Lilly executives warn that "weight loss drug" may still be in short supply by 2025

The market for new weight loss drugs continues to be booming, with products from the two giants Novo Nordisk and Lilly in short supply. A senior executive at Lilly stated that the company may not be able to meet demand this year, and may even be unable to keep up with demand by 2025.

Anat Ashkenazi, Chief Financial Officer of Lilly, stated at TD Cowen's annual healthcare conference on Wednesday that although Lilly is embarking on the most significant expansion plan in company history, increasing production capacity will take time.

Ashkenazi added that even by 2025, Lilly may not be able to meet the market demand for Zepbound and Mounjaro.

Zepbound and Mounjaro both belong to a class of drugs called GLP-1 (glucagon like peptide-1), which works by inhibiting appetite and delaying gastric emptying to lose weight. Patients can lose an average of 15% -20% of their weight after use. Danish pharmaceutical giant Novo Nordisk's weight loss drug Wegovy also belongs to the GLP-1 drug category.

Last November, the US Food and Drug Administration (FDA) approved Lilly's Tirzepatide injection for weight loss under the name Zepbound. In addition, the FDA approved Tilporide for the treatment of type 2 diabetes in May last year. The drug is called Mounjaro.

According to research firm GlobalData, Novo Nordisk and Lilly's weight loss drugs are expected to generate $18.2 billion in revenue this year.

Due to the shortage of weight loss pills, both Novo Nordisk and Lilly are eager to expand their production capacity.

Novo Nordisk last month spent $11 billion to acquire three filling plants formerly belonging to Contilent for the production of Wegovy and its diabetes drug Ozempic. However, these three factories will not be able to help Novo Nordisk increase production capacity until 2026.

According to experts, although the production of Tirzepatide and Semaglutide (the active ingredient of Wegovy) requires a complex fermentation process, Lilly's drugs are more difficult to produce because they contain two natural amino acids.

Jim Miller, a consultant who provides production strategy consulting for pharmaceutical companies, warns that supply constraints will not be resolved soon.

Miller stated that Lilly and Novo Nordisk will not always be unable to meet market demand, but it usually takes three to five years for a factory to be built and put into operation.