Investment briefing tomorrow; The miraculous new weight-loss drugs; Scott Galloway: 'you're going to see trillions of dollars of market capitalization reallocated and reshuffled'; My latest e-mail; Our 30th anniversary

1) Tomorrow, October 11, you're invited to a very special investment briefing...

I'm sitting down with investing legend Alex Green – a former money manager who has helped his readers beat the market by 158% over 20 years – to explain how a rare event could be able to completely rock the financial markets... in a unique new way that could create millionaires on just a single investment.

Some investors could see their wealth evaporate, but others could have the chance to earn big profits. Get the details – including how to put yourself on the list for tomorrow's full briefing – right here.

2) Longtime readers know that for more than a year I've been pounding the table on the new weight-loss drugs, Ozempic, Wegovy, and especially Mounjaro (tirzepatide), which has fewer side effects and results in the greatest weight loss.

I know more than a dozen people on Mounjaro and they're all thrilled, having lost large amounts of weight with few side effects.

One friend has lost 90 pounds in just over a year – I can hardly recognize him! Meanwhile, the worst outcome among my friends is a still-amazing 22-pound loss in five months.

The drugs work by suppressing appetite and cravings, resulting in steady weight loss of one to two pounds per week.

Here's a 60-page PDF I've put together with my commentary and various articles about these drugs. I've also created a new personal e-mail list to follow developments in this sector – if you wish to join it, simply send a blank e-mail to: weightlossdrugs-subscribe@mailer.kasecapital.com.

3) My friend and NYU marketing professor Scott Galloway shares my excitement about these drugs, and riffed on them last week in the Pivot podcast that he does with Kara Swisher (here are links to listen to it on Apple and Spotify). Here are my notes from the podcast...

Starting at 31:58, Scott says these drugs are the "biggest business story of the year, the biggest technological breakthrough since GPS and the iPhone." He thinks it could whack the stocks of companies like Walmart (WMT) and snack and beverage makers like PepsiCo (PEP), alcohol makers ("people on Ozempic consume 62% less alcohol"), United Airlines (UAL) says it could save $80 million annually from lower fuel costs, there will be in fewer knee replacements, you could see a baby boom because people who are slim feel better about themselves and their sex drive goes up, etc.

Studies show obesity leads to extra health care costs of between $170 billion and $1.7 trillion – 6% to 7% of GDP! The impact of Ozempic could be a multiple of the most optimistic assessment of AI on our economy. This is going to reshape health and our economy. "When a kid grows up obese, he or she is exponentially less likely to get married, more likely to be depressed, less likely to go to college, more likely to become a tax on the healthcare system, more likely to be impoverished because they can't afford their diabetes medication. I'm very excited!"

Scott returns to the topic at 58:50, saying the "industrial food complex, the snack food industry, some of the big box retailers, what I call the industrial obesity complex, hospital systems, the companies that make knee and hip replacements – I think you're going to see these companies hemorrhage market capitalization over the next 12 months. When all of a sudden 100 million people are eating and drinking less and all of the ramifications, whether it's diabetes, hip replacements, knee replacements, depression... I think there's going to be less therapy. You're going to have more sports. There will be a lot of winners too that we can't even project. Everyone's talking about AI, and it's going to grab the most headlines, but over the next five years the greatest shifts in market capitalization are going to happen because of the Ozempic economy, whatever you want to call it, the obesity economy, that's about to be disrupted. People don't even recognize how much of our economy is driven by obesity. And when that goes away, you're going to see trillions of dollars of market capitalization reallocated and reshuffled."

Scott isn't the only one who thinks these drugs will have a massive impact, as this New York Times article (The Disruptive Power of Weight Loss Drugs Is Being Felt Beyond Pharma), this Wall Street Journal article (America's Food Giants Confront the Ozempic Era), and this Morgan Stanley (MS) report note: Could Obesity Drugs Take a Bite Out of the Food Industry?

In summary, investors need to be thinking about these drugs and their first-, second-, and third-order effects...

4) Through my e-mail list, I've gotten to know four experts on obesity and the weight-loss drugs who have been kind enough to weigh in on the many articles and studies I send them. I quoted them extensively in this e-mail I sent to my weight-loss drugs e-mail list recently:

A) From Dr. Jason Fung:

Hey Whitney, Have a look at this new article in the Journal of the American Medical Association on the risks of Ozempic: Risk of Gastrointestinal Adverse Events Associated With Glucagon-Like Peptide-1 Receptor Agonists for Weight Loss.

The risk of pancreatitis is 909% higher than normal, bowel obstruction is 4 times normal and gastroparesis 3.6 times normal. Those are massively high hazard ratios.

Yes, while these drugs are relatively safe, there are real, serious side effects. The drug company studies don't show this because this data base was 16 million patients and these side effects are rare, and the drug company is always anxious to show the drug in the best light.

For sick patients, with type 2 diabetes or morbid obesity, GLP1s are worth it (I prescribe a lot of them), but for the person trying to lose 5 pounds for a high school reunion, or just joined Weight Watchers and gets sold Ozempic (because WW just bought an Ozempic pill mill) these are definitely not worth it.

Dr. Kevin Maki's comments:

I agree with Jason. All drugs have side effects and associated risks. People who are clinically obese are at increased risk from the obesity. The risk/benefit balance is favorable for them. People who want to lose a few pounds to fit into a dress or look good at a reunion are taking on an unfavorable risk/benefit ratio. Pancreatitis is rare but it can be life threatening. People who want to use a weight loss drug should do so under the supervision of a qualified (and ethical) healthcare professional who can discuss the risks and potential benefits with them so that an informed decision can be made.

Rich Weil of FitsMeHealth (Rich@fitsmehealth.com) comments:

Here is a list are the common, less common, and possible rare side effects of the top 12 medications used OTC and/or prescribed in the United States. For the life of me I cannot remember even one article on CNN, MSNBC, NYT, or other mass media where they sensationalized the side effects of these commonly prescribed meds (with the possible exception of hydrocodone).

My absolute favorite was on CNN Health: "They took blockbuster drugs for weight loss and diabetes. Now their stomachs are paralyzed." For some people, they must take these common meds for the rest of their lives. As I've mentioned before, the bias against weight loss meds comes from an extremely insidious and egregious, internalized bias against people with obesity. People think about people with obesity, "Why do they need meds to lose weight? Just eat less, exercise more, exert willpower and self-discipline, and put the fork down."

My comment: I agree with my doctor friends. Note that the study was done using semaglutide (Ozempic and Wegovy), NOT Mounjaro, which studies have shown (and many of my friends have told me) has far fewer side effects (AND results in greater weight loss) – so that's definitely the drug to use.

B) The biggest problem isn't these drugs' side effects but their COST, as this WSJ article notes: To Pay for Weight Loss Drugs, Some Take Second Jobs, Ring Up Credit-Card Debts. Excerpt:

Each month Tina Marie Porter pays about $1,000 out of pocket for Mounjaro. To make up for the extra monthly expense, the 49-year-old director of operations takes on more assignments and seeks odd jobs.

Porter belongs to a growing population of people taking extra measures to cover the full or almost-full price of popular drugs used for weight loss, after their insurance denied them coverage.

"It is life changing," said Porter, 49, of Kansas City, Mo. "But I shouldn't have to pay because my insurance won't cover it. It is making me healthier. It makes no sense."

Across the country, some consumers are paying $10,000 a year or more to get popular drugs from Eli Lilly and Novo Nordisk. Patients report taking on second jobs, racking up credit cards and cutting back on travel or family expenses to afford Lilly's Mounjaro, a diabetes drug being used off-label for weight loss. They are also self paying for off-label use of Novo's diabetes drug, Ozempic, and sister drug Wegovy, which is approved for weight loss.

The willingness of consumers to pay thousands of dollars of their own money underscores the public's appetite for more effective weight-loss medications, especially for people who have long struggled with obesity. The injectable medications can result in patients losing roughly more than 15% of their body weight.

Consumers are paying significant sums out of pocket in large part because insurers are denying coverage for weight loss. In addition, the drugmakers are charging the full list price of a drug instead of offering any of the discounts they give to health plans.

It's outrageous that these drugs aren't covered by every insurer (including Medicare and Medicaid), but this will take time...

Rich comments:

We have always considered that people with obesity have an addiction. Work at NIH, especially Norma Volkow and Gene Jack Wang in addiction research, amongst others, have shown down-regulation of dopamine receptors in people with addiction to substances such as cocaine, alcohol, and food. Which of course means they need more of the substance to get their fix.

It is not one bit surprising that people would do just about anything to acquire a medication that would help them lose weight safely and effectively. There has been research that asks people how hard they would work for food, tapping into the reward pathway and salience of food. Turns out people would go to great lengths to acquire food if they have a craving.

To be perfectly honest, none of the articles I have read on the topic of weight loss meds, since they became very popular, is the slightest bit surprising or informative to me. We, meaning, Betty and I, and most likely many of our colleagues, have known for decades what these folks with obesity are up against.

Neurobiology is extremely powerful, and when it affects appetite regulation, well, just as the article points out, people would do just about anything to acquire a substance of abuse. The possible good news here is that the news is finally coming to light that maybe the population will learn that obesity is a disease, and not a lack of willpower, self-discipline, or a character flaw.

But I doubt it will matter one bit. People are not getting proper education and information through the media. CNN, and pretty much all media, do not do an effective job at educating anyone about a complex problem such as obesity and appetite regulation, and certainly not brain biology; and to make it worse, Americans in general are not able to critically think about problems such as these like a scientist. They simply do not have the education in science, medicine, or obesity management, nor the proper analytical skills to question what they are reading.

So this article, and so many like it (I loved the headline where they said people were taking the weight loss meds and their stomachs were paralyzed), do almost nothing to inform the public of the real problems we as clinicians, and investigators, are up against. Media is very good at sensationalizing problems to sell their product. The deeper truth behind the problem just isn't quite that important, and certainly not as sexy as bold, attention-getting headlines.

C) Two of my cousins (brothers) who live in Washington state are on them and are happy with the early results, but are struggling to afford staying on them. One writes:

My brother and I were able to get 3 monthly doses or 12 pens using the savings card for $500 per box, but the card appears to expire and then it's $1,000+ per box... ouch! I used Walgreens who made it a huge pain every time; my brother used Costco, which seemed to work better.

Any chance you could try to find out more what the trick is to get it long-term without having to jump through all the hoops every time? I'm going to try printing a new savings card and hope that it works at least three more times, grrrr... thx!

My cousins need to be careful because there are a lot of scammers out there, as this Washington Post article highlights: Inside the gold rush to sell cheaper imitations of Ozempic. Some "compounding pharmacies" are legit, but many are not. One friend who's lost 90-plus pounds on Mounjaro over the past year writes:

There are pharmacies that apparently can compound Mounjaro, but (with insurance) I'm able to get the real drug for $400 (about the same price as the compound version). Even my doctors who have used them caution that it's not the same as the real thing, so if you can afford it, they strongly recommend using the real script.

Rich commented:

Your cousins should call their doctor and check the web site of the drug company and call the company directly. And ask the drug companies about rebates. Those are the most effective methods. And then persistence. Don't give up, keep calling.

If they're on Mounjaro and they do not have diabetes , then the drug company may decline because they and some insurance companies have started requiring doctors to write a diagnosis of diabetes on the prescription (and pre-diabetes won't cut it). We still have some patients on Mounjaro who do not have diabetes, but it seems to be luck of the draw, there's no rationale that we can pick up on. In fact we have a patient who does not have diabetes and their insurance covered Mounjaro but would not cover Saxenda. It makes no sense. But that's where we are at the moment and I don't know how long it will be until the dust settles.

But Wegovy and Saxenda are approved for weight loss. Wegovy is the second most effective medication behind Mounjaro in our experience. There is also Saxenda, although it's a daily injection. They can try one of those. They should call their insurance company to see if they will cover one of those, and like I said, be assertive, persistent and pushy.

D) One idea: order them from overseas. As this article notes, they're MUCH cheaper everywhere else in the world (like almost all drugs – another outrage): How do prices of drugs for weight loss in the U.S. compare to peer nations' prices?

E) From the front page of the New York Times on August 18: We Know Where New Weight Loss Drugs Came From, but Not Why They Work. Rich commented:

This is a long and detailed article, very well covered. The Gila monster story made a huge splash when it was first reported. In 2006 I had the privilege of being selected for the "Diabetes Dream Team" by Becton-Dickinson (https://investors.bd.com/node/9631/pdf) where five diabetes professionals took care of five patients with diabetes to show how intensive care improved diabetes. We prescribed Byetta (exenatide) to some of the patients, the first GLP-1 agonist, and patients lost weight. So GLP-1 agonists are not a new story.

I'd like to respond to just one point in this NYT article, the issue of having to exercise caution because the medication may be needed for life.

They say in the article: "Although the drugs seem safe, obesity medicine specialists call for caution because – like drugs for high cholesterol levels or high blood pressure – the obesity drugs must be taken indefinitely or patients will regain the weight they lost."

I offer no apologies for stepping on my soapbox. I don't hear anyone complaining about people having to take medications for life to control and manage hypertension, depression or other mental health problems, heart, asthma, diabetes, and many, many other medical conditions. I think the issue of caution about taking obesity medications for life stems from an intrinsic bias against individuals with obesity.

People, including doctors, think, "why can't people just lose weight on their own? Why do they need medication?" People attribute the obesity to a lack of willpower, character flaw, or lack of discipline. We have known for a very long time that obesity is a chronic disease, complicated by many, many, factors, just two of which include genetics and the neurobiology of appetite regulation.

I have never in my 40-year career in weight loss and diabetes met anyone who woke up one day and thought how cool it would be to struggle with their weight and develop obesity. Obesity is a chronic disease, and if there is finally a safe and effective medication that you have to take for life, and maybe just once a week, to control this disease, then why not support it? Like every other medication, there is the potential for complications, and these can be monitored. Anyone ever heard of rhabdomyolysis from statins? So it's time we stop blaming the patient and be grateful there is relief for people who have been shamed and demoralized their entire adult life, or even their whole life, by body weight.

Every single participant in mine and Betty's weight loss program is so grateful for the relief and the edge they get from the weight loss meds. For the first time they leave food on their plate, have fewer or no cravings, experience satiety, and report less "noise" about food in their head. How can this possibly be a bad thing?

Thank you, Jason, Kevin, Rich, and Betty!

I will continue tomorrow with my experts' further commentary on the causes of obesity epidemic and many other related topics... Stay tuned!

5) Lastly, Susan and I are celebrating our 30th anniversary today!

Here's the first picture of us shortly after we met in September 1990:

Best regards,

Whitney

P.S. I welcome your feedback at WTDfeedback@empirefinancialresearch.com.