Episode summary
Lower Prices, Bigger Market: The Next Phase of GLP-1 Drugs
Thoughts on the Market (Morgan Stanley)
· · Guests: Terence Flynn, Thibault Boutherin
Summary
Cheaper semaglutide generics could broaden the obesity-drug market rather than simply shrink it, especially in underpenetrated countries where lower prices are already driving rapid volume growth. India is the clearest test case: the patent expired in March 2026, 13 companies have launched 26 generics, and volume in April 2026 was six times higher than in February. The analysts argue India’s GLP-1 market could rise from $125 million in 2025 to more than $1 billion by 2030 even as prices fall.
The analysts also see supply-chain risks as uneven. They expect no major bottleneck in the active ingredient or device components, but they see fill-and-finish capacity as the most likely constraint because it takes up to 3 years to build. That could limit how quickly generic makers scale in future markets.
Despite generic competition, the market may segment rather than commoditize. The analysts said tirzepatide appears less exposed because it offers stronger efficacy and tolerability, and they expect premium demand to persist. They also said oral GLP-1s are expanding the market by bringing in new users, while longer-acting drugs and agents targeting amylin and glucagon could create the next wave of differentiation.
Key takeaways
- The analysts said India’s semaglutide generics already captured 80% of local semaglutide volume in April 2026, signaling strong demand response to lower prices.
- They expect no major shortage of semaglutide API or devices, but fill-and-finish capacity could become the key bottleneck over the next 3 years.
- The analysts argued tirzepatide is less threatened by semaglutide generics because it has better efficacy and tolerability, supporting premium segmentation.
- They said oral GLP-1s are mostly bringing in new users rather than cannibalizing injectables, which expands the overall market.
- They expect US access to widen further as Medicare patients can access these medicines for $50 per month, adding about 18 million potential users.
Notable quotes
“we believe they could provide a blueprint for what could happen later in the US and in Europe”
“we are seeing affordability driving volume expansion”
“we believe there will be no bottleneck in supplying for generics”
“the fill and finish side. Fill and finish requires highly controlled clean room space to minimize contamination”
“the introduction in the US so far is expanding the market”
How the episode opens
Welcome to Thoughts on the Market. I'm Terence Flynn, Morgan Stanley's US Pharma and Biotech analyst. — And I'm Thibault Boutherin, Morgan Stanley's Europe Pharmaceuticals analyst. — Today, how cheaper GLP-1 obesity medicines could reshape access, pricing, and supply chains, and what the first generic markets may signal for Europe and the US. It's Monday, July 13th at 10:00 a.m. in New York.
And it's 3:00 p.m. in London. — Around 1 billion people live with obesity worldwide, including over 100 million in the US. Right now, the introduction of the first lower-cost generics of semaglutide, a GLP-1 medicine, in some international markets could have consequences on affordability and demand. Thibault, what are the first countries seeing the introduction of semi-generics? What are the current dynamics, and why should global investors pay attention?
Sure. So, so far, generics are being introduced this year in in three countries: in India, Canada, and Brazil. And if we look at India, this is the first market where the generics are being introduced.
The patent for semaglutide expired in March 2026. And 13 companies have launched 26 generics across different formulations, auto-injectors, vials, and pills, which price is lower than the branded drug. And because the India market was quite underpenetrated for GLP-1, we are seeing affordability driving volume expansion.
In Canada, two generics have been launched so far. Four other generics are waiting for approval, and more are being filed. And finally, in Brazil, one generic was approved last month, and we are expecting these generics to be launched in Brazil in July.
And 17 other generics are in different stage of regulatory review in Brazil, and we would expect more to enter the market by the end of this year. And the reason why we focus on these markets is because we believe they could provide a blueprint for what could happen later in the US and in Europe, in particular for Canada, which share some characteristics with uh Europe and the US.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- glp-1 drugs
- obesity medicines
- drug pricing
- supply-chain bottlenecks
- healthcare innovation
Watch the episode
Watch “Lower Prices, Bigger Market: The Next Phase of GLP-1 Drugs” on YouTube
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