Obesity is good business for Novo Nordisk

Novo Nordisk, maker of the in-demand weight-loss treatment Wegovy, saw its sales increase by more than 25% last year, as revenue from its obesity business doubled.

The numbers, disclosed yesterday, help explain the pharmaceutical gold rush into a new class of medicines called incretin mimetics, diabetes drugs that have proved to spur dramatic weight loss for patients diagnosed with obesity. Eli Lilly, Amgen, and Pfizer are developing similar medicines, and analysts expect the market for them to reach $90 billion by 2030.

But those lofty projections will depend on whether treatment with powerful weight-loss drugs can lead to long-term health benefits. We'll find out later this year when Novo Nordisk reports data from a five-year, 17,500-patient study testing whether Wegovy can reduce the number of cardiovascular problems relative to placebo. Decades of medical conventional wisdom suggest it'll work, but there are no prospective, randomized trials establishing a link between obesity and cardiovascular disease. And there's no guarantee the trial, which is relatively short for an outcomes study, will favor Wegovy. If the study isn't clearly positive, payers will likely limit the use of incretin mimetics, making Wall Street's sales forecasts all but impossible.

Health Tech
Verily, now streamlined, comes into focus

Verily, the Alphabet spinout that once harbored Star Trek-inspired ambitions, is laying off employees and streamlining its expansive business to home in on things that actually make money. A new clinical trial, focused on depression, offers some clues to the company's future.

As STAT's Matthew Herper and Casey Ross report, Verily is working with the Japanese pharmaceutical company Otsuka to study centanafadine, a novel antidepressant. Verily's role will be using technology to enroll patients remotely and gather essential data without requiring visits to a doctor's office, all with the goal of reducing the variability that has made depression studies among the most unpredictable in drug development.

The study is a milestone for Verily, Chief Medical Officer Amy Abernethy said, as the company worked in concert with Otsuka to design a digitized trial. But it could also be a preview of Verily's next act, as the company jettisons older projects such as remote patient monitoring for heart failure, microneedles for drug delivery, and its health system analytics tool.

Venture capital

Biotech investors are short-changing addiction treatments

Over the last decade, venture capitalists have invested just $136 million into novel medicines for addiction despite escalating demand for new options.

As STAT's Lev Facher reports, there are about as many Americans living with addiction as there are diagnosed with cancer, and yet investors poured nearly $36 billion into oncology in the same time period, according to numbers from BIO, the biotechnology industry trade group.

Part of the problem is scientific. Researchers have struggled to pinpoint the underlying biological causes of addiction, making it difficult to discover new medicines that might help. The other barrier is a practical one: Insurers have long been unwilling to pay for novel addiction treatments, sapping the incentives for pharmaceutical companies and their financial backers to invest in them.

Genome Sequencing

What if Illumina's crumbling merger was actually good for competition?

Illumina's $8 billion acquisition of the cancer-testing firm Grail has become a regulatory and business boondoggle, enflaming antitrust authorities and alienating shareholders who want the company to stop throwing good money after bad. Now, contrary to conventional wisdom, it might be eroding Illumina's core business, too.

That's according to a Financial Times feature on why the merger is likely to fall apart (Illumina's customers are Grail's competitors) and why Wall Street hates it anyway (running Grail at arm's length is bad for earnings). Interestingly, Grail's competitors are concerned enough about Illumina raising prices on them that they're taking their business elsewhere, the sequencing firm Element Biosciences told the FT.

That suggests Illumina controlling Grail could at once harm competition in the market for cancer blood tests and increase competition for genomic sequencing, a market it dominates. That would mean, by buying Grail before winning regulatory approval, Illumina might have unwittingly benefitted its competitors while wasting money on a doomed merger.

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