The Underground Peptide Market Is Getting Ready to Go Mainstream

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1:56Bloomberg Audio Studios. Podcasts. Radio. News. Essentially, if you have a health concern or problem, whether that's a physical problem or a cosmetic or aesthetic one, there is probably a peptide for that. That's Madison Muller, who covers the pharmaceutical industry for Bloomberg. Recently, she's been hearing a lot about a specific kind of drug. Peptides. I've been hearing a lot about them, too. They seem to be everywhere. Now to the injectable peptides crates sweeping social media.

2:31Amanda Mull:If you're in your 30s and you're not incorporating peptides into your skincare routine, why not? At the most basic level, peptides are chains of amino acids that bind to receptors in the body to turn processes on and off. Peptides are used in lots of different drugs, and they promise all kinds of transformative benefits. They will make you theoretically tan, beautiful, snatched, pain-free, well-rested. That's Amanda Mull, a senior reporter for Bloomberg Businessweek. She says some of the most popular peptide-based drugs are ones you probably recognize, like GLP-1s for weight loss and insulin. Some of the substances that we're talking about are like extremely well researched, extremely widely used, safe, effective.

3:18Amanda Mull:And they come from pharmaceutical companies that have large, well inspected facilities for producing peptide drugs in large quantities. But there are a lot of other peptide based injectables that are largely unregulated. There's a lot of substances that have not been trialed extensively in humans or hardly at all in humans for some of them. They do not come generally from large pharmaceutical companies in the U.S. They are imported sort of as research materials. The sale of them is generally illegal for human use. But Amanda says right now, the underground peptide trade is booming. You could buy some in a minute or two if you got out your credit card right now.

4:03Already, investors estimate that this peptide black market is worth$1 to$3 billion. But it might not be a black market for long, because the U.S. Secretary of Health and Human Services is himself a peptide enthusiast.

4:19Amanda Mull:I mean, I'm a big fan of peptides. I've used them myself and used them with really good effect. That's Robert F. Kennedy Jr. on Joe Rogan's podcast in the summer of 2023. Kennedy has been pushing the FDA to take a closer look at the drugs, in part because he says he wants to divert demand away from what he's called a dangerous black market. That could potentially pave the way for state-regulated compounding pharmacies to make some peptides legally. If all of these things get put into legal compounding in the U.S., that probably expands a lot of people's risk tolerance and willingness to try them because they're coming from like a certified facility.

4:59Amanda Mull:They're, you know, traceable. They're, you know, just brings it out of the shadows a little bit.

5:09I'm Sarah Holder, and this is The Big Take from Bloomberg News. Today on the show, inside the billion-dollar peptide craze, how the drugs moved into the mainstream, and what regulation would mean for telehealth companies, big pharma, and the alternative wellness industry.

5:31What's the origin story for these drugs that use peptides? Well, peptides have actually been around for a long time. They sort of became popular on like the fringes of the fitness and the bodybuilding community. And over time, they've sort of seeped into more of the mainstream culture.

5:47Amanda Mull:If you are looking for an inflection point, it is probably like 2021, 2022. when people beyond the sort of like type 2 diabetes patient community started to become aware that Ozempic and then Munjaro were really great for weight loss. That started to become, you know, something that people wrote about in like culture magazines and on blogs and like on Reddit. So people started to look for options to receive these drugs. People were seeking out GLP-1 drugs from compound pharmacies or medical spas. And once they got comfortable sort of taking a medication that was not necessarily a branded pharmaceutical product, some of these med spas, some of these doctors started recommending other things.

6:33So let's try BPC-157 or let's try GHK-CU. All of these sort of sound like alphabet soup of various letters and numbers and things. But people got comfortable with the idea, one, of injecting themselves with something because of the GLP-1s and then also taking something that didn't come from a brand name pharmaceutical company. And we're also seeing right now, I mean, a lot of people who are big personalities, podcasters, biohackers sort of talking about various like experimentation that they're doing with their own health. I mean, we have people like Brian Johnson that have a lot of followers, have gotten a lot of attention.

7:09Joe Rogan's talked about peptides on his podcast. And so that's, again, sort of thrust them into the mainstream culture more and people just being more willing to sort of get health care from outside of the traditional health care system, outside of what doctors are prescribing them and sort of taking it into their own hands, sometimes in an extreme way. Amanda and Madison talked to several people who've recently started using peptides. It's not all biohackers and looks maxers. It's people like Christy Turner, a therapist from Indiana. I feel like, I honestly think GLP-1s have just been a gateway drug to peptides.

7:45Christy started using ZetBound, a GLP-1, in May of 2024. She credits the drug with helping her lose 200 pounds in two years. I've had a pretty charmed Disney experience on ZetBound, really. Then, about a year ago, Christy started using GHKCU, which helps with the skin sagging that often accompanies massive weight loss. And more recently, she's also started taking glutathione, which is supposed to boost her immune system. U.S. regulators don't permit GHKCU to be compounded in its injectable form. But Christy's doctor, a functional medicine practitioner and osteopath with her own independent practice, sources the drugs from compounding pharmacies that are willing to make them.

8:30Compounding pharmacies are state-regulated facilities that are licensed to make customized versions of drugs. Christy sees her doctor remotely and trusts her advice. She always does a good job of educating me on what it is, not just saying you should take it. But she says, hey, if this is a concern, here's information on it. Let me know what you think. I looked at her stuff and then I did a lot of research on my own. And I really just didn't feel like the risks were significant for me to take. I mean, I just really didn't feel like I had risk really at it.

9:04Amanda Mull:Her story, to me, is sort of a case study in how people's risk tolerance expands. Bloomberg's Amanda Mulligan. And how, like, somebody who wants to do things the very traditional, very by-the-book way can sort of have their mind opened to doing things that are sort of beyond that original risk tolerance because of the sort of networks of trust and relationships that they have to these drugs. The reason there's this huge underground market for peptides is that, aside from high-profile drugs like GLP-1s, most have not been approved for clinical use in the U.S. Some of the peptides we're seeing today were first developed by pharma companies, but weren't projected to be safe or effective or profitable enough to be put through the FDA approval process.

9:51For a lot of them, that means they haven't gone through robust, long-term safety testing. And in the world of drugs, unlike, say, supplements or cosmetics, unapproved essentially means illegal.

10:05Amanda Mull:In 2023, the Biden administration, FDA, decided to put many of these peptides on a list that explicitly banned compounding pharmacies from putting them in drugs for consumers, even with a valid prescription. But before that, it was just sort of like they were illegal because they weren't explicitly made legal in some way. And so as they became more common online, the Biden administration said, we know that this is becoming more popular. We will enforce against this. That got some of the compounding pharmacies that had been dabbling in this. It got some of them out of the business. And this almost sounds like a naive question, but how are people getting them anyway then?

10:45It is so easy to order anything that you want online these days. So that's part of it is people are ordering what is considered research use only chemicals sort of online a lot of times from China or other overseas suppliers. It's not technically illegal to possess these chemicals. And you can sell them as long as you're not marketing them as medicine. So black market peptide vendors will often market their products as research chemicals, not for human consumption. It shouldn't be a loophole, but it is. It's people or some businesses think that by labeling something as research use only, it sort of shields them from liability of like actually selling something or importing something into the U.S.

11:27that people are not supposed to be taking.

11:29Amanda Mull:So what is being imported and sold to consumers in the case of these black market peptides is active pharmaceutical ingredients. You get the powdered version of these active ingredients that is then imported. And with peptide drugs, the powdered active ingredient, the only really difference between that and like a like a finished usable drug is reconstitution with like a type of sterile water that then makes it injectable. So you've got this powder coming in that is pretty easy to teach people how to use once you can get it into their hands. And buyers often don't know what's in these research-use-only chemicals.

12:08So their rise has also led to a growing demand for companies that test these peptides.

12:14Amanda Mull:As more and more people have heard about them, and the only way to get a lot of them is through this sort of trade with American resellers of Chinese peptide ingredients. More and more people have said, like, wait, can you show me something that proves that, like, this powder is what you say it is and it's not fentanyl or something like that? The underground peptide trade may soon move out of the shadows. What that means for these chains of amino acids and the future of our health care system after the break.

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15:44When U.S. Health and Human Services Secretary Robert F. Kennedy Jr. was asked about peptides on the Joe Rogan show in June of 2023, he said he was a fan. He's peptide positive, I would say.

15:56Amanda Mull:That's Amanda Mulligan. He said that he has taken peptides, that he had a good experience with them, that he thinks they're very interesting. Yeah, and a lot of the people in RFK's circle are also peptide positive. A lot of these figures within the Maha movement, the Make America Healthy Again movement, have some sort of relationship to or have talked about taking peptides themselves. So there's a lot of chatter right now sort of from these circles as well that have become increasingly influential in this administration. Madison Mueller says all these peptide positive vibes could soon lead to a seismic change for the industry.

16:32So there's basically going to be a advisory committee meeting at the end of July in which a group of independent experts will review the evidence, which there isn't much evidence to review, and basically make a non-binding recommendation to the FDA and to HHS about whether these should be legalized, whether they should be sort of categorized differently to allow compounding pharmacies to make them in a legal way in the U.S. This FDA committee is expected to recommend that seven peptides be added to the list of substances available for legal use in compounding pharmacies, with another five to be considered for inclusion by early 2027.

17:13Kind of at the end of the day, the HHS secretary or head of the FDA can decide what they want to do sort of regardless of what comes out of that meeting. But that meeting is supposed to be an important step toward legalizing these substances. And who are the potential winners here if peptides do gain the regulatory approval that the administration is pushing for?

17:35Amanda Mull:Well, I think that there are a lot of parts of the healthcare industry that have already started to line up behind what they see as an eventuality. Telehealth platforms, which have benefited enormously from the GLP-1 boom. Compounding pharmacies, telehealth platforms and compounding pharmacies often partner to serve large-scale patient populations for particular drugs. entrepreneurs who are starting up, you know, ways of sourcing these drugs like fitness influencers. The funny thing about the sort of research chemicals is that in order to like not violate federal law, when you're selling research materials, you're not supposed to acknowledge at all that they might have any kind of effects in the human body.

18:22Amanda Mull:You're not supposed to provide dosage advice. And part of that is you're not supposed to partner with influencers who talk about how wonderful they are for your skin or your sleep or your body composition or whatever. But, you know, compounding pharmacies and telehealth platforms do have like much broader capacity to partner with advertisers, to partner with platforms, to partner with influencers. So the further this gets brought into regulatory compliance, the more opportunities there are for a lot of fronts. But even if they do gain more widespread acceptance, since peptides won't necessarily be heading for your GP's office.

18:59They still are sort of on the fringes of the regular traditional drug approval system because they won't be FDA-approved products. Even if the FDA says that compounding pharmacies can make them, it's different from the pharmaceutical-grade products that have been tested extensively in hundreds or thousands of patients over many, many years in large blinded trials. So how will companies handle these if they are wanting to be above board and sort of comply with like the FDA standards for drugs is sort of a lingering question. From a business perspective, who are the potential losers here? Who doesn't stand to gain if these kinds of regulatory shifts happen?

19:43Amanda Mull:I think that like a potential loser here is big pharma because a lot of these very, very popular compounds, like they don't exist in patent protection anymore. There's not really any direct way that any particular pharma company can profit off of these any more than like a, you know, an enterprising compounding pharmacy or telehealth platform. So not only that, but you have like a patient population who is more and more comfortable sort of finding someone who will sell them something directly, whether that is finding a doctor online who will send them to a compounding pharmacy or whether that is finding active pharmaceutical ingredient powder themselves and figuring it out from there based on what people on Reddit say.

20:26I know the answer to this is probably it depends, but I am wondering what having more peptides available legally through compounding pharmacies means for patients or potential users.

20:38Amanda Mull:I think that the upside of this potentially is harm reduction. You've got a patient population of millions of people who are on these medications currently or who are very interested in getting on them. And if a lot of them are willing to take peptides from wherever online, then is it ultimately safer and more beneficial to those patients to give them sort of a safe supply situation? But then you've got like sort of the downside of putting this sort of imprimatur of safety and efficacy and legitimacy on drugs that like we don't really know if they're safe or efficacious or good for you in the long term.