Billion-Dollar Weight-Loss Drugs Face Market Chill: Three Key Challenges Behind the Industry's Struggles

When it comes to obesity, citing specific figures can often feel somewhat awkward; nevertheless, we will provide some reference data here. According to data released by the U.S. Centers for Disease Control and Prevention (CDC) in 2015, 37.9% of U.S. adults aged 20 years and older were obese during the 2013–2014 period, defined as having a body mass index (BMI) greater than 30. When including those who are overweight, this proportion rises to 70.7%, exceeding two-thirds of the total population.

Obesity is a disease that can affect our health in countless ways and also drain our wallets. According to McKinsey’s 2014 report, obesity imposes an annual economic burden of over $2 trillion globally, and this figure continues to rise.

Therefore, it is hardly surprising that the weight-loss product market in the United States is so vast. According to estimates by Marketdata, global consumers spend approximately $66 billion annually on these products and services, the majority of which lack proven efficacy.

Even when we consider all the above figures and factors together, one question remains puzzling: Why are the majority of FDA-approved weight-loss drugs largely ineffective? MedCity News has conducted an in-depth analysis of the current dilemmas facing the weight-loss drug market and future strategies. VCBeat (WeChat ID: vcbeat) has compiled the latest insights for you.

Michael Narachi is the CEO of Orexigen, a company based in San Diego, California, and he has been closely monitoring developments in the weight-loss product sector since 2009.

Previously, after numerous twists and turns,Orexigen’s weight-loss drug Contrave finally received FDA approval in 2014. However, compared with other prescription weight-loss medications launched by competitors during the same period, such as Vivus Pharmaceuticals’ Qsymia and Arena Pharmaceuticals’ Belviq, its sales fell far short of the anticipated $1 billion.。

Three years on, doctors remain reluctant to prescribe weight-loss medications.

“The root of the problem is that, during the era when many doctors received their medical education, obesity was not classified as a disease,” said Narachi helplessly from his ocean-view office in La Jolla. It was not until 2013 that the American Medical Association (hereinafter referred to as the AMA) reversed the medical status of obesity, although this decision remains quite controversial.

“Describing it as a fierce struggle may be somewhat biased, but the AMA was at least gritting its teeth when making this decision,” he continued.

The AMA’s vision is to legitimize obesity as a disease, thereby encouraging the healthcare community to treat patients for obesity itself, rather than focusing solely on its complications, such as heart disease and type 2 diabetes.It seems they achieved a symbolic victory, but the actual situation is changing very slowly.

Dr. Ania Jastreboff is an Assistant Professor of Adult and Pediatric Endocrinology at the Yale School of Medicine and one of the few specialists in the United States focusing on obesity. In a telephone interview, Dr. Jastreboff acknowledged that greater efforts are still needed to educate and train physicians on obesity.

“Obesity was never previously regarded as a disease, and even now, many people do not consider it a chronic condition. It has not been viewed in this light historically, nor was it taught as such to students in medical schools,” she added.

The newly launched weight-loss drugs sibutramine and rimonabant were both found to have serious side effects in humans and were subsequently withdrawn from the market.Given that so many drugs are found to have serious side effects only a few years after their market launch, who would be willing to serve as a guinea pig for newly launched weight-loss medications?

Dr. Jastreboff acknowledged, “Past weight-loss drugs indeed had a checkered history; many caused side effects and even medical incidents, including cardiovascular damage, stroke, depression, and suicidal tendencies.”

“Moreover, their therapeutic effects are indeed difficult to control,” she added. “Not every weight-loss medication is suitable for every patient, and the field has not yet matured to the point where we can predict which drugs will be effective for specific patients.”Therefore, extensive clinical trials and iterative adjustments may be required to achieve optimal therapeutic efficacy and dosage.

Even with the best of intentions, it is hardly a wise choice for physicians, who are already overwhelmed by their hectic schedules, to open the Pandora’s box of obesity and overweight during a five-minute consultation.

“This field will see the emergence of experts with strong professional competence or those daring to lead this transformation, but it also urgently needs to rapidly evolve into an area applicable to primary care,” said Narachi.

Meanwhile, the vast majority of primary care physicians continue to encourage healthy eating and appropriate exercise when treating patients struggling with obesity.

Despite obstacles such as traditional mindsets, both Narachi and Jastreboff remain optimistic that this field is gradually undergoing a transformation.

“This field requires more comprehensive education and early medical training to support it, rather than simply telling doctors, ‘There’s a new drug you can try.’ What doctors believe in is scientific, evidence-based medicine,” Jastreboff pointed out.

Knowledge is one thing, while practice is another.

Jastreboff pointed out, “One of our biggest obstacles right now is insurance. If the medication a physician wants to prescribe is not covered by health insurance and the out-of-pocket cost is too high, why would they continue to prescribe it?”

"She remarked with resignation that for physicians, if they cannot freely utilize a certain medication to treat patients, it becomes difficult to establish trust in that drug."

Narachi candidly admitted that Orexigen Therapeutics was also a victim of this issue. Unlike healthcare systems committed to addressing obesity, insurance companies do not provide long-term coverage for individual patients in this area—at least, such is the current situation in the United States.

“Private commercial insurers are currently free-riding, unwilling to pay excessively for their customers,” Narachi said reproachfully.“Currently, only about 22% of weight-loss drug prescriptions have the potential to be covered by commercial insurance. If this proportion could be further increased, the cost burden shifted onto Medicare would be reduced.”

Jastreboff strongly agrees, stating, “I believe this is undoubtedly a short-sighted approach.”

In addition to commercial insurance, medical insurance is also not without blame.

“What shocked us is that Medicare Part D (the prescription drug plan) does not cover weight-loss medications either.” Narachi expressed surprise at this situation: “Keep in mind that this is government-controlled, legally protected Medicare, yet weight-loss drugs are not covered by any regulations.”

Health insurance can cover the costs of complications caused by obesity, yet it does not recognize obesity itself as a disease.

If primary care physicians maintain an ambivalent stance toward weight-loss medications, patients will naturally remain reserved as well. Many individuals do not trust the efficacy touted by pharmaceutical manufacturers, viewing these drugs as mild therapeutic agents rather than miracle cures for rapid weight loss.

Jastreboff cited an example: “If a patient weighs 200 pounds, he may wish to lose 50 pounds, which represents 25% of his body weight. He might wonder how much potential these weight-loss medications have in helping him shed pounds, estimating it to be around 5% to 10%.”

When addressing patients’ concerns, she always reiterates that weight loss varies—some individuals may lose more, while others less—and that she can only provide an average estimate. However, one point is crucial: even a 5% to 10% reduction in body weight can significantly benefit patients’ health. “If patients can reduce or completely discontinue medications for conditions such as hypertension or diabetes through the use of weight-loss drugs, this would be highly meaningful,” said Jastreboff.

For patients, accessing relevant information and education is particularly important.

Orexigen does not appear to have reaped the rewards from higher weight-loss drug sales yet, so it is embarking on further marketing efforts and a new round of public education.

Since terminating its prior licensing agreement with Takeda in March 2016, Orexigen has regained full distribution rights to the weight-loss drug Contrave. Under the leadership of Thomas Cannell, CEO and President of Global Commercial Products at Orexigen, the company is poised to make a strong comeback.

Cannell stated in an interview at the company’s headquarters: “Previously, people did not have a clear understanding of the market potential for weight-loss drugs in 2010. At that time, everyone believed it was a product capable of generating $1 billion in revenue, and everyone seemed to see enormous market demand. However, I believe they truly overestimated physicians’ enthusiasm for weight-loss medications.”

Orexigen has now restructured its promotional strategy to focus on physician and patient education. “Physicians should not simply tell patients, ‘You need to exert more willpower,’ or ‘You are not taking this seriously enough.’ Such remarks only accelerate patient dropout; physicians need to change their approach,” pointed out Cannell.

Jastreboff also endorses this view, stating, “Bias against obesity remains widespread, with many still attributing it solely to laziness and overeating. This perspective is decidedly one-sided, as obesity has its own underlying physiological causes.”

Orexigen’s new educational outreach strategy could help mitigate such biases. The strategy focuses on disseminating information about the pharmacological mechanisms underlying the synergistic combination of bupropion (Wellbutrin) and naltrexone in the company’s oral weight-loss formulation.

The drug primarily works by curbing patients’ urges to binge eat and prolonging the sensation of fullness. In addition, Orexigen has incorporated telemedicine technology to enhance patient engagement in treatment.

Jastreboff pointed out, “Medications like Contrave enable patients to adopt more reasonable eating habits and prevent weight regain. This is not an instant panacea, but it does help many patients who have struggled with weight loss for years to regain their confidence.”

After the FDA approved Contrave in 2014, Orexigen’s stock price once surged to $81; however, it has since lingered below $5 for an extended period. In a similar plight, Arena’s stock price fell from $11 to $1, while Vivus’s stock price also dropped from $28.54 in 2012 to around $1.

In contrast, other types of weight-loss drugs have gained widespread market traction, particularly those marketed through the channel of type 2 diabetes treatment, which appear to be more readily accepted by the market and better covered by insurance.

There are numerous weight-loss methods involving medical devices that are either already on the market or under development. These include the highly controversial Aspire Assist, a device that empties food from the user’s stomach after each meal.

Obalon Therapeutics, based in Carlsbad, California, received FDA approval in 2016 for its product, which enhances satiety through a balloon placed in the stomach. Allurion Technologies and ReShape Medical offer products with similar mechanisms of action.

Meanwhile, Dr. Jastreboff has chosen to travel independently across the United States, providing obesity-related training to other physicians while treating patients with obesity and overweight. Last year, she also co-authored the Comprehensive Guidelines for the Management of Obesity for the American Association of Clinical Endocrinologists.

“I want to say that the situation has significantly improved,” stated Dr. Jastreboff. “The FDA approved four new weight-loss medications in 2012 and 2014, so we can expect further improvements in the future. As a physician, my sole aim is to help patients; however, without adequate tools and therapeutic options, doctors are clearly powerless to intervene effectively.”

Source: MedCity News