WeightWatchers CEO: ‘We have re-embraced our core expertise'

WeightWatchers CEO Sima Sistani joins Yahoo Finance Live to discuss company earnings, targeting lifestyle and behavior changes, drug treatments for weight loss amid the ongoing Ozempic controversy, and the outlook for WW International.

Video transcript

JULIE HYMAN: I've got to turn now to Weight Watchers. Those shares are settling down after skyrocketing 79% by the end of yesterday's trading session. This, after announcing plans to acquire Sequence, which is a digital health platform for clinical weight management. Here to discuss what this means for the future of weight loss innovation and more is Weight Watchers CEO Sima Sistani, along with Yahoo Finance's Anjalee Khemlani.

Sima, thank you so much for being here. Obviously, a huge gain in the stock that we saw yesterday. Weight Watchers has sort of been trying to figure out its identity now for a number of years. What does this mean for the future of the platform as a whole? How should people be thinking about Weight Watchers at this point?

SIMA SISTANI: Well, thanks for having me and Happy International Women's Day too to both of you as well. Look, we're first of all managing to the long-term health of the company, not the stock price. Although, obviously, the market validation was nice to see yesterday.

I joined as CEO last year and I really believe that this is a product, a science-backed solution to weight loss management full stop. And no matter what that pathway is, whether it's through lifestyle and behavior change, which is what we have done for 60 years, or whether it's introducing new pathways through clinical interventions as we announced to the market. The other thing I'd like to note as we talk about finding our identity is I joined last year, but I actually joined Watchers in 2014.

This is a program that worked for me, helped me lose my weight after being postpartum, struggling with a thyroid condition. It is a program that is proven, that works, that is science-backed. And that's why I think it's really important that we enter the space and we continue to advance along with the science.

ANJALEE KHEMLANI: Sima, Anjalee here. I hear you and I know that you've been questioned a lot about this, especially because Weight Watchers, their reputation has been over the years not a clinical, not a prescription sort of program. And so looking at it now, do you see maybe a split in who your members will be and who qualifies, let's say, for using that clinical intervention versus those who won't?

SIMA SISTANI: So what I would say underpins all of our solutions is evidence-based programs. So our Behavior Change and Lifestyle Program is backed by 35 clinical trials, over 140 peer-reviewed studies. And what we've seen now is this innovation that is understanding, that is recognizing the biological components that underpin the complex condition around living with overweight and obesity. And to that end, these medications, they're not for everyone.

You know, I think that there's been a lot of misinformation and misuse, treating them like something where you're going to lose 10 to 20 pounds for your reunion. That's not the appropriate use for these medications. They are meant to be chronic weight management for complex disease. And I think that to your point, right now the FDA recommends that if you have a BMI of over 30 or a BMI over 27, alongside another comorbidity, that these pathways may be right for you. And if medically appropriate, we want to be able to provide the full stack solution for our members.

But the important thing to note here is what these medications do is help you with your adherence to a lifestyle and behavior therapy. So the Weight Watchers you know and love is not going anywhere. It's an and, not an or.

JULIE HYMAN: And just to put some of those numbers in perspective of what you're talking about when you talk about BMI, I believe the CDC says that BMI for women-- a healthy weight BMI should be 18.5 to 24.9. Sima, reading between the lines here, there's been this wave of influencers and celebrities who have been using these drugs. Many of them do not have the BMI that you were describing.

It sounds like you think they're doing people a disservice maybe, by publicizing use of these kinds of drugs?

SIMA SISTANI: Well, I think that this is why we need to lead from a point of responsibility and science to really help people understand and educate them about the science. And I think that's where we have a lot of value to add, is to take the consumer approach, the evidence-based consumer approach so that they understand what their options are. And to your point, I think part of that is recognizing that these aren't quote, unquote "weight loss drugs".

These are chronic weight management prescription that can help you with the conditions of living with overweight and obesity.

ANJALEE KHEMLANI: I think what you're saying is we're starting to recognize what has been happening in the medical space, which is obesity and being overweight. That's something that is starting to be looked at more from a medical lens than just a lifestyle lens. And we've seen that with food insecurity, food access, healthy food access, and the like in the health care space. So it's interesting that you're looking at that now.

Just one more question on that-- you know, specifically on the prescriptions. How are you integrating that when it comes to the cost of it. Who's bearing that cost if you do end up prescribing? It is it part of that membership fee or is it an additional cost for whoever gets prescribed?

SIMA SISTANI: Yes, and I do want to recognize what you said around obesity trends that have become prevalent in our society. So willpower alone in a lot of cases is complex. And because of the genetic and the biological, environmental, socioeconomic obesogens, that's where these medications can help with adherence.

And to your point, Sequence, the platform that we acquired, it is providing access to a provider. It is a simple UX-- imagine being in a chat with a whole care team-- clinician, nutrition expert, fitness expert who can address a lot of the complications that come up with being on chronic medications. And this is not like an ED script that you can just get and walk away. It requires a lot of care management. You have to titrate your dosage.

And so what we're offering is the platform to enable to do that. And alongside that, putting the insurance process on tech rails such that it becomes easier to access these medications if you medically qualify and have them covered. So the Sequence subscription is the care management. And ultimately, we're in the subscription business, not the prescription business.

That is still something that manage the insurance side of things will ultimately be a cost that the consumer takes on. We try to help with the insurance side of things. Because again, if you're medically qualified, in most cases insurance, depending on the employer, will cover.

ANJALEE KHEMLANI: So it sounds like there's at least some guardrails to make sure that you're not overprescribing and that you don't contribute to a shortage of the drug.

SIMA SISTANI: Absolutely. We don't want to get in the way of the patient/provider experience. That is between them.

ANJALEE KHEMLANI: So, let's talk about what is being branded or being perceived as a pivot. Prior to coming on, Weight Watchers was pivoting already away from just a diet and branding perspective into wellness. And it seems like a lot of that effort into wellness has either been scaled back or is shifting back into Weight Watchers traditional or legacy, if you will. So can you kind of clarify, like, what is this new look forward? What's the outlook here?

SIMA SISTANI: Yes. So yes, I would say that when I joined last year I thought it was important for us to embrace our heritage around being Weight Watchers, and being prideful in that legacy, and take on our responsibility of entering in to the conversation around weight loss and what it can do for people's health. I mean, we are underpinning our food science and our lifestyle behavior change therapies is community ultimately. And that's why I was so excited to come here coming from a background of growth tech and social, is this is truly the OG social network.

This is how people connect around a vulnerable experience. Weight loss is very emotional and requires an emotional solution. And so I think, to be clear, it's not a pivot. We have re-embraced our core expertise of being the leading provider of weight loss solutions. And the ecosystem has expanded. And so, too, will we.

I mean, the example I keep giving is Amazon was a bookseller. They're still a bookseller, but they just do a lot more. I think we are a trusted brand. We have a lot of value to bring to this space underpinned by our nutrition science, our behavior change program, and most importantly our community.

JULIE HYMAN: Sima, thank you so much for being here. Sima Sistani is Weight Watchers CEO, as well as our Anjalee Khemlani for joining. Appreciate it to both of you.