Obesity drugs (GLP-1)

The nutrition business (18%) is recovering: high-pro- tein food supplements to prevent muscle loss are now recommended for patients on weight-loss drugs such as Ozempic.

That focus appears to be paying off: since its January US launch, the Wegovy oral pill had passed 3 million prescriptions by early June (roughly one every five seconds) with more than 80% going to patients new to GLP-1 therapy.

Magnum initially came on to Upslope’s radar as I reviewed out-of-favor consumer staples businesses but sought those with manageable GLP-1 risks due to lower U.S. sales concentration (Magnum is ~25% U.S.).

All three major pharmacy benefit managers now cover Lilly's obesity portfolio, including its new daily oral GLP-1, Foundayo.

We are encouraged that Divi’s has been onboarded by large global innovators and pharmaceutical companies into the oral GLP-1 and GLP-1 injectables value chain as a supplier of complex intermediates and custom manufactured peptides.

The company delivered a strong quarter, with revenue and earnings exceeding expectations, driven by accelerating demand for high-value products and GLP-1 components.

Its growth outlook continues to look favorable, backed by a strong pipeline of products that benefit from global demand for GLP-1 peptides.

More recently, we were one of the first bears that initially pointed out its overall reliance on compounded GLP-1 medications, to its shady prescribing practices for the same drug that led to Novo Nordisk (NVO) terminating their first partnership with the company, and finally, the eventual patent infringement suit against the company by Novo Nordisk in February.

The stock sold off after the launch of oral GLP-1 drugs, which some believe will end the need for injectable formats.

Experts believe an expanding GLP-1 TAM, coupled with varying use cases, will necessitate ongoing need for injectable forms.

Its market- leading Optimum Nutrition protein products have established it as a premier brand in the performance nutrition market, benefiting from an increasing consumer focus on health and wellness, rising protein consumption and growing GLP-1 adoption.

Wegovy pill sales of DKK 2.26 billion were almost double the predicted DKK 1.16 billion, early signs that the new CEO's strategy of pushing volume to offset pricing pressure appears to be showing signs of traction.

Chugai Pharmaceutical declined on the back of weak prescription data for its oral obesity drug even while the company’s reported quarterly results were better than expected.

Its shares dropped -10% on disappointing second-quarter results that included a revenue-growth guide-down tied to three converging headwinds: manufacturer list-price reductions (IRA-driven), faster brand-to-biosimilar conversions at a large mail-order customer, and slower GLP-1 growth.

The Trump administration’s continued push to codify “most favored nation” (MFN) drug pricing into law raised concerns about long-term U.S. revenue growth, and the expiration of Novo Nordisk’s semaglutide patent in India in March 2026 opened the door for generic GLP-1 competition in emerging markets, adding to broader investor concerns about pricing power.

Some of the pain in the stock was in response to a guide-down in advertising revenue, as customers such as vaccine providers and GLP-1 companies have scaled back their spending.