(*4*)The anti-obesity drug market is anticipated to stay in focus this yr after a bumper 2023 for weight reduction drugmakers Novo Nordisk and Eli Lilly , in accordance with Berenberg. The Germany-headquartered investment bank expects a mix of latest clinical data, and the expiry of Novo ‘s patent for the lively ingredient in first-generation GLP-1 drugs, to unleash latest opportunities for several generic drug manufacturers in Europe. GLP-1 drugs encourage the production of hormones that cause weight reduction through reduced appetite. Patent protection for Wegovy — Novo Nordisk ‘s blockbuster weight reduction drug, which incorporates the second generation GLP-1 lively ingredient and is at the very least twice as effective as a placebo — is anticipated to run out by the last decade’s end. The soaring demand for this drug increased Novo’s shares by about 50% in 2023. Nevertheless, Berenberg’s analysts imagine the larger, underappreciated, near-term opportunity lies with firms preparing to launch generic versions of the first-generation GLP-1 drugs. For instance, patents on Novo Nordisk’s Victoza expired in 2023, opening the door for firms like Teva and Sandoz to launch generics in the primary half of 2024, in accordance with the bank. The table below shows Berenberg’s 4 buy-rated stocks with their upside potential. Sandoz is Berenberg’s top pick for 2024. The analysts said: “Victoza could provide a lift to generic earnings growth within the short term while confirming Sandoz GLP-1 capabilities and long run pipeline.” They expect sales to ramp up this yr and see room for Sandoz to lift its profit margin guidance above 18-19%. Berenberg also highlighted Gerresheimer as a option to play the GLP-1 trend. It expects the corporate’s GLP-1 revenue to double in 2024 to over 50 million euros ($54 million). The analysts expect shares to rise by 44.4% over the following 12 months. Under-the-radar picks Sartorius and SKAN Group, Berenberg’s “under-the-radar” pick, are also expected to profit from manufacturing generic GLP-1 drugs. The investment bank sees Sartorius benefiting from the growing commercialization of GLP-1 drugs and forecasts shares to rise by 27% over the following 12 months. As for SKAN, which also trades in the US, the bank’s analysts said, “We proceed to think SKAN is a transparent yet under-the-radar beneficiary of GLP-1-related spending, particularly following recent capex announcements from its customers which concentrate on fill-finish lines.”