Lilly's tirzepatide slides into FDA fast lane for obesity, turning up heat on Novo Nordisk's Wegovy

Eli Lilly is gaining on rival Novo Nordisk as its dual GIP/GLP-1 med tirzepatide—fresh off an approval pit stop in diabetes—slides into the FDA fast lane.

Thursday, Lilly said the FDA flagged its drug for fast-track designation in adults with obesity plus those who are overweight with weight-related health problems.

The decision puts pressure on Novo Nordisk and its own weight loss arriviste Wegovy, which largely has the obesity market to itself for now.

Novo’s blockbuster-to-be, which forms part of the Danish drugmaker’s semaglutide franchise, won a landmark obesity approval last summer. Wegovy has stumbled on supply issues tied to unexpected demand and early contract manufacturing problems, though Novo says the problems are mostly in the rearview. Wegovy pulled down 1.18 billion Danish kroner ($161 million) in 2022’s second quarter.

Based on talks with the FDA, meanwhile, Lilly says it aims to start a rolling submission of tirzepatide’s obesity application this year. The final submission will draw primarily on data from a pair of phase 3 trials. Those are SURMOUNT-1, which is already complete, and SURMOUNT-2, which is due to wrap up by the end of April 2023, Lilly said in a release.

Under the rolling review, Lilly will be able to submit parts of its application to the FDA as they finish out rather than waiting until all sections are completed. The company added that it hopes to complete its submission “shortly after” SURMOUNT-2 data surface next year.

While Lilly waits on a readout from SURMOUNT-2, the company’s sitting pretty on positive results from tirzepatide’s first pivotal weight loss study. Back in June, tirzepatide aced both its primary endpoints in SURMOUNT-1, helping patients chart a superior mean percent change in body weight from baseline as well as helping a greater percentage of patients hit at least 5% body weight reduction versus placebo.

While tirzepatide in obesity could eventually launch with an identity all its own, the molecule has already claimed one FDA approval in Type 2 diabetes. After the drug’s nod in May, Lilly has said Mounjaro’s launch is going well and is “tracking at the highest end” of its demand expectations. That’s according to a recent note from analysts at Morgan Stanley, who last month met with Lilly Chief Financial Officer Anat Ashkenazi.

Lilly seems to have learned from Novo’s external manufacturing hiccup, too. To keep Mounjaro levels steady, the company plans to double incretin production capacity by the end of 2023, the analysts said last month.

While a potential obesity approval is still a ways off, industry watchers and Lilly investors are no doubt watching tirzepatide's every advance.

In another note to clients, a team of analysts at UBS recently opined that tirzepatide could become “the biggest drug ever,” with the potential to bring home peak sales of $25 billion. So far, AbbVie’s immunology stalwart Humira is the most lucrative drug in biopharma history.

That's a tall order, to be sure, but it doesn’t seem impossible when stacked against a separate projection of the near-term obesity opportunity for Lilly and Novo.

By the end of the decade, the global weight loss market could be worth more than $50 billion, analysts at Morgan Stanley Research wrote to clients in July. The team speculated obesity could become the “new hypertension,” with the potential to grow into “the next blockbuster pharma category.”