No Mercy / No Malice: The Weight

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1:13Support for this show comes from Odoo. Running a business is hard enough. So why make it harder with a dozen different apps that don't talk to each other? Introducing Odoo. It's the only business software you'll ever need. It's an all-in-one, fully integrated platform that makes your work easier. CRM, accounting, inventory, e-commerce, and more. And the best part? Odoo replaces multiple expensive platforms for a fraction of the cost. That's why over thousands of businesses have made the switch. So why not you? Try Odoo for free at odoo.com. That's O-D-O-O dot com.

1:55I'm Scott Galloway, and this is No Mercy, No Malice. The most transformative technology with the greatest asymmetric upside isn't ChatGPT5, but GLP-1s. The weight, as read by George Hahn.

2:24George Hahn:God, I'm sick of talking about SpaceX. More impressive than the Falcon Heavy rocket, and it is impressive, is Elon Musk's ability to manufacture scarcity. Getting the NASDAQ to waive requirements applied to every company until now so he can force index funds to purchase shares aims a demand cannon of$75 billion at a business with a small float. The result is a price that in no way reflects the underlying value But I digress This isn't an investment, but a trade So where to invest? The technology with the greater asymmetric upside As well as the clearest path to transforming the economy And the well-being of more than 200 million Americans Isn't Falcon 9 boosters or GPT-5 but GLP-1s.

3:25U.S.

3:26George Hahn:obesity rates have tripled over the last 60 years. Our instincts, developed over hundreds of thousands of years when food was scarce, haven't kept pace with industrial production, so we gorge. Obesity is a comorbidity for 200-plus chronic diseases, the central node in a network of poor health outcomes. The total bill for national health expenditures, including public and private spending, is$5.3 trillion. By 2033, one out of every$5 in the economy will go to health care. This is the IED at the center of the U.S. economy. Five years ago, when Ozempic and Wagovi were first approved for weight loss, GLP-1s looked like a silver bullet for obesity.

4:26George Hahn:Today, they're a fully loaded magazine of silver bullets aimed at obesity, addiction, cancer, sleep apnea, and a growing list of other diseases and chronic conditions. The velocity of innovation is remarkable. Usually when a new medicine happens, we have time to learn how to use it Dr. Melanie Jay, director of the NYU Langone Comprehensive Program on Obesity told the New York Times But with GLP-1s, everyone is kind of iterating in real time Some recent iterations Last month, Eli Lilly announced that its Phase III trial for retitrutide, a triple agonist dubbed Godzilla that activates GLP-1, GIP, and glucagon receptors, appears to exceed the performance of other weight loss medications.

5:26George Hahn:On average, patients on ZepBound or Wagovi lose between 14 % and 20 % of their initial body weight over 72 weeks. Patients in the retitrutide trial taking 4 mg, 9 mg, and 12 mg doses lost an average of 19%, 26%, and 29 % of their starting weight, respectively. But the most promising drug is Foundeo, a daily pill from Eli Lilly, the FDA approved for weight loss in April. In clinical trials, it resulted in 12 % weight loss over 72 weeks, less effective than shots, but a good alternative for the 66 million Americans who are afraid of needles. The pills also show a promise as a maintenance tool. As Nicholas Florco wrote in The Atlantic, America has a new GLP-1 playbook with a shot to lose weight and a pill to keep it off.

6:31George Hahn:In the U.S., one in eight adults currently take a GLP-1, with prescriptions for weight loss doubling from 2024 to 2025. It's working. A year after the drugs were approved for weight loss, the U.S. obesity rate peaked at 40%, but it has since begun to decline. Sadly, GLP-1s haven't had the same impact on their initial target, diabetes. William Gibson famously said, The future is already here, it's just not evenly distributed. He could have been describing GLP-1s. A recent Cleveland Clinic study found that cost is by far the primary reason people quit, with 47 % of those who discontinued the drugs citing insurance denial, expiration of a discount coupon, or unaffordable out-of-pocket expenses.

7:34George Hahn:Side effects were the second most common reason cited by 14 % of respondents while less than 2 % quit due to unsatisfactory weight loss. In other words, GLP-1s can change society if we distribute them to everyone who needs them, regardless of their ability to pay. The good news? Beginning July 1, Medicare Part D will cover certain GLP-1 treatments with a$50 monthly copay for seniors. The bad news? Private insurance plans, which provide pharmaceutical benefits for two-thirds of Americans, are scaling back GLP-1 coverage, if they even offered it to begin with. According to the Wall Street Journal, 11 % of employers have dropped or are planning to drop GLP-1 coverage for weight loss altogether, and more than a quarter of big companies are adding hurdles, such as requiring multiple weigh-ins a month, meal tracking on apps, or mandatory health coaching.

8:42George Hahn:The U.S. is simultaneously hitting the gas while pumping the brakes on the best tool we have for combating obesity. With a few exceptions, the 17 companies valued at $1 trillion or more are all technology companies heavily invested on AI. The only drug maker on the list is Eli Lilly, whose shares have registered a 418 % increase since GLP-1s were first approved for weight loss in 2021. Novo Nordisk, Eli Lilly's chief competitor and the maker of Ozempic and Wagovi, is up just 2 % over the same period. The discrepancy points to something unusual about the dynamics of GLP-1 pricing. Typically, drug prices are inelastic, i.e.

9:36George Hahn:consumers aren't very responsive to price changes unless a generic option is available. But as one industry analyst explained, the obesity market has turned traditional pharma economics upside down. Eli Lilly's products have a perceived efficacy edge, but the company also beat Novo Nordisk to the direct-to-consumer market. On my podcast, Eli Lilly chair and CEO David Ricks told me, in the GLP-1 category, we observe prices are elastic. The more we lower the price, the more users we get. That's the path we're on. GLP-1s may be the rare pharmaceutical case where capitalism is on the consumer side.

10:27George Hahn:But Ricks also told me GLP-1s are unique insofar as nearly everyone who takes them loses weight. Unlike drugs for other chronic conditions, people like being on GLP-1s because they notice results in their appearance, rather than intangible health benefits and side effects. The fine print? Many people may never stop taking GLP-1s, creating an enduring subscription business. Think Netflix, but with monthly prices ranging from$149 to$499, and instead of market competition, a duopoly. GLP-1s may not be an off-ramp from the industrial food medical pharma complex, but the ultimate physiological lock-in.

11:20George Hahn:Victoria's Secret shares surged 47 % last week after the company reported 15 % year-over-year revenue growth and raised full-year sales guidance to$7.1 billion. dollars. Meanwhile, fast food chains are shrinking their footprint, with Jack in the Box, Pizza Hut, and Wendy's among the brands closing hundreds of stores nationwide. That's yet another bad sign for an industry that's registered more than 500 franchisee bankruptcies this year. U.S. alcohol sales are also down, with Diageo and Pernod Ricard reporting a 15 percent decline year over year, while Constellation brands saw a 10 % drop. CEOs have blamed tariffs, affordability, and, in the case of alcohol, Gen Z.

12:16George Hahn:But GLP-1s are a more likely explanation for the shift in consumer behavior. More signals? The share of apparel exchanges where shoppers size down has risen for three consecutive years, hitting a 14 % high among online retailers. Adults who use GLP-1s consume 21 % fewer calories and spend nearly a third less on groceries on average. Meanwhile, 59 % of Americans say they'd be more likely to visit restaurants that serve flexible, customizable, or innovative portion-size options. And that goes up to 73 % among GLP-1 users. The same report noted that 13 % of restaurant operators have listed items that appeal to GLP-1 users, higher protein and or fiber, and 42 % say they're considering such additions.

13:21George Hahn:There will be downstream effects. A significant decline in fast food revenue will accelerate closures across the industry's 200 ,000-plus U.S. locations, destabilizing commercial real estate markets and threatening the livelihoods of the 4 million people who work in the sector. Apparel brands that built supply chains around stable sizes and predictable returns will have to adjust to hit a moving target, America's shrinking waistline. The AI narrative has turned negative. Energy costs are up, jobs are supposedly going away, relationships are going virtual, and if the technology advances as promised, it presents a threat to humanity.

14:11George Hahn:The GLP-1 story offers something Silicon Valley used to produce in abundance, a hopeful vision of the future. Every American knows people who struggle with their weight. We all know someone who has a chance to live longer, do more, and feel better about themselves because of GLP-1s. A nation's greatness isn't measured in GDP, but in the quality of life its citizens enjoy. For the first time in decades, American innovation is adding years to lives, not just zeros to valuations. The question isn't whether GLP-1s will change the U.S. They already have. The question is whether we'll be stupid enough to ration the change.

15:07George Hahn:Life is so rich.

15:22Formula One, so hot right now. It's like if traders in succession had a baby, on wheels. Teams lying. Drivers beefing. Celebrities everywhere. And scandals, lots of scandals. So we made a show about it, the Red Flags podcast, where we recap races and break down all the latest F1 headlines. But no nerdy tech talk. We only cover the stuff you want to hear about. Yeah, and the only thing hotter than the drivers are our takes. And now we're doing it on Vox. Oh, we're so legit now. We're basically thought leaders. TED Talk incoming. And we do a podcast with Gunter Steiner called Venka Hours. I still can't believe that's true.

16:08Well, believe it. There is so much for the beautiful Vox Media audience to enjoy. So come check out the Red Flags podcast every Monday on YouTube or wherever you get your podcasts.