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Eli Lilly’s weight-loss treatment, Zepbound, secured approval from both U.S. and UK regulators on Wednesday, setting the stage for a robust challenger to Novo Nordisk’s Wegovy in combating surging obesity rates.

Both drugs stand out as highly effective weight-loss treatments, anticipated to vie in a global market projected to hit a staggering $100 billion by the decade’s end.

Novo Nordisk’s medications have demonstrated significant weight loss among patients, reshaping the landscape for sellers of sugary foods and drinks. Additionally, they’ve affected healthcare providers managing obesity-related conditions like diabetes, sleep apnea, and manufacturers producing devices for bariatric weight-loss surgeries.

However, criticisms have arisen concerning the high cost of these medicines, rendering them unaffordable for many afflicted by obesity.

Lilly’s tirzepatide, marketed as Mounjaro for type 2 diabetes since 2022, has been increasingly utilized “off-label” for weight loss while awaiting obesity approval. It is set to debut on U.S. shelves as Zepbound later this month and in the UK shortly thereafter, according to the company.

Zepbound will retail at $1,059.87 per month, a lower price compared to Novo Nordisk’s Wegovy at $1,349 per package. Novo Nordisk has faced restrictions in supplying the treatment to a limited number of patients.

Damien Conover, an analyst at Morningstar, highlighted the significance of after-discount net prices negotiated by pharmacy benefit managers, suggesting that despite Zepbound’s lower list price, these final costs will be pivotal.

While Novo Nordisk is preparing to unveil new cardiometabolic disease data, including findings from its SELECT trial at the American Heart Association Scientific Sessions, Conover believes these statistics could shift Wegovy’s perception from a lifestyle drug to a more accepted treatment among payers.

Conover emphasized that Zepbound’s approval positions it as a potential best-selling drug of all time.

Lilly disclosed that Zepbound will not be included in U.S. insurance coverage formularies at the start of 2024 but is anticipated to gradually expand throughout the year.

The anticipation of Zepbound’s approval has significantly boosted Eli Lilly’s shares by 67% in 2023, establishing it as the most valuable publicly traded healthcare company globally. Even with the widely expected approval, Lilly’s shares surged over 3% on the day of the announcement.

The regulators in the U.S. and UK approved the Lilly drug for use by adults with a body mass index (BMI) of at least 30 or a BMI of 27 coupled with another weight-related health issue, such as heart disease.