By Elsa Ohlen

Weight-loss and diabetes drugs reduced the risk of developing Alzheimer's, an independent study published Monday showed.

Pharma giants Novo Nordisk and Eli Lilly look to be the main benefactors of GLP-1 medications turning into a "catch-all pill," mitigating a raft of health conditions beyond obesity and diabetes amid increased competition in the weight-loss space.

Glucagon-like peptide 1, or GLP-1, is a gut hormone that helps control blood sugar levels and appetite. Researchers have now mapped the effectiveness and risks of GLP-1 agonists in the largest ever study of its health impact beyond diabetes and weight-loss.

The study, published in Nature Medicine, showed that patients treated with GLP-1 medications were 12% less likely to develop Alzheimer's. An Oxford University study in July last year also showed Novo's GLP-1 medicine reduced the risk for dementia when compared with another Type 2 diabetes medicine, Merck's Januvia.

The most known GLP-1 drugs, and the only ones currently approved for weight management, are Novo's Semaglutide and Lilly's Tirzepatide.

Semaglutide, which is sold as Ozempic for diabetes and Wegovy for weight-loss has already been approved for treating cardiovascular conditions and kidney disease while Tirzepatide, sold under Mounjaro for diabetes and Zepbound for weight-loss, is approved for treating sleep apnea.

The new study was also associated with reduced risk for substance abuse, psychotic disorders, cardiometabolic disorders, infectious illnesses and several respiratory conditions. On the flip side, the researchers found an increased risk of conditions including gastrointestinal disorders, hypotension and kidney and pancreatic disorders. The study looked at a large number of U.S. veterans with diabetes over six years, therefore data is likely to be skewed to senior white males.

Novo Nordisk and Eli Lilly didn't immediately respond to a request to comment on the study's findings.

More and more proven health benefits should make GLP-1 drugs more attractive not just in expanding the market but for governments, too, according to Chris Smith, portfolio manager at Artisan Partners. Many insurers today cover heart and kidney diseases and respiratory conditions, but not weight-loss medications.

Expanding labels beyond diabetes and weight-loss would likely benefit the drugmakers already in the lead as any rival drugs will probably also have to run their own lengthy clinical trials to prove effectiveness on other health-related conditions. "The more that they [Novo and Lilly] can build that..., the more their moat becomes bigger," Smith told Barron's.

For investors, that means Novo and Lilly could continue to rack up eye-popping profits for many years to come, minimizing pressures from emerging competition.

That said, GLP-1s aren't cheap, especially not in the U.S. Including them in insurance coverage would likely significantly expand access. However, sales also depend on pricing and Ozempic/Wegovy were included in the 2027 price negotiation list announced earlier this month, meaning Medicare may soon start paying less for the drugs.

Novo's Danish-listed shares were up 2.8% while its American depositary receipt, or ADRs, fell 0.3% in premarket trading. Lilly shares were marginally up.

Both stocks have fallen double digits over the past three months as investors have been disappointed with sales of their blockbuster drugs. Novo shares have done even worse than Lilly as its next-generation weight-loss drug CagriSema failed to meet its longstanding target of 25% weight reduction over 68 weeks.

Write to Elsa Ohlen at elsa.ohlen@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

January 21, 2025 08:19 ET (13:19 GMT)

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