Generic Weight-Loss Drugs Won’t Come for Years
Eli Lilly
LLY
0.21%
and Novo Nordisk enjoy the highest values in the pharma sector, as investors expect years of high-volume, high-price sales for their GLP-1 weight-loss drugs: Lilly’s Zepbound, and Novo’s Wegovy.
One limit to those vistas will be the arrival of generics. So Guggenheim analyst Seamus Fernandez checked what some of the big generic drugmakers have been saying about the booming GLP-1 category. Many are making plans, but according to the analyst’s Aug. 16 note, Novo and Lilly won’t face substantial competition in the U.S. or Europe until the early 2030s.
The big generic firm Teva Pharmaceutical Industries already launched the first GLP-1 generic, an injectable drug known as liraglutide, at the end of June. It’s a generic version of a first generation GLP-1 that Novo launched years ago, under the names Victoza and Saxenda. Other generic makers will follow with liraglutide launches this year.
Like other first generation GLP-1s, however, liraglutide produces only a fraction of the weight-loss that Wegovy or Zepbound can achieve. Fernandez doesn’t think liraglutide will affect their demand.
The active ingredient in Wegovy goes by the chemical name semaglutide. The first place an expiring patent will allow generic semaglutide to appear is Canada. The Swiss generic company Sandoz plans a launch there in 2026.
“Clearly this is a space that we’re intending to go after,” said Sandoz CEO Richard Saynor, when asked about GLP-1s on its Aug. 8 earnings call. After Canada, semaglutide patents will expire in some other countries, for use as a diabetes treatment. Saynor said that sales won’t amount to much until the early 2030s, when the U.S. and European patents expire.
Many of the leading generic manufacturers are based in India, and several mentioned the category in their June quarter calls. Fernandez cites Biocon, Cipla, Divi’s Labs and Sun Pharma for plans to launch liraglutide in the U.S. and other markets. They are considering other GLP-1s for India’s home market, which doesn’t recognize every international drug patent.
The U.S. generic firm Viatris also said it is laying the groundwork to compete in GLP-1s. On its own Aug. 8 earnings call, research chief Philippe Martin said the company had its eyes on liraglutide, a semaglutide rival for Novo’s Wegovy, as well as a version of Lilly’s Zepbound, which has the generic name of tirzepatide.
“We anticipate we’ll have a significant role going forward in that GLP-1 market,” Martin said. Viatris’s plans are surely long term, since Lilly’s patents on the compound tirzepatide don’t start expiring until 2036.
Lilly and Novo are hard at work developing new kinds of GLP-1 drugs, as well as other weight-loss treatments. But semaglutide and tirzepatide will be big markets for generics to target.
Novo’s European Union and U.S. patents on semaglutide as a compound expire in 2031 and 2032, respectively. But Fernandez says Novo is working to extend its exclusivity by wrapping the drug with other patents. Such patent defenses are what keep lawyers employed, at generic and branded drug firms.
Fernandez sees a good number of untroubled sales for the two GLP-1 pioneers.
“The threat of competition from generic semaglutide—particularly given the extraordinary capital expenditure necessary to deliver billions of injection devices—looks to be ~7 years off,” he writes.