r/stocks Apr 26, 02:13 PM
LLY: The Foundayo bull case requires assuming people don't have sex I'm here to tell you the bull case for Lilly’s Foundayo rests on an unspoken assumption: nobody in the target demographic is having sex. Sounds crazy?
The facts:
Oral Wegovy seems to be more effective than Foundayo. ~14% vs ~11% weight loss at max dose in a cross-trial comparison.[1]
The injectable GLP-1 market is kinda old people. These are postmenopausal women and middle-aged dudes with metabolic syndrome. They signed up for needles, cold chain, and insurance fights. They have demonstrated they don't give a shit about friction.
The pill market is different. Younger. Lower BMI. Price-sensitive. Needle-averse. Convenience-maximalist. This is where Foundayo's growth has to come from.
Here's the kicker I suspect nobody is pricing in. Foundayo's FDA label requires women on oral birth control to either switch to non-oral contraception OR use condoms for 30 days after starting AND 30 days after each dose escalation. That's 3-6 months of continuous backup contraception to reach max dose.[2]
Oral Wegovy has no such warning. Semaglutide was directly studied for oral contraceptive interaction. No clinically meaningful effect. Zero friction, so to say.
The thesis:
Imagine you're a 32-year-old woman on the pill. You want to lose weight. You have two options:
Oral Wegovy: Take it in the morning, wait 30 min to eat (you already skip breakfast anyway). ~14% weight loss. No change to your birth control.
Foundayo: Take whenever you want. 11% weight loss. Also: use condoms for the next 3-6 months. Every time your doctor bumps your dose, the 30-day clock resets. Tell your boyfriend that his cucumber will be residing in a plastic bag for 3-6 months.
Which one do you pick?
This is not a hard question. This is the easiest A/B test in pharma. Lilly is saying that their products add “convenience”. However, that’s only if you are not on the pill.
I spun up a Jupyter Notebook, found some demographic data (birth control usage[3], age and gender of the patients[4]), and did some crude calculations:
My best guess is that 9-14 percent of the potential patients will be somewhat affected when you factor in that the mean age of the NEW users will be lower for the pill (I used 3 to 8 years in my simulated population). It's hard to say how much but the effect could very well be very real (but I l have tried to be conservative in my estimations).
As I said: For the injectables this is not that big of a problem - the customers have demonstrated that they can tolerate the friction and they are older (i.e. not on birth control). The birth control problem is only a problem for the marginal costumer.
But when the potential costumer base becomes younger, then the effects of this problem rises rapidly (that's just statistics).
The 9-14 percent is a huge number in my humble opinion… Also, I don’t factor in the narrative aspect of this problem: Lilly is trying to brand themselves as the “convenient” choice - but for women they could become the option that messes wi