How digital health companies are capitalizing on the GLP-1 boom

For Gray Beard, a kindergarten teacher in Charlotte, North Carolina, losing weight had become a daunting endeavor. She’d attempted five different regimens in her life and never seen long-term success.

Her luck began to alter last year, when she noticed an Instagram promotion for the Ro Body Program, a new offering from online health firm Ro. The advertisement stated that qualifying patients could be offered GLP-1s, a popular class of obesity medications that has grown into a lucrative business in recent years.

Beard, 47, had previously requested a GLP-1 prescription, but her doctor “wouldn’t even try” to have it approved, expecting her insurance company would deny coverage for the expensive medication, she claimed. GLP-1s typically cost $1,000 per month before insurance and other rebates.

Customers of Ro’s Body Program may receive a GLP-1 prescription, such as Novo Nordisk’s Wegovy or Ozempic, and consult with a doctor on a monthly basis. They also get access to an instructional curriculum, 24-hour messaging, one-on-one coaching with nurses, and help negotiating insurance issues.

Beard weighed 210 pounds when she originally started the program early last year. She has since lost 40 pounds and works as an advocate for Ro. She pays $30 per month for GLP-1 medication after insurance reimbursement, plus a $145 monthly program cost. She has no plans to depart.

“I’m fine if I have to stay on it forever,” Beard told CNBC.

Ro, started as Roman in 2017, is one of a growing number of digital health firms attempting to capitalize on the rising demand for GLP-1s by developing programs and services for customers in addition to the drugs. The opportunity might be huge. According to Goldman Sachs analysts, the anti-obesity medicine business is expected to generate $100 billion in annual revenue by 2030, with 15 million U.S. people taking them.

The GLP-1 class includes prominent weight reduction drugs Wegovy and Ozempic, as well as Eli Lilly’s Zepbound and Mounjaro for diabetes. GLP-1s resemble a hormone generated in the gut that suppresses appetite and regulates blood sugar.

Non-drugmakers such as Calibrate, Sesame, Omada Health, Noom, Hims & Hers, as well as telehealth industry veterans Teladoc Health and WeightWatchers, have launched or expanded their services to include GLP-1s.

Meanwhile, investors cheer them on.

Shares of Ro rival Hims & Hers rose 28% on May 20 after the business announced that it will now offer compounded GLP-1 injections in addition to oral medicine kits. CEO Andrew Dudum told CNBC that the company is optimistic clients will be able to obtain a continuous supply of the injections.

Supply shortages are one of the major challenges for market players, as rising demand has made it impossible for many patients to obtain medicines. There has also been an increase in counterfeit products, according to the World Health Organization, which stated in January that the combination of shortages and the “increased circulation of falsified versions” is especially problematic for Type 2 diabetes patients who rely on the medication for disease management.

That has not deterred industry executives such as Ro founder Zachariah Reitano.

Ro did not start as a weight-loss firm. Reitano began selling therapies for erectile dysfunction online before expanding into hair loss and other conditions.

In 2020, Ro turned to obesity management, and after Wegovy was authorized by the Food and Drug Administration the next year, Reitano said patient requests began to flood in by the “tens of thousands.”

Ro is now pouring marketing dollars into its GLP-1 program, including digital ads, TV commercials, and posters in subway stations, as well as influencer efforts showcasing patients like Beard.

Reitano told CNBC that GLP-1s act as a “jetpack for positive behavior change.” According to him, patients prefer to exercise more, eat healthier, and reduce their calorie intake by about 30%.

“Once you get a little bit of momentum, once you lose a little bit of weight, you’re sleeping better, you have more energy, you can go to the gym, you can eat better and then that’s that positive flywheel,” Reitano stated.

Ro has raised approximately $1 billion in funding to date, according to PitchBook. The company was valued at around $7 billion in early 2022, but that was before a sharp drop in tech equities and a collapse in the initial public offering market led many startups to drastically reduce their values.

WeightWatchers entered the market.
WeightWatchers has been in business for over 60 years and is widely recognized in the United States as a leading provider of weight loss solutions.

In December, the business entered the GLP-1 market with a behavioral-support program offered through its general membership subscription, which costs $23 per month. Members can participate whether they receive a GLP-1 prescription from their regular care physician or from the new WeightWatchers Clinic, which was launched alongside the behavioral program.

Because GLP-1s decrease appetites, WeightWatchers rapidly realized that it needed to create a totally new program for those using the medication, according to Gary Foster, the company’s chief scientific officer.

“They don’t need help with what to do for dessert or how to deal with the bread on the table at a restaurant,” Foster explained in an interview. “That’s like 50-60% of what we would do for people without meds.”

Clinic members who enroll in the GLP-1 program must pay an extra charge, which begins at $99 per month, for exclusive access to registered dieticians, fitness specialists, and care coordinators.

WeightWatchers reported in its first-quarter statistics earlier this month that 87,000 people have joined the clinic, albeit not all of them are using GLP-1s. The company intends to have 140,000 to 160,000 clinic subscribers by the end of the year, according to the report.

It has not been enough to alter WeightWatchers’ trajectory. The stock has fallen 83% this year due to concerns about the company’s debt load, its primary weight loss business, and Oprah Winfrey’s planned exit from the board in February.

In terms of GLP-1s and their effect on weight loss, “the landscape is quite exciting,” Foster said. “I think we should all celebrate and really be delighted by the fact that there are more tools in the toolbox to help people trying to manage their weight.”

Jennifer VanGilder, a 51-year-old economics professor at Ursinus College in Collegeville, Pennsylvania, claimed she had tried numerous weight-loss approaches, including rigid diets and services like the defunct Jenny Craig. She was pondering bariatric surgery when she came across a program offered by digital health firm Calibrate.

Calibrate, launched in 2019, was one of the first companies to treat obesity with GLP-1s and one-on-one coaching. The program costs $199 each month, not including medicine, and needs an initial three-month commitment.

VanGilder signed up about four years ago and began taking Ozempic, a weekly diabetes injection designed exclusively for weight loss. She eventually switched to Wegovy.

VanGilder stated that GLP-1s are not a miracle treatment, but by taking them and putting in the effort, she shed approximately 100 pounds of her 242-pound weight. The main difference between Calibrate and previous weight loss efforts, according to VanGilder, is that she does not feel like she is dieting.

“That’s why I’ve been able to stay on it for as long as I have,” VanGilder stated.

Calibrate is one of the few companies that frequently releases reports on the success of their weight loss program. The company’s 2024 study analyzed data from approximately 16,000 participants who had completed at least one year of the program as of October, as well as a smaller group of patients who had stayed for extended periods of time.

According to the findings, patients lost an average of 16.2% of their body weight over the 12-month program, 17.3% at 18 months, and 17.9% at 24 months.

“Our data of proven outcomes shows that we can deliver faster, better results than some of the leading GLP-1 clinical trials,” said Dr. Kristin Baier, Calibrate’s vice president of clinical development, during an interview.

However, Calibrate has encountered some significant speed bumps in recent years.

After collecting $100 million in venture investment during the top of the tech market in 2021, the business was forced to lay off hundreds of employees between 2022 and 2023 due to supplier shortages, insurance issues, and a larger market downturn. Madryn Asset Management, a private equity group, paid a discount to acquire the company in October.

Calibrate CEO Rob MacNaughton stated that the industry was “ill-equipped” to handle the “dramatic demand that led to, at some point, severely, severely constrained supply” of GLP-1s last year.

Under new management, the company continues to push its GLP-1 service, which it claims is necessary because the medications alone are insufficient.

“GLP-1 medications, while they are safe and effective, they are a tool,” Baier stated. “They are not the entire treatment.”

Options for Patients
According to Ro’s Reitano, last year’s shortages of Wegovy and other GLP-1s forced his company to temporarily cease advertising. Ro also provided refunds and credits to patients in its program who were unable to pick up their medication within 30 days of receiving a prescription, he stated.

Reitano stated that Ro has developed “both technical tools and operations” to assist patients with supply concerns. This involves moving medications to multiple pharmacies based on GLP-1 availability and proximity to the patient. From July to August, the business called 50,000 pharmacies in the United States to coordinate the transfers, according to Reitano.

Ro has also increased its drug options, including Zepbound, which was approved in the United States in November.

“We added that to our formulary, and that’s really when we started advertising again because we had confidence that we’d be able to get patients an option,” Reitano stated.

Insurance issues persist, however.

Some businesses have removed weight loss medicines from their plans due to the high expenses associated with providing treatments for thousands of individuals. By law, the federal Medicare program cannot fund weight loss medications unless they are prescribed for another qualified health benefit, such as diabetes or cardiovascular health.

Eli Lilly and Novo Nordisk offer commercial savings card schemes to increase access to their GLP-1s. Eli Lilly offers patients with Zepbound insurance coverage to pay as little as $25 per month for their prescription. Users who do not have insurance coverage may be able to get the medicine for as little as $550 per month.

Despite releasing a new weight loss program in December, Hims & Hers initially avoided the GLP-1 market due to high costs and restricted access.

Dr. Craig Primack, senior vice president of weight management at Hims, explained that the company chose to offer treatment regimens based on medications that had been studied and recommended for decades.

“We’re going to have people who, for whatever reason, don’t want an injection at this point or are simply looking for a different option,” Primack told CNBC in March. “These are tools we’ve been using in our field for a long, long time.”

Last week, Hims announced that clients can now receive compounded GLP-1 drugs on the platform with a prescription from a registered healthcare professional. Hims stated that it intends to make branded GLP-1 drugs available to clients once supplies are consistent. The company’s oral pharmaceutical kits start at $79 per month, while its compounded GLP-1 injections begin at $199 per month.

Dudum stated that the company has worked with one of the major generic manufacturers in the United States and has a certain level of exclusivity over the facility. The manufacturer is subject to FDA inspection, he stated.


Even before Hims added compounded GLP-1 injections to its weight loss offerings, the business predicted that the program will produce more than $100 million in revenue by the end of 2025.

Beard, the Ro customer, has had to make some adjustments after beginning the Body Program. She first took Wegovy with no out-of-pocket expenses because to her insurance coverage and Novo Nordisk’s savings card program. But she reached a plateau with the medicine, so she moved to Zepbound.

While there have been some snags along the road, Beard claims the program has been a “seamless” addition to her daily routine, and she no longer worries about food constantly. She even convinced a family member to enlist.

“We’re not having any bad side effects, so why go off of it?” she responded. She continued, “it’s helped both of us get to the weight we want.”