss and overweight. And the main reason for it is that the combinations of these three areas basically has 2 billion people in the world suffering from it.

1:56That's Novo CEO Mike Deustar. On Tuesday, he spoke to Bloomberg TV about the release of their 2026 sales guidance. Dostar also spoke to Novo's earnings projections for 2026. While today you see a negative growth on the financial numbers, I see a lot of positive growth on the other sides of the business. Novo's stock slumped as much as 20 percent on Wednesday, after the company's Tuesday forecasts showed that sales would fall by as much as 13 percent this year. And the company's market value has fallen to about$215 billion for more than$600 billion in 2024. Not a good start to the trading day on Wall Street this Thursday.

2:35We've got shares of Novo down another 4%. Eli Lilly down 5.3%. Hims and Hers reportedly launched a copy of the Wegovi weight loss pill starting at$49. One of the key factors in the company's projections, competition from generic versions of its blockbuster drug. We're now reaching a moment where generic versions of this drug will start being available in large markets around the world, outside the U.S. and outside Europe. That's Bloomberg Health reporter Naomi Kresge. Previously, most of the world had only limited access to Novo's drugs. But Novo's patents for semaglutide are starting to expire in some big markets.

3:18We saw the first patent fall in Canada in January. A bunch more patents are going to lapse or expire in March in China and India and a number of other countries. Amber Tong covers the Asian pharmaceutical industry for Bloomberg. She and Naomi have been tracking patent expirations for semaglutide and the ripple effects those expirations will have. This effectively clears the way for drug makers to start creating generic alternatives to Ozempic and Wegovi, another Novo Nordisk drug that uses semaglutide. The FDA approved that one for weight loss in 2021. Amber says these changes won't happen overnight.

3:57But once generic versions of those drugs hit the market, the ramifications could be huge. And Novo's sales forecast for 2026 could be just the beginning. So we imagine it's going to be slow starting to start, but then when you look back, it will be a seismic change.

4:21I'm David Gurra, and this is The Big Take from Bloomberg News. Today on the show, as Novo Nordisk's patents on semaglutide run out, other companies are looking to cash in. We take a look at what new generic weight loss medications could mean for the companies that pioneered them, and for the consumers who could benefit from them.

4:47Today, the majority of the world's GLP-1 medications come from two pharmaceutical companies. The first is Danish drugmaker Novo Nordisk, which uses the active ingredient semaglutide to make Ozempic and Wegovi. The other big player in weight loss drugs is the American company Eli Lilly, which makes the drugs Monjaro and ZepBound using a different ingredient called terzepatide. That ingredient still has another decade of patent protection. But even with Novo facing more looming competition from Generics and a drop in its 2026 sales forecast, its CEO told Bloomberg TV he's optimistic about the company's prospects.

5:24Everyone notices that GOP-1 market as a segment is growing, and we have been able to actually show that we can take part of that growth. Bloomberg's Amber Tong says generics could complicate the picture of that growth in 2026. Amber, how quickly is the market poised to change? Is this something that's going to happen overnight? We see these patents expire, we go over this patent cliff and then boom, a host of new drugs pop up? Or how long is it going to take? It's definitely not going to be overnight. We actually have to wait until that crucial moment after the patents fall and then the regulators may come in and start issuing these approvals.

6:04Regulators in each market will have to approve the generic semaglutide before it's available to consumers, a process, Amber says, that can take months or even years. First up is Canada, where the market opened to semaglutide from companies other than Novo Nordisk on January 4th. Canada is currently the second largest market for semaglutide in the world. And it's really a good example or a case study of what's going to happen in a wealthy, developed market after the patents fall. Novo's U.S. patent on semaglutide won't expire until 2032. But it'll be a useful litmus test, generics hitting the market in Canada.

6:44A pregame of sorts for what's going to happen in markets like the U.S. Amber says the rollout in Canada will give her a sense of which brands are likely to get more traction in the years to come, and how the market for weight loss drugs is going to change. And while it'll be more than five years until generics go on the market in the U.S., some generic semaglutide sold in Canada could make its way south before then. We learned from reporting this story that Canada could basically cause this market leakage problem for the U.S. people in the U.S. may actually cross the border to get their drugs from Canada, or drugs from Canada could be imported into the U.S.

7:25through states like Florida. But Canada isn't going to be a perfect parallel for what the rollout of generic weight loss drugs in the U.S. is going to be like. For one thing, prices of generic drugs in Canada are more highly regulated than they are in the U.S. Some analysts told Naomi and Amber that China, where pricing is more dynamic, may be a better comparison. And Novo's patent on semaglutides there is set to expire in March. One of the big similarities of the U.S. and China is that they are both very large countries with a pretty sizable population living with obesity. But the current penetration of obesity drugs in China is very small compared to the U.S.

8:09Some estimate it to be around 1%. GLP-1 medications are much more popular in the U.S., where recent polling has found roughly 12%, one in eight adults, have taken them. But Amber says the market for obesity drugs in China is poised to take off. So the obesity drugs like Wegovi and Monjiro, they've relatively, they have only been introduced to the market for a very short amount of time. But people in China have read from social media, they've read from the news, they've heard Elon Musk talk about the life-changing effects of GLP-1 drugs. So China has actually, I guess in a sense, been hearing about the drugs for longer than they have been able to use the drug.

8:55I think one very distinguishing factor about the China market is that Chinese people are really used to shopping online. E-commerce platforms are everywhere and people are just so used to shopping, buying things off e-commerce platform for their everyday needs. And this actually created a really fertile soil for the obesity drugs to kind of take hold. We see companies like Novo Nordisk and Eli Lilly partnering with e-commerce giants like JD.com and Alibaba Group. They're building these education corners on these e-commerce apps to educate the public about obesity drugs and providing a very easy way, accessible way for consumers to buy these drugs.

9:47So I think in that sense, China is much more primed for the consumerization of obesity drugs. In India, the newest and most powerful GLP-1 drugs were only approved in 2025. In March of that year, Eli Lilly started selling Manjaro in India, and Novo Nordisk followed three months later with Wegovi. And Naomi says that set off a wave of demand. As soon as obesity drugs were available in India, people did start queuing up at the doctor's offices where they could get prescriptions to get these medicines. And there is a sense that this avalanche of patients is just going to become bigger as the generics go on the market.

10:32The patent for semaglutide in India is also going to expire in March. And Naomi says the country's generic drug makers are preparing to jump in for a chance to compete for a slice of the country's weight loss drug market. Worldwide, the financial services group Nomura projects the market for generic semaglutide will reach nearly$8 billion by 2030. About 15 % of that market will be in India. With all that competition, analysts expect the prices of weight loss shots there will drop by as much as 50%. The price that semaglutide is sold at in India was attainable for, you know, well-off people there.

11:10But if we have a price war where the cost goes as low as$15, in India, that just opens up a much larger market and enables just a much broader cross-section of the society to try out these medicines. Naomi, picking up on that, it makes me wonder sort of how these pharmaceutical companies that have been making these drugs, so Novo and Eli Lilly, are thinking about this moment, how worried they are about the prospect of generics now coming on to the scene. And what are we hearing or seeing from those companies as we approach this moment? So Novo has tried to put an estimate on the impact of generics for this year, and they've told investors that it'll have an impact on sales.

11:51And I think one really interesting thing from a Novo perspective to watch is to see how they have dropped the price of the name brand, Wegovia Nozempic, in China and in India as well. And they've also introduced these second brands. So like they're semaglutide, but sold under a different brand name, like their own low cost version. So one surmises that that must be an effort to also capture some of this market and hang on to some of it. While the arrival of generic semaglutide is likely to drive down the price of weight loss drugs everywhere the patent falls, This is not the first market challenge drug makers like Novo Nordisk and Eli Lilly have faced.

12:36What's different with generic GLP-1s? That's next.

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13:49In early 2022, Novo Nordisk was struggling to manufacture enough Ozempic and Wegovi to keep up with demand. That March, the FDA added those two drugs to its shortage list, which opened the gates for compounding pharmacies to make their own copycat versions of the semaglutide medications. I asked Bloomberg's Amber Tong what makes the arrival of generic versions of Ozempic and Wegovy different. Compounding is quite unique to the U.S., right? Pharmacies are allowed to take the active ingredient of Ozempic or Wegovy, namely semaglutide, and create their own concoctions when the drugs are in shortage or when the patients require a specialized formulation for individual needs.

14:36Hims and Hers reportedly launched a copy of the Wegovi weight loss pill starting at$49, which compares to$150 at the lowest end for the starter dose of Wegovi. So that sends shares of Novo Nordisk as well as Eli Lilly down. Compounded Semagluhead doesn't need to be approved, but generics need to be approved before they can be sold on the market. And there's much more scrutiny on the regulator side on how they're manufactured and how they're sold. Bloomberg's Naomi Kresge says the market for compounded semaglutides in some ways may have helped seed the production of generic semaglutide. People have told me that, interestingly enough, part of the reason why compounders could be so successful in the U.S.

15:25with compounded Wigovi is that, you know, the compounders weren't making the drug ingredient themselves. They were buying it from somebody. So who were they buying it from? They were buying it in some cases and probably in many cases from generic drug makers that had already figured out and planned and, you know, started producing samaglutide in anticipation of the, you know, drug becoming generic in a lot of markets. And so it's not an overnight, sudden, you know, clap your hands and it's done thing for a generic drug maker to figure out how to copy a complex medicine like semaglutide. And so people have told me in the industry that that availability and existence of this drug ingredient that had been prepped already just meant that some companies could like ship it to the U.S.

16:16and sell it to compounders. Essentially, drug manufacturers in China and India got a head start on semaglutide production. And they have those compounding pharmacies to thank. As it stands, roughly one in four generic drugs Americans take relies on key ingredients from China. And the bulk of the U.S.'s generic pharmaceuticals are made in India. China is better at making the raw ingredients, the building blocks for the drugs. But Indian companies are better at actually doing the development work and filing the paperwork to secure approval and actually market those drugs overseas. And now that patents on semaglutide are ending, they're positioned to get even more dominant.

16:55I think it's mainly going to underscore the key role that China and India have in manufacturing drugs for the world. So for a lot of Chinese and Indian companies, this is actually a great business opportunity that they're really hoping to seize. Amber and Naomi say the arrival of generic semaglutide is not just a huge event for the pharmaceutical industry. It's also potentially a game changer for global health, one that comes at a critical moment. I think we should take a step back and imagine what the world is going to be like without these drugs. We spoke to someone from the World Obesity Federation for the story, and she noted that currently 1 billion people around the world are living with obesity or overweight.

17:45And by 2035, that number could grow to 4 billion. And a lot of that burden is falling on global South countries, developing countries like China and India and Nigeria. So if nothing is done, if things don't change, then the population of people with obesity and at risk of the consequent cardiometabolic complications and other health issues, that's going to really balloon over the next decades. So the availability of the generics could play a big role in stopping that or at least alleviating that huge growth. I think it will be crucial to see how health systems can utilize these generics, because it's not just about, you know, in a consumer type setting, people deciding to use generic Wiggovi to lose a few pounds.

18:48These are powerful medicines. Health systems need to address the drugs not as kind of a cosmetic thing, but really use them for their cardiovascular benefits, for their liver benefits, for all of the health benefits that they can provide in a responsible way.

19:15This is The Big Take from Bloomberg News. I'm David Gurra. To get more from The Big Take and unlimited access to all of Bloomberg.com, subscribe today at Bloomberg.com slash podcast offer. If you like this episode, make sure to follow and review The Big Take wherever you listen to podcasts. It helps people find the show. Thanks for listening. We'll be back tomorrow.

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