Today, $Eli Lilly and Co (LLY.US)$ China officially announced the launch of Mu Fengda (Tirzepatide Injection) in China, covering two indications, as the domestic GLP-1 drug market officially welcomes a strong "player."

The market expectations for Tirzepatide are very high, and there is widespread concern about pricing and whether it will be included in medical insurance. Regarding plans to enter medical insurance, Eli Lilly and Co did not respond directly to reporters, simply stating, "Please refer to the pricing by major pharmaceutical Institutions for specific prices."

"The competition in the domestic GLP-1 market will become intense by 2025." Industry experts told reporters that GLP-1 drugs are one of the few areas in Biomedical that can create blockbuster products, with Jiangsu Hengrui Pharmaceuticals, $INNOVENT BIO (01801.HK)$ and other domestic companies will engage in a race against time to enter this blue ocean as soon as possible.

Elon Musk stated, "better than Semaglutide."

Today, Eli Lilly and Co publicly announced that Mu Feng Da (Tirzepatide injection) is officially launched in China, covering two indications, namely type 2 diabetes and weight loss, with four specifications available: 2.5 mg:0.5ml, 5 mg:0.5ml, 7.5 mg:0.5ml, 10 mg:0.5ml.

"Currently, Mu Feng Da (Tirzepatide injection) is a self-funded medication. Please refer to the pricing of major medical institutions for specific prices," Eli Lilly and Co informed Financial Association reporters.

The official launch of Tirzepatide in China means that last year's best-selling Semaglutide will face a strong competitor.$Novo-Nordisk A/S (NVO.US)$Previously, Eli Lilly and Co announced the topline results of a head-to-head phase 3b clinical study showing that in overweight non-diabetic adults with obesity or at least one weight-related comorbidity, after 72 weeks of treatment, the weight loss effect of Tirzepatide (an average weight loss of 20.2%) significantly outperformed Semaglutide (an average weight loss of 13.7%), with the relative weight reduction achieved in the Tirzepatide group being 1.47 times that of the Semaglutide group.

The claim that "the effectiveness is better than semaglutide" has been confirmed by Elon Musk, one of the "first fans" of semaglutide. On December 26 of last year, Musk revealed on social media that he was using Eli Lilly and Co's Mounjaro (the U.S. version of tirzepatide) for weight loss. Musk also admitted that high doses of semaglutide made him experience embarrassing situations like farting and burping, similar to Barney from "The Simpsons", while tirzepatide "seems to have fewer side effects and is more effective."

In reality, although tirzepatide was launched later than semaglutide, it has already captured a significant share of the GLP-1 drug market in the Global market.

It is reported that in the first three quarters of 2024, Novo-Nordisk's total revenue was 204.72 billion Danish kroner (approximately 29.85 billion USD, based on 1 Danish kroner = 0.14581 USD), a year-on-year increase of 23%; net income was 72.758 billion Danish kroner (10.609 billion USD), a year-on-year increase of 18%. Among these, the total sales of semaglutide reached 141.213 billion Danish kroner (20.59 billion USD), accounting for nearly 70% of total revenue.

In comparison, the sales of tirzepatide in the first three quarters of 2024 reached 11.028 billion USD, with the sales of Mounjaro for diabetes treatment amounting to 8.01 billion USD, a year-on-year increase of 171%; and the sales of Zepbound for obesity treatment were 3.018 billion USD, currently in a phase of rapid growth.

The market is paying attention to whether it will be included in the medical insurance.

"Semaglutide has already proven that weight loss drugs are one of the few directions in the current Biomedical market that can create 'blockbuster products'. Domestic innovative drug and biomedical companies will definitely try to accelerate the research and approval process for related products," said Wang Heng, general manager of Beijing Baisili Marketing Planning Co., Ltd. to a reporter from Caixin.

The market has very high expectations for tirzepatide. Previously, media reported that on December 23, tirzepatide opened for reservations on a network platform, and individuals close to this network platform revealed that tirzepatide sold out in 3 seconds the night it was launched, with reservations increasing more than threefold day-on-day. Customer service from merchants indicated that the demand for tirzepatide is currently very high and they will continue to keep stocks to meet the demand.

A screenshot of tirzepatide from a certain online platform by Caixin reporter.

It was found on a certain online shopping platform that the discounted price for Tersizumab Injection 0.5ml: 2.5mg * 4 vials/box is 2249 yuan, which is approximately 562.25 yuan per vial. Similarly, on this platform, the discounted price for Semaglutide Injection 3ml (1.34mg/ml)/vial/box is 631 yuan.

As a drug indicated for both diabetes and weight loss, will Terzepatide participate in the national medical insurance negotiations in 2025 and be included in the national medical insurance catalog? This is a key focus for many industry insiders.

Eli Lilly and Co has not directly responded to this question, but stated to the Financial Associated Press that, "Eli Lilly and Co is committed to improving drug accessibility, allowing patients to be prescribed Terzepatide according to national regulations and clinical guidelines. We firmly believe in the cost-effectiveness and added value of Terzepatide, and will continue to explore solutions to enhance patient accessibility."

Wang Heng analyzed that since 2025 will be the first year of Terzepatide's launch in China, there may not be a strong willingness to enter medical insurance. Previously, the National Healthcare Security Administration had clearly stated that weight loss drugs are not considered for inclusion in insurance, while Semaglutide is the one entering insurance for diabetes indications. However, this may not be applicable to Eli Lilly and Co, as Terzepatide encompasses two indications for one product.

If Terzepatide enters medical insurance, will it lead to a decrease in the price paid out of pocket by weight loss patients? This is something Eli Lilly and Co needs to consider carefully," Wang Heng further pointed out.

Regarding production capacity, Eli Lilly and Co told the Financial Associated Press, "Since 2020, the company has committed to investing over 20 billion dollars to enhance production capacity. Despite this, the supply of drugs remains limited due to unprecedented demand. Our new factories will take some time to reach full operation, but they have already helped us increase supply. We currently have seven factories increasing capacity or under construction."

In 2025, the GLP-1 track will see fierce competition.

Bloomberg Industry Research pharmaceutical analysts Michael Shah and Yang Qiuchen previously told the Financial Associated Press that the rising obesity rate in China means that by 2030, as many as 0.14 billion adults may be affected, so it's not surprising that a large number of international and domestic pharmaceutical companies are turning their attention to this market.

Public information shows that over 90 global pharmaceutical companies are developing weight loss drugs, with at least 120 drugs currently in clinical development, of which about 30% are Chinese pharmaceutical companies, accounting for approximately 25% of the research pipeline assets (in Phase I or later).

There are many companies in China focusing on GLP-1. According to the reporter from the Financial Association, Jiangsu Hengrui Pharmaceuticals' HRS9531 has entered the Phase III clinical trial for obesity treatment; INNOVENT BIO's Ma Shugduo peptide has officially submitted two indications (diabetes and weight loss) for market approval; the I-Na-Gratide from Xinweida is conducting Phase III clinical trials for obesity treatment in China, and listed companies such as Livzon Pharmaceutical Group Inc., Huadong Medicine, and Gan & Lee Pharmaceuticals (603087.SH) are all racing in the GLP-1 track.

Michael Shah and Yang Qiuchen, analysts in the pharmaceutical sector from Bloomberg Industry Research, predicted to reporters from China Finance that "INNOVENT BIO's Masitide, Jiangsu Hengrui Pharmaceuticals' HRS9531, and Gan & Lee Pharmaceuticals' GZR18 are the most attractive assets in China's injectable GLP-1 research pipeline, and current data indicates that their competitiveness is at least comparable to Zepbound (Tirzepatide). Masitide is expected to obtain approval in China by 2025, but HRS9531 and GZR18 are unlikely to be marketed before 2028."

Wang Heng believes that by 2025, it is foreseeable that INNOVENT BIO's Masitide will enter this blue ocean market. Since both weight loss and diabetes treatment require long-term use, the "substitution" effect of Semaglutide and other GLP-1 drugs is very evident, which will intensify market competition for these drugs and may lead to price changes for related medications. "Eli Lilly may adjust its market strategy, pricing, and whether to apply for entry into medical insurance flexibly based on the approval status of related drugs in the domestic market."

Editor/rice