The next big market for weight-loss drugs: children

There are no FDA-approved medications for children with obesity. The agency approved Saxenda, which has the chemical name liraglutide, for teenagers in 2020 and for adults in 2014. Novo will seek FDA approval for the drug for younger children, the company’s head of development told the Financial Times.

“To date, children have had virtually no options for treating obesity. They have been told to ‘try harder’ with diet and exercise,” said lead researcher Claudia Fox at a meeting in Madrid, where the results of the study of 82 children were presented.

The medication can allow children with obesity to live healthier and more productive lives, she said.

Novo Nordisk’s American rival, Eli Lilly, has also been testing obesity-beating drugs for children as young as six. Novo Nordisk is the drugmaker behind the blockbuster medications Ozempic and Wegovy, while Eli Lilly produces Mounjaro and Zepbound.

Wegovy and similar drugs for weight loss have become a huge business. The US adult obesity rate was about 40% from 2017 to 2020, and Goldman Sachs researchers estimated last year that the drugs could be prescribed to 15 million Americans by 2030. The bank’s researchers said the anti-obesity drug market could grow to $100 billion by that time.

The drugs’ success has made Novo Nordisk the most valuable company in Europe. Its stock is up over 25% year-to-date.

Childhood obesity

An FDA approval on weight loss drugs for children could open up a new market for Novo Nordisk.

According to the Centers for Disease Control, one in five children and adolescents in the US have obesity, and the number of children ages six to 11 with obesity is about 6 million.

Novo’s pricing for Ozempic and Wegovy has come under recent political scrutiny. In June, US Sen. Bernie Sanders announced that Novo Nordisk CEO Lars Jørgensen would testify before the committee on September 24 at a hearing focusing on the prices that Novo Nordisk charges Americans for their drugs, Ozempic and Wegovy.

Sanders has investigated the prices, saying that they are higher in the US than in other countries.

The highly-coveted drugs are being used by celebrities, including Oprah Winfrey, Elon Musk, and Charles Barkley, and by non-celebrities alike.