Statins didn’t displace interventional cardiology: A lesson for GLP-1s

February 16, 2024

Drugs like Ozempic are making an enormous impact in healthcare, but what will this mean for the broader medical device industry?

In the late 1990s, the U.S. Food & Drug Administration (FDA) approved Lipitor, a prescription statin drug that lowered cholesterol. Medical device investors feared an apocalypse, expecting a sharp decline in minimally invasive heart surgeries and their associated devices.

If arterial plaque forming cholesterol was eliminated with a once-daily pill, the number of high-risk cardiovascular patients would drop and so would heart attacks and preventative surgeries: A simple and logical conclusion.

Lipitor went on to break records. In its first year, 8.4 million prescriptions were written for the drug, and it garnered a record $582.7 million in sales. By 2004, global sales of Lipitor exceeded $10 billion and rose near $13 billion by 2006, which, at the time, was also a record for a single prescription drug.

As it turns out, Lipitor was not the silver bullet. Correlated data shows that while there was a 14% decrease in the annual rate of coronary revascularizations between 2001 and 2008, the long-term impact on cardiovascular medical devices fell short of dire predictions.

Cardiovascular medical device industry shows no signs of slowing

For all the advances in pharmaceuticals and medical procedures, cardiovascular disease is still the leading cause of death globally and associated preventative surgeries are still on the rise. Between 1990 and 2019, there was a 54% increase in heart disease related deaths, according to the World Health Organization (Source: Our World in Data). Risk factors such as environment, poor diet, lack of physical exercise, tobacco use/smoking and alcohol consumption are all factors in increased heart disease.

The practice of interventional cardiology includes several procedures aimed at opening the blood vessels and arteries and revascularizing the heart without performing major surgery. Percutaneous Coronary Intervention (PCI) procedures specifically refer to opening narrow arteries (caused by arteriosclerosis) and allow blood to flow to the heart. Coronary stents (bare-metal stents, drug-eluting stents and bioabsorbable stents) used for this procedure made up the largest portion of the interventional cardiology market in 2022.

Various research bears out this argument:

“You can observe a lot by watching.”

Here we are decades later, and glucagon-like peptide 1 agonists (GLP-1s) developed to combat diabetes – a leading indicator of heart disease – have found fame as a weight loss remedy. GLP-1s’ promise as miracle weight-loss drugs is due to their ability to mimic the body’s hormones to control insulin and appetite.

Eliminating obesity in a vast subset of patients indicates a major sea change in healthcare and, like the introduction of statins, threatens a myriad of medical device categories – from diabetes management devices to CPAP machines used for obstructive sleep apnea, and bariatric surgery, cardiovascular and orthopedic procedures.

The effect of these medications on the MedTech space is expected to be much more profound than the effect of statins. Drugmakers Novo Nordisk, who manufactures well-known Ozempic and Wegovy, and Eli Lilly who makes Mounjaro and Zepbound, together racked up $6.2bn in 3Q 2023 sales, an annualized rate of approximately $25bn, already almost double the peak sales of statins. So, the cloud over the MedTech sector is bigger and darker this time, and the market shows it.

In 2023, the MedTech space lost an estimated $380 billion in market capitalization anticipating that GLP-1 drugs would have a major impact on medical device demand, according to Mizuho research. The market’s knee-jerk reaction has since corrected in some sectors of MedTech, as investors are comfortable that the effects of GLP-1s will take time to manifest.

The 2030 Effect May Mute Effects of GLP-1s 

By all estimates, demand for GLP-1s is expected to balloon in the future. But this time, demographics will have a significant impact on how the market for medical device procedures plays out. The generation of adults who took Lipitor when it was introduced were the “Baby Boomers” born between 1946 and 1964 and who would have been between 33-to-53 years of age when Lipitor was released. Only a subset of the Baby Boomers was reaching an age where cardiovascular risks were rising.

By 2030, however, the number of Americans over the age of 65 will double and reach close to 70 million people, up from 35 million in 2000 and, for the first time in history, the U.S. will have more residents over the age of 65 than children under the age of 18 years.  These adults will live longer and there will be a much larger population who are obese, have diabetes, hypertension, and other medical conditions that could require any number of procedures, regardless of a drug’s impact. Wear and tear on joints, bones and organs as people age all mean increased demand for device intervention.

Not a Zero-Sum Game

All things being equal, clinical trials have proven the effectiveness of GLP-1 drugs in controlling diabetes and weight. Large drugmakers are gearing up to meet expected peak demand buying up extra production capacity Novo Nordisk this month said it would acquire three manufacturing sites to ramp up production in the next two years.

Regulation, for now, has been highly supportive of these medications given the clinical evidence of their profound cardiovascular effects. If this remains the case, the result will undoubtedly impact some MedTech revenue and market share. And the drumbeat will continue unabated, with GLP-1 trials expected to be released this year examining their impact on knee osteoarthritis and obstructive sleep apnea.

However, as with Lipitor, this is not a zero-sum game. Statins did not bring about the end of heart procedures and demographic tailwinds for the medical device sector remain undeniably strong. The cost, insurance coverage, availability, potential long-term side-effects, and durability of clinical response related to GLP-1s persist, and our body of clinical knowledge is expanding daily. In the meantime, we expect the MedTech sector to hunker down and demonstrate to patients, payors, and investors how their therapies can be used in concert with GLP-1s, and consider how their total addressable markets may increase as new patients become eligible for procedures they may previously not have been candidates for.

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