June 23, 2023

How GLP-1 agonist drugs could change healthcare demand

With more than two in five American adults considered obese, the potential for GLP-1 agonist drugs like Wegovy, Ozempic, and Mounjaro to revolutionize obesity treatment seems limitless. In the graphic below, we looked to quantify how much these drugs could potentially change healthcare expenditures and demand. Using Wegovy’s list price of $1.3K per month, a GLP-1 drug prescription for every obese American adult would cost as much as $1.3T annually—30 percent of total US healthcare expenditures. Analyst projections of GLP-1 drugs forecast revenue to grow by over 5x by 2028, from $3 billion to $16 billion annually. While it’s unlikely that every overweight American will access the drugs, growing use of GLP-1 agonists will likely drive down obesity rates, and downstream care demand could shift in expected and unpredictable ways. Demand for weight-related surgeries, including joint replacements and bariatric surgery, will likely drop. Incidence of chronic diseases like diabetes and cardiovascular disease could also drop, potentially raising life expectancy. But even if we’re living longer thanks to the new drugs, we’ll still die of something eventually: expect a secondary rise in cancers and Alzheimer’s, as well as surging demand for eldercare. While these effects will take years to materialize, leaders planning for long-term care needs would be wise to consider scenarios where these and other potential “blockbuster” drugs may disrupt demand patterns and spending for a wide range of services.

GLP1 Drugs Graphic