Skinny pills
Novo Nordisk puts us on a diet
Good morning, American eaters. This is your Stock Market Rundown for September 12th, 2023. Thank you again for joining me—I appreciate you. Let’s dig in:
TODAY’S TOP STORY: BIG PHARMA SLIMS DOWN 💊
Novo Nordisk just became the world’s most valuable company, dethroning LVMH. How did a Danish pharmaceutical company get bigger than the leading luxury conglomerate?
It’s all thanks to Novo’s blockbuster weight-loss drugs, Ozempic and Wegovy. The active ingredient in these magical drugs isn’t new—it’s been used to treat diabetics since the ‘80s.
What caused the current craze are studies showing the drugs helped obese patients lose 15% of their body weight in a year, thanks to slowing down digestion. Caution: occasionally they slow digestion too much and your stomach stops working. But don’t sweat the details, folks!
Now, so many Park Avenue princes and princesses are on “the shot”, chic New York restaurants are cutting portion sizes. You’ll even see these drugs advertised during baseball games. (Fitting, since baseball is the only sport where the athletes eat Twizzlers on the sidelines.)
That’s giving health insurers a big fat headache. Two-thirds of Americans are obese or overweight, and these drugs clock in at $900 a month. You do the math: it’s a multi-billion-dollar potential spend.
The question for us as investors is: how will these drugs change society? Are they bearish for quick-service restaurants, since dieters will now be ordering a Happy Meal instead of a Big Mac and supersized fries? Bullish for the garment industry, as folks who score a prescription will shed thirty pounds and buy a whole wardrobe of extra-small clothes?
One winner is obvious: big pharma. The CEO of Novo Nordisk says they’re running factories “24/7” to pump out enough drugs to get us fitting back into our skinny jeans. So much for body positivity.
SO WHAT ELSE IS GOING ON?
TikTok has launched ecommerce, hawking cheap Chinese merchandise in the feed, but early shoppers have noticed it’s plagued with counterfeit items and scams. Steer clear for now, unless you want a curling iron that lights your hair on fire.
The diamond cartel that has had a chokehold on the female sex for generations may be fracturing: DeBeers is slashing prices on diamonds due to competition from lab-grown stones.
If you have an account at some podunk regional bank with twelve branches, it might be time to move to one of the big boys. The US’s head banking regulator is losing sleep over the “significant challenge” to the banking industry, due to higher rates.
A French billionaire has just acquired iconic agency CAA, which manages stars from Brad Pitt to Billie Eilish, for $7 billion. Getting 10% of the income streams of the top talent in Hollywood is a royalty on America’s love of escapism.
Sketchy websites are selling knockoff versions of weight loss drugs like Ozempic under a “research” loophole, via online ads encouraging customers to “Make HUGE GAINZ”. I salute the risk tolerance of anybody injecting substances into their body that they purchased off an Instagram ad from a company called “Swole AF”.
That’s it for today, crew; see you bright and early tomorrow. Yours in capitalism, The Axe