FDA Approval of Generic Saxenda Boosts Teva Pharmaceuticals' Growth Prospects

Teva Pharmaceuticals received FDA approval for its generic version of Saxenda, a high-revenue branded weight management drug. This broadens Teva's generic drug portfolio and could capture market share in the growing weight management segment. However, the approval does not shift the company's biggest catalyst, execution on high-margin branded launches, or reduce core risks from debt and limited generics growth. The FDA approval expands the addressable market for a key product, highlighting Teva's ability to deliver new launches in both branded and generic categories.

Teva Pharmaceuticals has received FDA approval for its generic version of Saxenda, a branded weight management drug. This approval marks the first time a generic glucagon-like peptide-1 receptor agonist (GLP-1RA) medication has been approved for weight loss in the United States [1]. The generic Saxenda, which references Novo Nordisk’s previous generation of injectable weight loss drug, is now available for adult patients who are overweight or obese and have weight-related comorbidities. It is also suitable for obese patients aged between 12 and 17 years who weigh more than 60kg [1].

The approval of the generic Saxenda is significant for Teva, as it expands their generic drug portfolio and could capture market share in the growing weight management segment. Teva’s SVP and head of US commercial generics, Ernie Richardsen, noted that this is the fifth first-to-market entry for a generic product this year, highlighting the company's commitment to expanding its generic offerings [1].

However, the approval of the generic Saxenda does not shift Teva's biggest catalyst, which remains the execution on high-margin branded launches. The company continues to face core risks from debt and limited generics growth. The FDA approval, while expanding the addressable market for a key product, does not significantly alter Teva's strategic focus or mitigate these core risks [1].

The approval of the generic Saxenda comes amid a monumental rise in GLP-1RA sales, with next-generation drugs such as Eli Lilly’s Zepbound (tirzepatide) and Novo Nordisk’s Wegovy (semaglutide) earning substantial revenues in 2024. These sales cemented their position in the top ten best-selling drugs of the year [1]. However, the market share of Saxenda has dwindled with the introduction of more effective and longer-lasting alternatives like Wegovy. Analysts at GlobalData forecast that Saxenda’s sales will plummet to just $135 million in 2031, down 91% from its peak sales in 2022 [1].

The potential introduction of Lilly and Nordisk’s weight loss pills, namely orfoglipron and semaglutide, could further exacerbate Saxenda’s declining sales. Both pharma companies are racing to obtain FDA approval for their versions. However, GlobalData pharma analyst Costanza Alciati noted that generics entering the GLP-1RA market may encounter a different fate than branded Saxenda, as they are likely to capture “a big part of the patient share” [1]. The cost of therapy is a significant unmet need in the obesity space, and a liraglutide generic could boost the patient population able to access GLP-1RAs and allow patients to switch from branded drugs to an older generic if a lower-efficacy product is sufficient [1].

Moving forward, GLP-1RA sales are expected to remain on a steep upward trajectory, with analysts forecasting that the drug class will be worth $125 billion across the seven major markets by 2033 [1].

References:
[1] https://www.pharmaceutical-technology.com/news/teva-saxenda-generic-fda-approval-launch/
[2] https://www.fiercepharma.com/pharma/saxenda-knockoff-teva-launches-first-generic-glp-1-obesity
[3] https://www.benzinga.com/news/health-care/25/08/47397079/teva-launches-generic-glp-1-weight-loss-drug-with-fda-nod-for-saxenda