Can MedTech and GLP-1s Peacefully Co-Exist?
“The reports of my death are greatly exaggerated.” Most everyone is familiar with this famous yet inaccurate quote from Mark Twain, reportedly uttered in 1897 after the legendary author learned of premature reports about his demise. (For the record, late 19th-century media confused Twain with his seriously ill cousin, James Ross Clemens, to which the writer replied, “The report of my illness grew out of his illness. The report of my death was an exaggeration.”)
Regardless of exact wording, Twain’s reaction to his untimely death reports could be adopted by the medtech sector. As consumer demand for GLP-1 agonists surged last year—thanks mainly to their remarkable weight loss prowess—many pundits and investors envisioned a bleak future for the medical device industry.
An October 2023 Bloomberg article predicted that GLP-1 medications like Ozempic would continue to batter medical device stocks through year’s end before an eventual turnaround. Another October piece, from Investor’s Business Daily, highlighted concerns among medtech financiers about waning demand for medical devices and procedures. The newspaper cited a note from Needham analyst Mike Matson that stated, “Obesity is a contributing factor to many of the diseases treated with medical devices. If GLP-1s lead to a decline in obesity rates, we think it could eventually result in decreased demand for procedures involving medical devices.” Potential corporate victims reportedly included ResMed, Baxter International, Medtronic, Boston Scientific Corp., DaVita, Dexcom, Fresenius Medical Systems, Intuitive Surgical, and others, according to published reports.
The ABCs of GLP-1s
GLP-1 agonists are medications that help lower blood sugar levels and promote weight loss. The drugs accomplish these tasks by mimicking a hormone called glucagon-like peptide 1 (GLP-1), which prompt insulin production when blood sugar levels rise, according to the Mayo Clinic. Besides helping to control blood sugar levels, GLP-1s also may help lower the risk of kidney disease, stroke, heart failure, and heart disease. People on GLP-1 treatment regimens have experienced improved blood pressure and cholesterol levels, but researchers are not sure whether those benefits result from the drug itself or the weight loss.
With its multiple health benefits, the frenzy over GLP-1s is not surprising. Nevertheless, that excitement must be tempered with caution, as these drugs have side effects, are not for everyone, and at best, can only be part of an overall solution for those battling obesity and/or type 2 diabetes.
Cause for Concern?
Certainly, GLP-1s are set to be an important part of future healthcare solutions, assuming they lack any troubling long-term side effects. Consequently, there are a few surgical procedures and/or devices that may (emphasis on the word “may”) be impacted by GLP-1s’ widespread use, including bariatric surgery, glucose monitoring products, and sleep apnea devices.
Although medtech behemoth Medtronic has claimed GLP-1s would impact their bariatric surgery support devices, an argument can now be made that those products are essential for sustained weight loss and metabolic improvements.
Contrary to past pundit positions, we believe GLP-1s will increase the use of glucose monitoring devices and drug delivery patches. Here’s why: As patients experience the benefits of GLP-1 medications—particularly weight loss—they will be motivated to remain on these drugs, thereby eliminating the potential issue of treatment compliance. And patients who adhere to their GLP-1 treatment plan will be more likely to use drug delivery patches and/or glucose monitoring devices to ensure their blood sugar levels are kept in check.
As former medtech executives with backgrounds in the respiratory space, we understand the realities of sleep apnea among the world’s aging population. Sleep apnea patients often suffer from other co-morbidities such as hypertension, type 2 diabetes, or obesity, with those in the latter category more likely to battle sleep apnea than their lighter weight counterparts. And while we fully understand investors’ correlation between thinner slumberers and lower sleep apnea rates, we question their depth of analysis. Sleep apnea market data shows the condition is considerably under-reported, meaning sleep apnea is, in fact, vastly undertreated. Therefore, any relative GLP-1 success will probably have a minor impact at best on the overall sleep apnea market. This should be welcome news for ResMed CEO Mick Farrell, though he was never too worried in the first place.
Beyond the aforementioned three device categories, GLP-1s will benefit other products as well, including remote patient monitoring, sports medicine, joint replacement procedures, and certain vascular/heart procedures.
Remote patient monitoring is perhaps the most logical beneficiary of GLP-1 use. Patients experiencing lower blood sugar levels from GLP-1 drugs will likely be motivated to monitor more of their own physical parameters (i.e., Sp02, blood pressure, blood oxygen levels, etc.) via home-based devices. Manufacturers of traditional home monitors and patient wearables can rest easy.
Sports medicine and joint replacement makers also have little reason to worry. It stands to reason that a thinner, healthier population will (hopefully) become more active and engage in activities such as running, golfing, biking, skiing, pickleball, etc. Obviously, a more active population is a more prone to injury (especially those enjoying middle age or their golden years), so theoretically there should be little to no impact on orthopedic-related procedures. Sports medicine doctors will still treat their fair share of worn-out knees and shoulders in a patient population that has newfound motivation to exercise.
Surgeons performing certain vascular/heart procedures (renal denervation for hypertension, stents for improved arterial blood flow, etc.), could indirectly benefit from GLP-1 use as well because patients might be more motivated to take charge of their overall health. Power to the patient.
Indeed, all the forecasts of medtech’s “death” at the hands of GLP-1s have greatly been exaggerated. There is no reason (thus far) to think that medical technology and wonder drugs like Ozempic cannot co-exist and be mutually beneficial to each other. Thankfully, one is not mutually exclusive of the other. Both are set to grow and thrive as the world’s aging population looks to extend their life for as long as possible. Here’s to healthy living!
Florence Joffroy-Black, CM&AA, is a longtime marketing and M&A expert with significant experience in the medical technology industry, including working for multinational corporations based in the United States, Germany, and Israel. She currently is CEO at MedWorld Advisors and can be reached at florencejblack@medworldadvisors.com.
Dave Sheppard, CM&AA, is a former medical technology Fortune 500 executive and is now focused on M&A as a managing director at MedWorld Advisors. He can be reached at davesheppard@medworldadvisors.com.
