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With much of the market’s attention on artificial intelligence (AI) and the stocks most closely associated with it, it can be easy to forget about a second but arguably equally impactful scientific development – that of weight loss drugs, known as GLP-1s in the industry (glucagon-like peptide 1).
GLP-1s have been around for several years and mostly used to treat type 2 diabetes. More recently, some have been approved by the FDA for treatment of obesity. Weight loss was the original side effect of these drugs because they activate receptors in the body to stimulate insulin release, which reduces blood sugar levels and curbs hunger.
For many financial market participants, the wakeup call
moment came in October last year when Walmart said that users of GLP1s, which
it distributes through its network, were buying less food. However, the recent hype around these drugs
can likely be more explained by clinical trials and pre-clinical studies that
suggest reduction of cardio events and even anti-addiction properties – all in
addition to helping people lose weight and lower their blood sugar levels. Our chart below illustrates how this has translated
into superior stock performance for the two leaders in the obesity arms race so
far. As with AI, momentum with GLP-1s
shows no sign of slowing down just yet.
