As they do each summer time, publicly traded firms posted their second-quarter outcomes whereas People had been baring their our bodies on the seashore. However this 12 months, the timing was apt. On a number of earnings calls in August, chief executives reassured buyers that the Ozempic revolution had not left them within the mud, and that they may in some way share within the blazing success of latest diabetes and weight reduction medicine.
“It puts us in a good position to be a solution for those who are on the drugs,” stated Dan R. Chard, the chief govt of Medifast, which makes food plan merchandise like shakes and protein bars, including: “They’re looking for guidance.” He instructed analysts this even whereas explaining that new-generation medicine had helped pummel earnings, down 34.7 % 12 months on 12 months.
“We will continue to study this,” Michael Johnson, the chief govt of the dietary complement maker Herbalife, instructed buyers. “And when we see an opportunity to capitalize on it, we will.”
In concept, that chance — each for making earnings and for shedding fortunes — may very well be huge not just for the businesses behind these medicine but in addition for some in utterly completely different industries.
Often known as GLP-1 medicine, the drugs are already driving huge earnings. Novo Nordisk makes each Ozempic, which has been authorized just for Sort 2 diabetes, and its shut relative Wegovy, which has been authorized for weight reduction. They mimic a glucagon-like peptide that regulates urge for food within the mind, leaving folks feeling sated for hours. Collectively, they helped ship Novo’s earnings rocketing up 32 % within the first half of this 12 months, and Novo’s market worth is now bigger than your complete Danish economic system. Eli Lilly’s gross sales surged 28 % within the second quarter, thanks to a different diabetes drug, Mounjaro, which the Meals and Drug Administration might approve for weight reduction this 12 months.
And the total potential isn’t even clear but. The marketplace for weight reduction medicine is big: There are roughly 750 million overweight folks worldwide, together with about 42 % of adults in the US, the place obesity-related sicknesses incur billions of {dollars} in well being care prices every year. However Novo says GLP-1 medicine might ultimately produce other makes use of, like serving to stop heart problems amongst overweight adults. There are indicators they may deal with dependancy and even Alzheimer’s, too.
“The market potential is very, very significant,” Novo’s chief monetary officer, Karsten Knudsen, instructed me after I visited the corporate in June. “We’re operating in kind of unusual territory.”
Eating regimen firms are bracing for disruption. For many years, weight reduction firms have relied on branded, prepackaged meals and life-style packages. Some, like WeightWatchers and Noom, have raced to promote GLP-1 medicine themselves, whereas others nonetheless hope their merchandise can survive the Ozempic period. Jenny Craig shut its weight reduction facilities in Might after 40 years. And Merely Good Meals, which distributes Atkins food plan merchandise like frozen meals and cookies, will market Atkins as “a perfect complement to people thinking about using the drugs,” the corporate’s chief govt on the time, Joe Scalzo, instructed analysts in June.
The ripple results are widening. Retailers like Walmart, Kroger and Ceremony Support say GLP-1 prescriptions are bringing extra folks into shops, the place they make different purchases. Walmart’s chief govt, Doug McMillon, instructed analysts in August that its executives “expect consumables, and health and wellness, primarily due to the popularity of some GLP-1 drugs, to grow as a percent of total.”
Medtronic’s chief govt, Geoff Martha, stated the corporate had seen a “modest” dip in bariatric surgical procedure, presumably as folks opted for weight reduction medicine as a substitute. And a few analysts consider the medicine might disrupt the American food plan.
“If you’re eating fast food every day, you’ll probably continue to eat fast food every day,” James van Geelen of Citrinas Capital Administration stated on Bloomberg’s “Odd Lots” podcast. “You will just eat a lot less of it.”
Nonetheless, there’s room for different approaches to combating weight problems. “These drugs are game changers, but with an asterisk,” stated David Ludwig, an weight problems specialist and pediatrics professor at Harvard Medical Faculty. (The medicine include an extended checklist of unwanted side effects.) “Even if you can reduce weight across the population with drugs, it’s not going to eliminate the risks of a poor diet.”
Flush with money, Novo agrees. “We need to be looking at what’s the next thing,” its govt vp for industrial technique Camilla Sylvest, instructed me. In June, the corporate launched an weight problems prevention unit close to Copenhagen, to analysis how one can cease the illness earlier than folks must take medicine to drop a few pounds. — Vivienne Walt
IN CASE YOU MISSED IT
The U.S. labor market begins to appear like its previous self. Employers added 187,000 jobs in August, the Labor Division reported Friday, and unemployment rose to three.8 % because the economic system continued to lose momentum constructed up after pandemic lockdowns.
Commerce Secretary Gina Raimondo visits China. She had the difficult process of selling commerce between the 2 superpowers whereas holding agency on know-how export limits imposed within the title of American nationwide safety. The 2 international locations agreed to create new dialogues, together with a working group for industrial points.
The White Home names the primary medicine set for Medicare value negotiations. The long-awaited checklist of 10 medicines will likely be topic to a landmark new program meant to cut back prices for Medicare. Drugmakers have pushed again in opposition to the plan, together with in courtroom, and Republicans have criticized the initiative as authorities overreach.
UBS studies a $29 billion quarterly revenue, with an asterisk. The massive achieve — the largest in banking historical past — stems from the financial institution’s acquisition of its rival Credit score Suisse this spring for about $3.2 billion, a steep low cost that’s skewing UBS’s outcomes. But it surely belies the challenges that UBS faces because it strikes to finish the biggest takeover of a financial institution for the reason that 2008 monetary disaster.
The final lady boss
When Emily Weiss stepped down final 12 months because the chief govt of Glossier, the skincare and sweetness model she based in 2014, some referred to as it the top of the “girlboss.” That archetype — of media-savvy feminine founders with venture-darling, millennial-focused start-ups — had been propelled by “#Girlboss,” the Nasty Lady founder Sophia Amoruso’s 2014 memoir.
Glossier, with its direct-to-consumer mannequin and voice-y web site, modified the way in which ladies purchase make-up, ultimately passing a $1 billion valuation. However the model stumbled because it struggled to maneuver into brick-and-mortar retail; confronted criticism from retail staff who alleged a poisonous, racist working surroundings; and shelved initiatives like a make-up line that departed from its dewy, barely-there look.
DealBook spoke to Marisa Meltzer, writer of the upcoming guide “Glossy: Ambition, Beauty, and the Inside Story of Emily Weiss’s Glossier,” about what classes we’d glean from Weiss and the #Girlboss motion.
This interview has been edited and condensed for readability.
Are you able to contextualize the #Girlboss motion?
It was fairly offensive and diminutive. Nobody aside from Sophia was calling themselves out as a girlboss. But it surely was additionally one thing that benefited them as a result of it attracted curiosity. It was a means for them to get press about their companies that wasn’t the standard issues that feminine founders and C.E.O.s typically needed to do, like a vogue unfold.
There was a giant debate on the time over whether or not the press would have lined the scandals at firms like Out of doors Voices, Man Repeller and Glossier in another way if that they had males on the helm. What do you suppose?
I believe there was a little bit of a thirst for blood. These ladies had been propped up in a means that was form of annoying — I’m certain it was annoying to them, too.
A few of these firms had actual issues, like being sued over firing pregnant staff. And different firms had, like Glossier, an accusation of getting a office, largely for his or her retail staff, that wasn’t very best. That’s completely different than felony conduct.
The fact is these firms weren’t the identical. The ladies at their helms weren’t all the identical. They usually weren’t making the identical errors. They usually additionally didn’t have the identical stage of success.
What occurs to Glossier now?
Glossier appears to have taken the time since Emily stepped all the way down to re-evaluate. They determined to actually belatedly go into retail. They launched in Sephora final February. The bigger process that they’re making an attempt to do is make the corporate in higher form for an exit.
Who would possibly purchase them?
An organization like Estée Lauder that owns a number of boutique manufacturers would make sense. There’s additionally Kering, the style home that owns Gucci, which has been making some seen performs to get extra into the sweetness market.
On our radar: The story of Carlos Ghosn
In 2019, whereas dealing with felony fees of monetary wrongdoing, the previous Nissan govt Carlos Ghosn skipped bail and fled Japan in an elaborate plot that concerned a personal jet and a trunk with respiratory holes drilled into it. On the time, DealBook referred to as it “a movie-level caper,” and two initiatives — one by the BBC and one other by Netflix — had been fast to painting it on video. However neither did so in addition to a four-part Apple TV+ documentary collection that was launched final week.
“Wanted: The Curious Case of Carlos Ghosn” is produced by The Wall Road Journal and relies on a guide by two of its reporters. With Ghosn’s participation, it tells the thriller-like drama of one of the vital memorable enterprise tales this decade whereas exploring its nuances.
“The series explicitly poses the question of Carlos Ghosn: victim or villain?” The Guardian’s Adrian Horton writes. “With blurred lines, overlapping narratives and convoluted paper trails, it doesn’t land on a simple answer.”
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