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Despite all its potential, the obesity market has still failed to take off, and the drug development pipeline is a slow moving roller coaster: the odd novel agent emerges, the odd novel agent fails, and R&D investment is lacking (see other blog). There is a great unmet need, high prevalence, and a solid and growing appreciation of the long-term physical and financial implications resulting from chronic obesity. Moreover, the obesity epidemic feature in the press on an almost daily basis. 

Obesity is often overlooked by busy physicians, and there are still those who consider obesity purely as the result of poor life choices. Moreover, knowledge and awareness of therapeutic options is poor, aside from the fact that several obesity drugs have been discontinued due to serious safety issues. Hence, diagnosis and treatment rates are low for obesity, meaning the pool of drug-treated patients is lower than might be expected considering the obvious prevalence. And this is likely a large part of the reason why more drug companies are not involved in R&D for obesity and why those that are have set relatively high prices for their products. Hence, despite the obesity epidemic, the U.S. market is dominated by phentermine, an old, cheap, generic short-term therapy, with novel branded agents struggling to gain traction. In Europe and Japan, there are very limited pharmacotherapeutic options.

Fat prices, slim revenues

The treatment gap between lifestyle modifications and metabolic surgery remains a gap that medication should fill but hasn’t. Why? As mentioned, even in the United States, where obesity is ubiquitous and health care spending is high, several recently approved antiobesity drugs have failed to take off.

I think where the developers have gone wrong is, ironically, by being greedy. Treatment prices are just too high. The risk-benefit profiles of the most recently approved drugs are just not good enough to command the prices set – Vivus’s Qsymia, Arena Pharmaceutical/Eisai’s Belviq, and Orexigen’s Contrave/Mysimba all have safety issues that make prescribers and payers think twice. Physicians, payers, and patients are all asking why they should pay around $200/month for slow and often modest efficacy but plenty of side effects. Only Novo Nordisk’s Saxenda may sustain a higher cost: it is a complex molecule with injectable administration, and physician and payer confidence has already been established through use of the same molecule for type 2 diabetes. On top of this, not enough time and money has been invested in medical education about obesity and the available drug treatments.

 Endocrinologist quote

Everything in moderation

What developers must remember is the high prevalence of the disease could have massive impacts on budgets for payers should diagnosis and treatment rates increase. Prices need to provide the flexibility and affordability to optimise market access, and developers might need to lower pricing strategies to secure higher revenues. A balance is required to avoid a vicious cycle of high prices requiring limited access, which encourages high prices. If drugs come even close to ‘getting it right’, they will sell. Roche’s Xenical is the most obvious example. It has a poor tolerability profile with modest efficacy, and is relatively expensive, but it is safe and there was little or no competition leading to peak sales easily exceeding $500 million. If companies can develop a safe and even moderately effective drug, and price it for the masses (no pun intended), as well as really pushing the message that medication can help reduce the increased rates of cancer, diabetes, heart attacks, and death associated with obesity, stakeholders will pay attention.

In-depth analysis of obesity, with accompanying epidemiology driven sales forecast models, is presented in Decision Resources Group’s Obesity/Overweight Insights, available here.