Morgan Stanley analysts said they’re seeing a profound shift in the best way diabetes is managed, and doctors will intensify their give attention to weight management, accelerating the adoption of GLP-1 drugs. What’s more, analysts predict that over the subsequent 24 months, this weight-focused approach will begin to spread to other health complications, from heart failure to sleep apnea to kidney disease. “Over the past 12 months, we have now increased our Novo/Lilly GLP-1 diabetes revenue from $40 billion to $56 billion in 2030, outpacing obesity revenue growth,” the analysts wrote in a research note released last Friday, referring to their sales projections. Within the GLP-1 category, Novo Nordisk markets semaglutide under the brand name Ozempic for the treatment of type 2 diabetes and under the brand name Wegovy for the treatment of obesity. Meanwhile, Eli Lilly has been approved to market Mounjaro, or tirzepatide, as a treatment for type 2 diabetes. The drug is anticipated to be approved by the Food and Drug Administration for weight reduction by the top of this 12 months. Each GLP-1 drugs have attracted a whole lot of attention for his or her ability to lower blood sugar, curb food cravings, and help patients reduce weight. Each firms even have next-generation products in the pipeline that promise even greater effectiveness. While other biotech and pharmaceutical firms are developing their very own products, Novo and Lilly are expected to dominate this category in the approaching years. Morgan Stanley said GLP-1 drugs now account for nearly 30% of all recent diabetes prescriptions in the US. About 22% of all diabetes prescriptions are for this class of medication. Absorption was slower outside the US, which analysts say is a possibility for future growth; estimates global sales, excluding the USA, at over $70 billion by 2030. A Take a look at the Novo’s Select Study Morgan Stanley’s assessment comes ahead of the long-awaited results from the Novo’s Select Study, because of be released in the approaching weeks. The five-year study looks on the long-term cardiovascular advantages of obese patients taking Wegovy. The 17,500 patients in the study took Wegovy or a placebo. Top NVO YTD Novo Nordisk shares are up about 20% for the reason that starting of the 12 months. The positive results of the study may help support the concept treating obesity and fewer extreme weight gain with GLP-1 drugs will make patients healthier and ultimately save the healthcare system money. Heart disease and hypertension are two conditions commonly related to being obese, but there are also links to sleep apnea, chronic kidney disease, and other conditions. Investors hope that strengthening the link between weight reduction and higher health will help patients get insurance for these expensive drugs. This includes Medicare, which cannot reimburse patients for weight reduction drugs. Morgan Stanley said he was already surprised at how quickly insurers are adding coverage for drugs that may cost over $1,000 a month. “Obesity drug reimbursement has grown much faster than we expected, reaching 40 million lives in the USA, which exceeds the whole variety of individuals with diabetes,” they said. Analysts now predict that the GLP-1 drug market will reach $77 billion in 2030, up from an earlier forecast of $54 billion. “Now we have modified the capabilities of obesity medicine based on the faster uptake rate seen in the USA, anticipating that the positive data from the SELECT trial will result in positive changes in treatment guidelines by late 2024. We consider the knock-on effect will likely be to further unblock the bottleneck in the patient-physician relationship and broaden payer involvement,” said Morgan Stanley. The Wall Street investment bank also raised its price goal for Lilly shares to $560 from $551. The brand new goal implies a 20% increase from Monday’s close. Morgan Stanley’s price goal is well above the $471 average. Lilly shares are up about 26% from the beginning of the 12 months to Monday. LLY 6M Mountain Eli Lilly shares are up greater than 26% for the reason that starting of the 12 months. Lilly’s earnings rise Meanwhile, Wells Fargo on Monday predicted Lilly’s second-quarter revenue would surpass expectations due to stronger-than-expected sales growth from Mounjaro. “We’re seeing LLY’s turnover increase by around 3% through the second quarter as Mounjaro’s turnover may be very sensitive to improved return on costs. EPS forecast of $8.65-8.85/pp may not change significantly as LLY may determine to re-invest in upcoming launches in [Alzheimer’s disease] and immunology,” analyst Mohit Bansal wrote in a research note explaining the prediction. Lilly is scheduled to report second-quarter results on August 8. Lilly offers co-payment vouchers to assist patients start using Mounjaro, even when their health insurers aren’t yet fully reimbursing the drug. Withdrawal of co-payment cards 2022,” Bansal said. So she’s not apprehensive that Mounjaro’s total prescriptions have fallen since early June, as she expects this to be because of the departure of less profitable patients who used the co-pay card program. This implies revenue growth could have continued in June as more patients or their insurers paid the fuller price. —Michael Bloom of CNBC contributed to this report.