The buzz around GLP-1 drugs for weight loss grew louder in 2023, dominating news headlines, equity research reports, and TV commercials.

While glucagon-like peptide 1, or GLP-1, drugs have been safely used for nearly two decades to treat type 2 diabetes, the use of such drugs for weight-loss indications, both on and off label, has gained significant traction over the past several years.

Moreover, pharmaceutical manufacturers have invested heavily in developing novel GLP-1 drugs for weight-loss indications, or in acquiring manufacturers to help strengthen their existing market positions. The market for GLP-1 medications appears poised to expand markedly over the coming years.

In the most recent edition of his Healthcare Mosaic report, William Blair equity research analyst Ryan Daniels takes a deeper dive into the growing impact of GLP-1 drugs on healthcare spending and care delivery, along with the concomitant need for healthcare services and digital health providers that can help employers and consumers effectively manage the emerging wave of GLP-1 drugs.

In the 33rd edition of Healthcare Mosaic, Daniels analyzes:

  • The growing prevalence of, and demand for, GLP-1 drugs used for weight-loss indications
  • Trends regarding insurance coverage for GLP-1 drugs for weight loss
  • The potential near- and longer-term economic impact of this trend for payers and employers
  • The need for navigation, telehealth, and digital health solutions to help payers, patients, and employers maximize value from GLP-1 drugs through personalized treatment plans (which he believes are key to optimal long-term outcomes)
  • The potential market opportunity for digital health vendors targeting the GLP-1 services and care management market
  • An overview of select companies—in both the public and private markets—that he believes are well positioned to benefit from these trends

Daniels expects that the use of such drugs for weight loss will remain a widely debated topic across the healthcare industry.

“In our view, this conversation likely will revolve around the long-term impact to payers, manufacturers of drugs and devices, and patients as well as a host of topics ranging from drug coverage and health equity to long-term drug pricing,” Daniels wrote. “Still, we believe one undeniable aspect of the use of GLP-1 therapy for weight loss will be the concomitant need to support patients along their health improvement journey, and we see a key role in this market for a wide variety of digital health providers and care ecosystems in doing so.”

To request a copy of the full-length Healthcare Mosaic report, or for more information on the companies from Ryan’s coverage list, please contact us or your William Blair representative.