What Will Be the Best Weight Loss Drug Stock of 2030: Eli Lilly, or Novo Nordisk?

While the market for anti-obesity medicines is characterized today by a fight between Novo Nordisk 's (NYSE: NVO) drug Wegovy and Eli Lilly 's (NYSE: LLY) drug Zepbound, that won't always be the case. Over the coming years, the competitive dynamics of the market for weight loss medicines will change, and the competition is going to heat up big-time.

Still, one of the two leaders of today's market is likely to be in the top position by 2030. Which will prevail? Let's evaluate the prospects for each.

A new report points to a key factor

Before getting started, let's set some expectations. A lot will change in the market for weight loss therapies between now and 2030. There are many different players looking to cash in, many different drug candidates in development, and many different niches with specific needs and requirements within the global population of patients. So the probability of one winner seizing the entire pie, or even a majority of it, is low.

That means the looming fight between Eli Lilly and Novo Nordisk is more accurately framed as a contest of who can catch the most fish in an ocean that's just over the horizon, rather than a scheduled head-to-head match in a well-defined ring.

The difference matters because it means there's more than enough room for both to succeed, even as smaller competitors make significant progress of their own. But when you evaluate the prospects of these two companies, it's important to realize that they can take actions between now and 2030 that'll invalidate any predictions made today, and they probably will.

That being said, a new report by Evaluate, a market research business, supports the idea that it'll be Novo Nordisk leading the market for weight loss drugs in 2030.

According to Evaluate, in 2030 Novo Nordisk's weight loss candidate CagriSema will generate recurring revenue in excess of $20.2 billion per year, while two of Eli Lilly's candidates, orforglipron and retatrutide, will bring in an estimated $8.3 billion and $5 billion respectively, for a total of $13.3 billion in annual sales. Assuming the company with better sales of weight loss drugs experiences more growth in its stock price as a result, Evaluate's prediction suggests that Novo Nordisk will be the better pick.

What's special about CagriSema?

But given what's known today, what makes the CagriSema program so special that it'll supposedly sell better than two competing drugs put together?

In short: its mechanism of action. Novo Nordisk's drug Wegovy, a trade name for the molecule semaglutide, targets a receptor on certain cells known as GLP-1. In contrast, Eli Lilly's drug Zepbound, a trade name for the molecule tirzepatide, targets GLP-1 and another receptor called GIP.

In terms of cellular physiology, there's more than one lever that could lead to weight loss if activated by a drug. Most available evidence suggests that Eli Lilly's approach of activating two types of receptors leads to more weight loss than just one. But the type of receptor matters, and of the entire complement of possibilities, some could potentially be more effective for the intended purpose than others, or perhaps cause fewer or less burdensome side effects. Furthermore, using multiple receptors could unlock powerful synergistic effects -- or counterproductive ones.

CagriSema is a combination of semaglutide (the same molecule as Wegovy) and a molecule called cagrilintide. Cagrilintide itself affects at least two other receptors thought to be associated with weight maintenance, satiety after eating, and blood sugar control, among other functions.

So in total, CagriSema aims to use three different physiological levers to fight obesity, which is more than nearly all other programs currently in development for weight loss. And that's bound to have a major competitive impact, assuming it gets approved for sale sometime in the next couple of years.

Eli Lilly doesn't have anything comparable in development. So if CagriSema lives up to its potential, it's hard to see how it wouldn't be the preferred option for prescribers, which would grant it a larger market share than any of Lilly's candidates that make it to the market.

The timing matters

Don't write off Eli Lilly just yet. While it currently has no programs that are as promising as CagriSema, it does have something Novo Nordisk lacks: a superior product on the market today relative to the competition.

Alhough Wegovy was approved first, over the next few years Zepbound is likely to take a larger share of the market because it's more effective for weight loss, despite comparable side effects. Eli Lilly's revenue will probably grow faster as a result.

So even if Novo Nordisk wins out in 2030, the odds are good that Lilly will take second place in market share by then.

If you're looking to invest in one of these two businesses, be aware that at the moment, Eli Lilly might be preferable. But it could easily make sense to invest in both -- because with such a large market up for grabs, there's plenty of growth to go around.

Alex Carchidi has no position in any of the stocks mentioned. The Motley Fool recommends Novo Nordisk. The Motley Fool has a disclosure policy .