Eli Lilly’s Obesity Pill Breakthrough Shakes Up $150 Billion Weight-Loss Race

A Fierce Battle for Weight-Loss Supremacy

The weight-loss drug market has become a battleground, ignited by the runaway success of Novo Nordisk’s (NYSE:NVO) Ozempic and Wegovy. These injectable GLP-1 receptor agonists have transformed obesity and diabetes treatment, but Eli Lilly (NYSE:LLY) has stolen the spotlight with its own injectable, Zepbound, which outperformed Wegovy in a head-to-head trial, achieving an average 20.2% body weight loss compared to Wegovy’s 13.7% over 72 weeks. 

This edge has propelled Lilly to the forefront, with Zepbound and its diabetes counterpart, Mounjaro, generating $5.69 billion in sales in the first half of 2025. Yet, the industry’s ultimate prize remains an oral weight-loss drug — a pill that eliminates the need for injections, while also promising greater convenience and scalability. 

However, Eli Lilly made a stunning announcement yesterday that may have just turned the weight-loss-in-pill market on its head.

The Race for the Oral Holy Grail

Eli Lilly, Novo Nordisk, and Viking Therapeutics (NASDAQ:VKTX) are among the key players racing to develop an oral GLP-1 drug. Unlike injectables, which require complex manufacturing and cold storage, pills like Lilly’s orforglipron and Novo’s oral semaglutide offer simpler production and broader accessibility. Viking Therapeutics is also advancing its oral candidate, VK2735, currently in Phase II trials. 

Earlier this month, though, Lilly faced a setback when orforglipron’s Phase 3 ATTAIN-1 trial results disappointed investors, showing a 12.4% average weight loss compared to Novo’s oral semaglutide’s 13.6%. The news triggered a 19% plunge in Lilly’s stock, raising doubts about its lead in the oral market. Competitors seemed poised to overtake it, with Novo’s oral semaglutide already under Food & Drug Administration review for obesity.

A Game-Changing Turnaround

Yesterday’s announcement, though, shocked the market with new Phase 3 ATTAIN-2 trial results, with Lilly announcing that orforglipron “met the primary and all key secondary endpoints” in patients with both obesity and type 2 diabetes. 

The pill reportedly helped patients lose an average of 10.5% of their body weight (22.9 pounds) over 72 weeks, compared to 2.2% for those taking a placebo, while also significantly lowering blood sugar levels. Over half of patients on the highest dose lost at least 10% of their weight, with 28.4% shedding 15% or more. The drug’s safety profile also mirrored that of injectable GLP-1s, with mild to moderate gastrointestinal side effects like nausea and diarrhea. 

Lilly’s stock surged 5.9% on the news and is climbing 1.2% in premarket trading today, indicating renewed investor confidence.

A Formidable Leader in Weight-Loss and Diabetes

Lilly’s comprehensive portfolio — Mounjaro, Zepbound, and now orforglipron — positions it as a powerhouse in the weight-loss and diabetes markets. Mounjaro, approved for diabetes, and Zepbound, for obesity, dominate with $5.2 billion and $3.4 billion in Q2 sales, respectively. Orforglipron’s lack of dietary restrictions and ease of manufacturing give it a unique edge over Novo’s oral semaglutide, which requires fasting. 

A William Blair analyst noted that orforglipron’s success in the high-risk obese diabetic population — roughly 25% of overweight individuals — demonstrates its competitive advantage, especially since these patients often manage comorbidities with oral medications. This seamless integration into daily routines could drive widespread adoption, potentially capturing a significant share of the $150 billion GLP-1 market projected by the early 2030s.

Key Takeaways

For Lilly investors, the ATTAIN-2 results are a game-changer, restoring orforglipron’s promise as a market leader. The pill’s efficacy in a challenging patient group and its manufacturing advantages signal blockbuster potential, with analysts forecasting peak sales up to $40 billion by 2033. 

Lilly’s plan to submit for FDA approval by the end of this year positions the pharmaceutical giant to compete head-on with Novo’s oral offering. Despite recent volatility, Lilly’s stock, with a market cap of $696 billion, remains a strong contender. 

For investors with a long-term horizon, Lilly’s diversified portfolio and innovation make it a compelling buy, even if there are short-term risks like competition and pricing uncertainties. The stock’s recent rally suggests the market sees Lilly reclaiming its edge, making LLY stock a buy.

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