Weight Loss Drugs and Markets

I have always said that following markets gives you insight into important stories, as they develop, in real time, better than any other source. With money being put to work daily, you can see the predictive bets, the smart money, being one step ahead of what’s trending.

One recent example is the sudden surge of “weight loss” solutions has shown that in big pharma. Eli Lily (Ticker: LLY) has a $700 billion market cap and has been moving like a tech stock thanks to its Mounjaro and Zepbound drugs:

Novo Nordisk (Ticker: NVO) has a $400 billion market cap and has been moving in a similar fashion thanks to its weight loss drug Amycretin:

America is wildly obese, and has serious issues with obesity, and so it makes sense how these companies are catching fire. No one ever thought a weight loss solution was possible, and now, that trend seems to be reversing.

However, I personally will never invest in something like this. This is my own preference, of course, and there’s a reason to my thinking.

I am just simply flabbergasted, even weirdly amused, at how many people would rather inject a shot or eat a pill that they know nothing about – ingredients, development, country of origin, tail risks – as compared to eating healthier and going for daily walks. Also, why do phrama companies pick the worst names for these things? You will never see me taking something called Mounjaro. Instead, eat more natural food, go walking or inject something directly into your body that does not even show you a basic ingredients list. Really, there’s a standup routine joke in this somewhere – “sure, just inject it into me!”

At least when you go to the grocery store, you can read ingredients and other facts.

Anyways, I’ll be watching this industry for the following reasons and be looking for opportunities that are, what I believe, to be contrarian ways to play it:

1. What emerging companies are promoting healthy eating? Whole Foods, back when it was public, is a prime example of this. There will be more as this trend picks up.
2. What emerging companies are building new products for health? I am not talking about tech, but actual outdoor solutions or products that people like. After all, the outdoors is the oldest method of exercise in our DNA.
3. Will their be a negative side effect to these weight loss solutions that eventually scares the market? Potentially, there’s a short setup here somewhere.

Now, back to the markets!

Written by Stefan Cheplick, a fintech builder and writer with experience at Stocktwits and TradingView. Background and published work.