文档内容
The Economist May 10th 2025 Business 55
▸ The company is made up of a for-profit Obesity drugs
entity—in which outside parties can Battle of the bulge Slim pickings 2
invest, entitling them to a return up to a
Obesity drugs, revenue, $bn
maximum value—nestled inside a non-
30
profit entity. As previously planned, the
Forecast
for-profit entity will become a public-ben- Novo Nordisk 25
efit corporation that seeks to serve both its Eli Lilly
20
shareholders and society at large; outside Eli Lilly looks set to steal Novo
investors will receive stakes in the new Nordisk’s weight-loss crown
15
company. But plans to unshackle it from
the control of the non-profit and its board BEING fiRST to market with a drug can 10
have been dropped. be crucial. Eli Lilly is proving that
Of most concern for OpenAIis how this being second but better can also pay. 5
affects its ability to raise money. It is Zepbound, the American firm’s weight-
0
burning through significant amounts of loss jab, was approved in its home country
2022 23 24 25 26 27 28 29 30
cash as it invests to develop ever smarter in November 2023, more than two years
Source: Visible Alpha *2025 onwards = forecast
models, and seems unlikely to turn a profit after Wegovy, made by Novo Nordisk, a
in the near future. When the company Danish rival. Over the following year it
announced its previous plan to restructure yielded $4.9bn in revenue, more than half list until February; Lilly had sorted out its
in December, it cited its vast funding Wegovy’s $8.2bn. On May 7th Novo cut its supply issues by last October. That left
needs. “Investors want to back us but, at sales forecast for 2025, citing “lower-than- Novo more exposed to “compounding”
this scale of capital, need conventional planned” growth in weight-loss drugs. Its pharmacies, which may copy branded
equity and less structural bespokeness,” it share price has fallen by a third since the drugs during shortages—at much lower
said at the time. start of 2024; Lilly’s has risen by about as prices. Novo expects revenue to rise now
OpenAI’s non-profit board, which much (see chart 1). that the Wegovy shortage is resolved and
temporarily ousted Mr Altman in Novem- The momentum is now with Lilly. sales of copycats must stop.
ber 2023, is a particular concern for some Visible Alpha, a data firm, expects its sales Lilly has been faster to find new sales
investors. It has since been expanded and of obesity drugs to overtake Novo’s by 2027 channels, too. In August it began selling
packed with people sympathetic to Mr (see chart 2). Lilly’s edge rests on a more low-dose Zepbound vials directly to
Altman’s ambitions.But it remains unclear effective drug, better execution, keener patients online for $399 (users supply their
how the board will balance his desire to pricing and a stronger pipeline. own syringes). In April it partnered with
rapidly develop AI models as clever as hu- Zepbound and Wegovy belong to a Hims & Hers, an online pharmacy, to
mans with concerns over the safety of the class of treatments known as GLP-1 expand sales. Novo followed after.
technology. agonists. First developed for diabetes, they Price has mattered as well. Many insur-
Mr Altman has argued that, despite the suppress appetite by slowing digestion. ers, including Medicare, America’s public-
U-turn, OpenAIwill still be able to secure Wegovy mimics the GLP-1 hormone; health scheme for the old, do not cover
the funding it needs. In particular, he has Zepbound targets an additional hormone, obesity drugs unless tied to another condi-
said that the $30bn promised by Softbank, GIP, thought to enhance weight loss. tion. IQVIA, a health-data firm, says that
a Japanese tech conglomerate, is still on That dual action matters. In a head-to- more than half of obesity prescriptions in
the table. Microsoft, the biggest investor in head trial conducted by Lilly, patients on America are paid for out of pocket.
OpenAI’s for-profit entity, remains san- Wegovy lost 14% of their body weight; Wegovy is listed at around $1,350 a month,
guine. But new investors may balk at pour- those on Zepbound, 20%. A third of Zep- Zepbound at about $1,000.
ing money into a company whose control- bound users shed at least 25%, twice the And the pipelines? CagriSema, Novo’s
ling board does not need to take their in- share for Wegovy. Prescribing has shifted: prospective Zepbound rival, tied with it in
terests into account. in the first quarter of 2025 Zepbound made recent trials; few doctors will bother
Meanwhile, ditching its previous plan up 60% of total weight-loss prescriptions encouraging patients on Lilly’s drug to
will not spare OpenAIfrom prying regula- in America, and 75% of new ones. make the switch. The results wiped 20% off
tors. The company said that its about-face Lilly has also been quicker to expand Novo’s share price in a day.
followed talks with civic leaders and the production in response to soaring demand. On the next front, oral drugs, Novo has
attorneys-general of Delaware, where Wegovy was on America’s official shortage a pill awaiting approval in America. But it
OpenAI is incorporated, and California, is costly to make, with the same active
where it is based. The California Depart- ingredient as Wegovy. Patients must also
ment of Justice said it was reviewing the The biggest loser 1 take it first thing in the morning with mini-
new plan. Delaware found it encouraging. mal water and wait 30 minutes before
Share prices, January 2nd 2024=100
But as a non-profit entity, OpenAI will eating. David Risinger of Leerink Partners,
175
continue to fall under their regulatory an investment bank, doubts Novo will
Eli Lilly
aegis. It can expect ongoing scrutiny. launch it globally. Lilly’s pill, orforglipron,
150
Nor has Mr Altman succeeded in get- is cheaper to make and can be taken with-
ting Mr Musk off his back. Shortly after the out fasting. Patrik Jonsson, head of Lilly’s
125
announcement of OpenAI’s reversal, Marc weight-loss division, says it has “millions
Toberoff, Mr Musk’s lawyer, declared that of tablets” available, ahead of its approval,
100
it “changes nothing”, as the company’s which is expected next year. Analysts
NYSE Arca
founding mission to develop AIthat bene- Pharmaceutical Index 75 reckon orforglipron will provide $16bn in
fits all of humanity “remains betrayed”. Mr annual sales by 2030.
Musk, who runs a rival lab, xAI, intends to Novo Nordisk Both firms face trouble ahead. Donald
50
proceed with a lawsuit to block OpenAI’s Trump’s tariffs, though on hold for now,
2024 2025
restructuring. He will continue to be a could hurt. Neither makes its entire Amer-
Source: LSEG Workspace
thorn in Mr Altman’s side. ■ ican supply locally. Last year Novo’s parent ⏩
C00356 Business The Economist May 10th 2025
▸ agreed to pay $16.5bn for Catalent, an co-authored. The man we named the best
American manufacturer, to boost its out- CEOof 2024 can be thin-skinned. Soft power
put in the country. In February Lilly And yet the software company he
Palantir Technologies, market capitalisation, $bn
pledged to invest $27bn in production at heads, worth $250bn and imbued with his
300
home. Still, Mr Jonsson points out that us-against-the-world bolshiness, is going
Donald Trump
“reshoring takes time”. A factory takes at from strength to strength. On May 5th it 250
elected president
least three to four years to build. reported that its revenue in the first three
200
Battles over price regulation in Ameri- months of 2025 increased by 39% year on
ca, the largest market, are another concern. year, the seventh quarter in a row of
150
Mr Trump wants to match prices abroad, blistering growth. Besides some weakness
which are typically lower. Medicare, which in Europe, the only dark cloud was a 12% 100
covers 66m Americans, has also dropped a slump in the share price the following
plan to reimburse obesity drugs. day—perhaps reflecting concern that 50
Even so, both firms can look forward to Palantir’s growth, however fast, might not
0
fat profits. More than 100 companies are justify the quintupling of its market value
2023 24 25
developing weight-loss drugs, but for now over the past year (see chart). Even so, as
Source: LSEG Workspace
it is a duopoly. Analysts expect that by Mr Karp put it, “Palantir is on fire.”
2030 Lilly will have 47% of a $90bn-plus Its success is emblematic of two trends.
market, to Novo’s 40%. And Denmark’s The first is generative artificial intelligence has enabled the firm to maintain gross
former star still has time to shape up. ■ (AI); Palantir helps firms adopt it. Second margins of 80%-plus. Its new AIplatform,
is the growing demand for intelligence and AIP, which maps and organises its custom-
defence technology in a world of border ers’ data to help them run large language
Palantir closures and superpower rivalry, where models, is following a similar path.
Us against Palantir (more controversially) excels. In The company’s approach to growth is
both fields, its edge comes from a unique just as unorthodox. A former employee
the world approach to profits, growth and culture. describes Mr Karp as Palantir’s salesman-
For about 20 years after it was founded in-chief, but the firm spurns traditional
in 2003, Palantir did not make a profit. It marketing efforts, such as steak dinners
PALO ALTO had the strange business model of embed- and golf. Instead it invites customers to
An unorthodox firm is profiting from ding lots of highly paid engineers with its “boot camps”, where they experiment with
the AIand Trumpian revolutions customers, hand-crafting software to solve its products.
bespoke problems. Mr Karp conceived of Palantir starts off with small projects
ALEX KARPacts like everyone hates him. these so-called forward deployed engi- for its customers and, if they are success-
As the boss of Palantir strutted the neers (FDEs) as being like bossy French ful, expands across the organisation. Pete
stage at a recent gathering of clients, he waiters in high-class restaurants who know Seurken, who runs supply chains for
got a kick out of sounding perverse, in his what customers want better than they do. Wendy’s, a fast-food chain, says Palantir’s
tousle-haired, punk-professor way. He They had to be pushy and persuasive. AIPsoftware enables his team to do in five
used words like “masturbation” and “self- But as their on-the-ground knowledge minutes what used to take 15 people a day.
pleasuring”. He berated Silicon Valley, was incorporated into software products, The rest of Wendy’s is interested. “That’s
though he was speaking in Palo Alto, its the number of FDEs per customer shrank [Palantir’s] mechanism. They come in and
heartland. At the last minute, he cancelled and the business began to scale profitably. generate such value…the rest of the organi-
an interview with The Economist, though he In the past two years, Palantir’s revenues sation takes notice,” he says.
used to sit on its parent company’s board; have surged while its employees, who Palantir needs relentless growth to
he did not like our review of a book he number 4,000, have barely increased. That justify a valuation that makes some on
Wall Street queasy. Before its latest sell-
off, Palantir’s valuation multiple of 56
times next year’s forecast revenue implied
that its annual sales growth would have to
rise to 50% for the next four years to be
realistic, says Brent Thill of Jefferies, an
investment bank. The hype is partly the
result of meme-stock investors. These
days, people can buy “Palantir to the
moon” T-shirts at Walmart, notes Mr Thill.
That loyalty is fuelled by Palantir’s
provocative culture, its most idiosyncratic
trait. Employees describe it as a firm with
few job titles and an embrace of “constant
disagreement”. The defiance partly stems
from its work on Western military and spy
contracts, which used to make it a leper
within Silicon Valley. Even today, with
more venture capitalists adopting a pro-
American approach to defence technolo-
gy, Mr Karp suggests they are fair-weather
friends, uncommitted to arming America.
The company vocally supports Elon
To the moon Musk’s work under President Donald ⏩
C003
