Matt, you cover European health care, and we’ve seen a lot of headlines this year about obesity. What's going on there? 

The new treatments for obesity have been a major win for the sector. They came about through a set of drugs that were originally developed for type 2 diabetes but then showed an impact on weight loss. These are glucagon-like-peptide class, or GLP1 to be less of a tongue twister, which is a type of hormone that is naturally released by the body that helps regulate blood sugar levels. The reason they've been so successful is because they mimic the way in which our bodies react to food, essentially balancing the interplay of hormones. Basically, they slow the emptying of food from the gut and tell the brain that you're full.

And they work?

The companies have subsequently done randomised clinical trials with obese patients and seen a very significant impact. The first approval was for Wegovy, which is a Novo Nordisk GLP1 product, and that has had such a rapid uptake in the US that the company is selling every [injection] pen it can make. 

Wow.

The massive uptake for these products has really been driven by the appeal of having a safe and effective medication. In previous years, earlier efforts might have led to weight loss, but they'd come with side effects that were not tolerable. We now have quite a decent track record on these new drugs; we can see how they're working over the semi-long term, and the level of weight loss has gone up significantly. We now have once-a-week dosing too, and that has been a large draw for patients. 

But while we’ve seen the headlines about Ozempic, that’s actually the type 2 diabetes treatment, and the weight loss drug is under a different brand name?

That's correct. The biological product is exactly the same, but it was originally developed for type 2 diabetes. 

What’s the potential longer-term scale of the market?

The market is huge. It's around 600 to 750 million patients globally, and in the US - which is the key pharmaceutical market - it’s 140 million patients. In the UK, for example, around a third of the population is obese, but that’s as high as 42 per cent in the US. 

And obesity can have very significant co-morbidities, whether that's type 2 diabetes or cardiovascular disease, how it impacts our ability to treat cancer, or on a patient’s quality of life.

Have we got better at dealing with obesity?

No, as an issue it is becoming much worse. Adolescents and children are becoming more obese and more severely obese, and they require more and more pharmaceutical interventions to get that under control. 

Those patient figures are pretty staggering. 

Yes, it's astounding, and there are challenges on all major fronts. The two leading companies - Novo Nordisk and Eli Lilly - have invested around $5 billion between them to scale their manufacturing to meet demand. But simply getting access to patients can be hard. In the UK, only around 1 per cent of eligible patients are able to access these products.

In the US, a lot of patients get access through their insurance coverage, and they've had success in the commercial insurance market. But currently it would require a change in legislation in the US to expand that to government channels, such as Medicare.

Given the cost of these new treatments, which can range from $7,000 to $10,000 per annum, the numbers quickly get enormous. 

But presumably the savings that are made on the co-morbidity side - savings made on the side effects of obesity - make it worth it?

The direct cost of obesity was recently estimated to be around $250 billion in the US, and a report on the cost-benefit analysis of these drugs suggested they could be priced at a 45 per cent discount from current levels and still be effective to the system. Looking at the consensus estimates just for the two major products alone, we’re already looking at around $50 billion of sales to treat obesity, and $100 billion for the class in total globally when you include type 2 diabetes.  

These drugs seem to represent the gradual shift from obesity being something that was maybe looked at as a lifestyle issue to something that is very much health-related and can be medicated for.

Historically it's mainly been treated through diet and exercise, but the pathophysiology of obesity has shown that these alone aren’t enough to get the disease under control in many patients. Obesity is an incredibly complex disease, a metabolic disease which involves the brain, the level of fat in the body, and the interplay of hormones within the body because of those two things.

And that’s where the new drugs come in?

At this current stage, Wegovy is now available in the US market and is being expanded across the globe. The uptake in the US has been pretty phenomenal and it's been associated with huge patient demand. That's been driven by the primary care physicians and by specialists like endocrinologists. But we’ve also seen really significant, almost idiosyncratic, patient activation through social media and through celebrity uptake, which has really raised awareness and helped to lift any stigma around these products. 

Now we’re looking at more development within the sector, whether looking at further combination strategies, a new target (which also might lead to higher weight loss), longer duration of therapy, or maybe oral administrations.