As they do each summer time, publicly traded firms posted their second-quarter outcomes whereas Americans had been baring their our bodies on the seaside. But this 12 months, the timing was apt. On a number of earnings calls in August, chief executives reassured buyers that the Ozempic revolution had not left them within the mud, and that they may someway share within the blazing success of recent diabetes and weight reduction medicine.
“It puts us in a good position to be a solution for those who are on the drugs,” stated Dan R. Chard, the chief govt of Medifast, which makes food regimen merchandise like shakes and protein bars, including: “They’re looking for guidance.” He instructed analysts this even whereas explaining that new-generation medicine had helped pummel earnings, down 34.7 p.c 12 months on 12 months.
“We will continue to study this,” Michael Johnson, the chief govt of the dietary complement maker Herbalife, instructed buyers. “And when we see an opportunity to capitalize on it, we will.”
In principle, that chance — each for making income and for shedding fortunes — may very well be huge not just for the businesses behind these medicine but additionally for some in fully totally different industries.
Known as GLP-1 medicine, the drugs are already driving large income. Novo Nordisk makes each Ozempic, which has been permitted just for Type 2 diabetes, and its shut relative Wegovy, which has been permitted for weight reduction. They mimic a glucagon-like peptide that regulates urge for food within the mind, leaving folks feeling sated for hours. Together, they helped ship Novo’s earnings rocketing up 32 p.c within the first half of this 12 months, and Novo’s market worth is now bigger than all the Danish economic system. Eli Lilly’s gross sales surged 28 p.c within the second quarter, thanks to a different diabetes drug, Mounjaro, which the Food and Drug Administration might approve for weight reduction this 12 months.
And the total potential isn’t even clear but. The marketplace for weight reduction medicine is large: There are roughly 750 million overweight folks worldwide, together with about 42 p.c of adults within the United States, the place obesity-related sicknesses incur billions of {dollars} in well being care prices annually. But Novo says GLP-1 medicine might finally produce other makes use of, like serving to stop heart problems amongst overweight adults. There are indicators they may deal with dependancy and even Alzheimer’s, too.
“The market potential is very, very significant,” Novo’s chief monetary officer, Karsten Knudsen, instructed me once I visited the corporate in June. “We’re operating in kind of unusual territory.”
Diet firms are bracing for disruption. For many years, weight reduction firms have relied on branded, prepackaged meals and way of life applications. Some, like WeightWatchers and Noom, have raced to promote GLP-1 medicine themselves, whereas others nonetheless hope their merchandise can survive the Ozempic period. Jenny Craig shut its weight reduction facilities in May after 40 years. And Simply Good Foods, which distributes Atkins food regimen merchandise like frozen meals and cookies, will market Atkins as “a perfect complement to people thinking about using the drugs,” the corporate’s chief govt on the time, Joe Scalzo, instructed analysts in June.
The ripple results are widening. Retailers like Walmart, Kroger and Rite Aid say GLP-1 prescriptions are bringing extra folks into shops, the place they make different purchases. Walmart’s chief govt, Doug McMillon, instructed analysts in August that its executives “expect consumables, and health and wellness, primarily due to the popularity of some GLP-1 drugs, to grow as a percent of total.”
Medtronic’s chief govt, Geoff Martha, stated the corporate had seen a “modest” dip in bariatric surgical procedure, presumably as folks opted for weight reduction medicine as an alternative. And some analysts consider the medicine might disrupt the American food regimen.
“If you’re eating fast food every day, you’ll probably continue to eat fast food every day,” James van Geelen of Citrinas Capital Management stated on Bloomberg’s “Odd Lots” podcast. “You will just eat a lot less of it.”
Still, there’s room for different approaches to preventing weight problems. “These drugs are game changers, but with an asterisk,” stated David Ludwig, an weight problems specialist and pediatrics professor at Harvard Medical School. (The medicine include an extended checklist of uncomfortable side effects.) “Even if you can reduce weight across the population with drugs, it’s not going to eliminate the risks of a poor diet.”
Flush with money, Novo agrees. “We need to be looking at what’s the next thing,” its govt vp for industrial technique Camilla Sylvest, instructed me. In June, the corporate launched an weight problems prevention unit close to Copenhagen, to analysis learn how to cease the illness earlier than folks must take medicine to shed pounds. — Vivienne Walt
IN CASE YOU MISSED IT
The U.S. labor market begins to seem like its outdated self. Employers added 187,000 jobs in August, the Labor Department reported Friday, and unemployment rose to three.8 p.c because the economic system continued to lose momentum constructed up after pandemic lockdowns.
Commerce Secretary Gina Raimondo visits China. She had the tough job of selling commerce between the 2 superpowers whereas holding agency on know-how export limits imposed within the title of American nationwide safety. The two nations agreed to create new dialogues, together with a working group for industrial points.
The White House names the primary medicine set for Medicare value negotiations. The long-awaited checklist of 10 medicines shall be topic to a landmark new program meant to cut back prices for Medicare. Drugmakers have pushed again towards the plan, together with in court docket, and Republicans have criticized the initiative as authorities overreach.
UBS experiences a $29 billion quarterly revenue, with an asterisk. The large acquire — the largest in banking historical past — stems from the financial institution’s acquisition of its rival Credit Suisse this spring for about $3.2 billion, a steep low cost that’s skewing UBS’s outcomes. But it belies the challenges that UBS faces because it strikes to finish the biggest takeover of a financial institution for the reason that 2008 monetary disaster.
The final lady boss
When Emily Weiss stepped down final 12 months because the chief govt of Glossier, the skincare and wonder model she based in 2014, some known as it the tip of the “girlboss.” That archetype — of media-savvy feminine founders with venture-darling, millennial-focused start-ups — had been propelled by “#Girlboss,” the Nasty Girl founder Sophia Amoruso’s 2014 memoir.
Glossier, with its direct-to-consumer mannequin and voice-y web site, modified the way in which girls purchase make-up, finally passing a $1 billion valuation. But the model stumbled because it struggled to maneuver into brick-and-mortar retail; confronted criticism from retail staff who alleged a poisonous, racist working surroundings; and shelved tasks like a make-up line that departed from its dewy, barely-there look.
DealBook spoke to Marisa Meltzer, writer of the upcoming guide “Glossy: Ambition, Beauty, and the Inside Story of Emily Weiss’s Glossier,” about what classes we’d glean from Weiss and the #Girlboss motion.
This interview has been edited and condensed for readability.
Can you contextualize the #Girlboss motion?
It was fairly offensive and diminutive. No one aside from Sophia was calling themselves out as a girlboss. But it was additionally one thing that benefited them as a result of it attracted curiosity. It was a manner for them to get press about their companies that wasn’t the everyday issues that feminine founders and C.E.O.s typically needed to do, like a vogue unfold.
There was a giant debate on the time over whether or not the press would have coated the scandals at firms like Outdoor Voices, Man Repeller and Glossier in a different way if they’d males on the helm. What do you assume?
I feel there was a little bit of a thirst for blood. These girls had been propped up in a manner that was sort of annoying — I’m positive it was annoying to them, too.
Some of these firms had actual issues, like being sued over firing pregnant staff. And different firms had, like Glossier, an accusation of getting a office, largely for his or her retail staff, that wasn’t excellent. That’s totally different than legal conduct.
The actuality is these firms weren’t the identical. The girls at their helms weren’t all the identical. And they weren’t making the identical errors. And in addition they didn’t have the identical stage of success.
What occurs to Glossier now?
Glossier appears to have taken the time since Emily stepped all the way down to re-evaluate. They determined to actually belatedly go into retail. They launched in Sephora final February. The bigger job that they’re making an attempt to do is make the corporate in higher form for an exit.
Who would possibly purchase them?
An organization like Estée Lauder that owns loads of boutique manufacturers would make sense. There’s additionally Kering, the style home that owns Gucci, which has been making some seen performs to get extra into the sweetness market.
On our radar: The story of Carlos Ghosn
In 2019, whereas going through legal costs of monetary wrongdoing, the previous Nissan govt Carlos Ghosn skipped bail and fled Japan in an elaborate plot that concerned a non-public jet and a trunk with respiration holes drilled into it. At the time, DealBook known as it “a movie-level caper,” and two tasks — one by the BBC and one other by Netflix — had been fast to painting it on video. But neither did so in addition to a four-part Apple TV+ documentary collection that was launched final week.
“Wanted: The Curious Case of Carlos Ghosn” is produced by The Wall Street Journal and is predicated on a guide by two of its reporters. With Ghosn’s participation, it tells the thriller-like drama of one of the vital memorable business tales this decade whereas exploring its nuances.
“The series explicitly poses the question of Carlos Ghosn: victim or villain?” The Guardian’s Adrian Horton writes. “With blurred lines, overlapping narratives and convoluted paper trails, it doesn’t land on a simple answer.”
Thanks for studying! We’ll see you on Tuesday.
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Source: www.nytimes.com