Credit: Visual China

BEIJING, July 11 (TMTPost) —— The first GLP-1 class weight loss drug called liraglutide produced by China has been approved for sale recently.

The news put the producer Huadong Medicine in the spotlight and market observers started to examine the capital movements at the same time.

According to the Insight database, Huadong Medicine and many other Chinese enterprises such as Zhejiang Hisun Pharmaceutical Co., Ltd. and Hengrui Pharmaceuticals, and global pharmaceutical giants such as Novo Nordisk and Pfizer are competing for the Chinese market through increasing R&D of weight loss drugs.

Medical industry sources told TMTPost that capital has flowed to the market of weight-loss drugs, due to the promising market size of this industry. According to public data, Novo Nordisk and other companies have achieved good results in the weight loss drug segment in recent years. However, companies also need to consider risks such as side effects of weight loss drugs and Chinese consumer acceptance.

According to Frost & Sullivan data, the Chinese weight loss market was about 2.1 billion yuan in 2021, with a compound growth rate of 71.4% from 2017 to 2021, and the market size is expected to reach 11.1 billion yuan in 2026. Barclays Bank estimates that the value of the global weight loss market could exceed $100 billion in the next 10 years.

According to the Report on the Nutrition and Chronic Disease Status of Chinese Residents (2020), more than 50% of adult residents in China are overweight or obese, and the rates of overweight or obesity among children aged 6-17 and children under the age of 6 have reached 19% and 10.4%, respectively. Therefore, weight control for overweight and obese patients has become an urgent clinical need.

Ping An Securities predicts that China's weight loss drug market will reach 14.9 billion yuan in 2030, with a CAGR of 22.9% from 2023 to 2030. Cai Tong Securities' research report predicts that as of 2019, there were 192 million Chinese people aged over 18 with overweight and obesity problems. It is expected that in 2025 the regulated market for weight loss drugs is expected to exceed 12 billion yuan.

Novo Nordisk's annual report data also verified the value of the market in the United States and other places. It showed that Novo Nordisk 2022 weight loss drug sales of 16.9 billion Danish kroner ($2.49 billion), a substantial increase of 88%, of which liraglutide's global sales totaled 10.676 billion Danish kroner (about $1.57 billion). Another heavyweight loss drug called semaglutide was released not long ago but also contributed a lot to sales.

Driven by sales of the weight loss drugs such as simepaglutide, the market value of Novo Nordisk soared to a high of 172.97 U.S. dollars per share last Friday from a low of 94.17 U.S. dollars per share in September 2022 . As of the close of trading last Friday, the company's total market capitalization reached 311.8 billion U.S. dollars, bigger than those of Pfizer and other biomedical giants.