Jim Cramer Highlights 'Transformational' Impact Of Weight Loss Drugs Like Ozempic: Focus Now On 'Potential Winners' From The Same Narrative

What Happened: Jim Cramer outlined fresh investment prospects on Monday, revolving around the growing demand for GLP-1 drugs, typically administered for diabetes and obesity treatment.

As reported by CNBC, investors initially expressed concerns about these drugs’ market impact. However, with the market’s recent recovery, Cramer encourages focus on stocks that stand to gain from these drugs.

Immediate beneficiaries include leading GLP-1 companies Eli Lilly And Co LLY and manufacturer of Ozempic, Novo Nordisk A/S NVO. Cramer touched on potential stock gains as these drugs could potentially treat conditions beyond obesity and diabetes, such as heart disease, kidney disease, and alcoholism.

Other potential GLP-1 opportunities include high-protein food manufacturers like Tyson Foods or Hormel Foods, and construction companies like Jacobs Solutions specializing in creating pharmaceutical manufacturing facilities. The apparel sector, with brands like Levi’s already benefitting from changes in customer sizes, also holds potential, Cramer suggests.

“When the market was ugly, everyone was worried about how much money the food companies would lose from these GLP-1 weight loss drugs,” he said. “Now that the market’s much more optimistic, we’re focused on potential winners from the same story.”

See Also: Goldman Sachs’ 2024 Equity Outlook: Winning Stocks And Sectors To Watch

Why It Matters: The pharmaceutical industry’s recent focus on obesity treatment signals a shift in market dynamics. Companies with obesity drugs in their portfolio, like Novo Nordisk and Eli Lilly NYSE, have seen significant share price increases due to the success of their obesity drugs.

Moreover, competition is heating up, with pharmaceutical giant Roche Holding AG RHHBY recently acquiring privately held obesity company Carmot Therapeutics, aiming to rival Novo Nordisk and Eli Lilly in the weight-loss drug market. Carmot’s R&D portfolio includes clinical-stage subcutaneous and oral incretins for obesity treatment in patients with and without diabetes.

These developments underline the growing importance and potential profitability of GLP-1 drugs, creating new opportunities for investors in various sectors, from pharmaceuticals to food and construction.

Photo by s_bukley on Shutterstock

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