GLP-1 Drugs for Diabetes and Weight Loss

GLP-1 agonists are a class of medications used to treat type 2 diabetes. Besides helping to lower blood sugar levels, they also suppress appetite and reduce calorie intake — fueling their growing popularity as obesity drugs. 

According to the Centers for Disease Control and Prevention (CDC), the prevalence of obesity in the U.S. has grown from 30.5% over 1999–2000 to 41.9% over 2017–2020.

GLP-1s have been used to treat Type 2 Diabetes since 2005, starting with the approval of Byetta, with follow-on products continually improving on efficacy. The most recent, Ozempic and Mounjaro, offer significant advantages over previous products and have accelerated usage.   The newest generations of GLP-1s and combos lead to 15–25+% weight loss on average, well above prior generations of products. 

Today, GLP-1s are used by around 10-12% of Type 2 Diabetes patients in the U.S. This usage could expand to around 35% of diabetics in the U.S. in 2030. In addition, 15 million obese patients could be on GLP-1s by the end of the decade. Overall, total GLP-1 users in the U.S. may number 30 million by 2030 — or around 9% of the population. 

The GLP-1 landscape is currently dominated by two major players: U.S.-based Eli Lilly and Denmark-based Novo Nordisk. Demand could continue to outstrip supply for the next several years in the longer term more plants will be built and more competitive oral options will become available. 

These drugs could solve two chronic problems in insured populations, reducing claims costs arising from the variety of illnesses that follow from diabetes and obesity.  Those with obesity might have other serious chronic health conditions, including diabetes and high blood pressure, which are leading risk factors for heart disease and stroke. The data also shows that people living with obesity paid more annually in medical costs than their lighter counterparts ($3,097 versus $1,861 per person), totaling $173 billion in medical expenditures. These injectable therapies are recommended by the American Diabetes Association to lower the chances of heart attack and stroke in patients with diabetes.

The average annual list price of GLP-1s is $12,000 and, according to a Peterson-KFF tracker, most large employer health plans restrict coverage for weight loss.

Source: JP Morgan (2023) and NCLS (2024)