General Industry Update

In January, Eli Lilly announced a move to offer telehealth prescriptions and direct home delivery of certain drugs through its new platform, LillyDirect. While this move alone might not significantly disrupt the traditional drug distribution system, it does signal a shift in the pharmaceutical industry towards direct-to-consumer models and sets a precedent for other companies to follow suit. 

The company’s initiative aims to increase access to medicines for chronic diseases like obesity, including Eli Lilly’s popular weight loss drug Zepbound. Patients using LillyDirect can bypass doctor visits for prescriptions and pharmacies for refills by using telehealth options. While this approach may benefit high-selling therapies, it could be more challenging for smaller or specialized medications requiring specialized administration. 

Eli Lilly’s move follows other industry shifts towards simplifying drug pricing and distribution, such as CVS Health’s adoption of a model similar to Cost Plus Drugs, aiming to reduce medicine prices. With increasing pressure for cost transparency and accessibility, more pharmaceutical companies may explore direct-to-consumer approaches, potentially reshaping the traditional drug supply chain.1 

Meanwhile, elsewhere in the industry, drug makers are looking overseas for opportunities. 

Speaking in Davos in January, Kasim Kutay, the CEO of Novo Holdings (which controls 77% of Novo Nordisk A/S), said that Novo Holdings would be plowing its dividends from Novo Nordisk’s massive success with medicines for diabetes and obesity into acquisitions and investments in Asia and India. Kutay sees opportunity in that region thanks to a growing middle class.2 At the same time, AstraZeneca Plc and Sanofi received word in January that China has approved the use of Beyfortus, a long-acting monoclonal antibody vaccination the two companies co-developed against RSV (respiratory syncytial virus). RSV is an inflammation of the airways that can lead to death in infants. The demand for vaccines against RSV is expected to be a $1.5 billion market in China by 2030.3 

Company Specific Updates

Sanofi S.A.

Sanofi has announced its acquisition of U.S. biotech firm Inhibrx Inc for up to $2.2 billion. This move is part of Sanofi’s strategy to expand its portfolio of innovative medicines to help reduce dependence on its blockbuster drug, Dupixent. The acquisition includes all assets and liabilities related to INBRX-101, an experimental therapy for alpha-1 antitrypsin deficiency, a genetic disorder affecting the lungs and liver. While INBRX-101 is still in mid-stage clinical testing, Sanofi sees potential in its development for treating patients with this condition. 

Source: Sanofi branding, Bloomberg

The deal reflects Sanofi’s broader efforts to strengthen its pipeline in areas like immunology and rare diseases. With a focus on increasing R&D spending, Sanofi anticipates a significant uptick in late-stage clinical trials over the next few years. Notable products in Sanofi’s pipeline include Altuviiio for hemophilia, Tzield for type-1 diabetes, amlitelimab for atopic dermatitis, and frexalimab for conditions such as multiple sclerosis. The acquisition aligns with a trend of heightened acquisition activity in the biotech sector as companies vie for promising assets and innovations.4 

Novo Nordisk A/S

Novo Nordisk soared past the $500 billion market value mark in January on the back of optimism surrounding its obesity drug, Wegovy. Novo Nordisk is only the second European firm to achieve this milestone, after luxury goods giant LVMH. 

Demand for Wegovy and its sister drug, Ozempic, has surpassed expectations, prompting Novo to invest $8.7 billion last year to enhance its manufacturing capabilities, leading to a doubling of shipments of Wegovy starter doses in the U.S. 

Source: Reuters

Novo does face growing competition in the obesity and diabetes drug market, especially with the entry of Lilly. Nevertheless, Novo remains optimistic, forecasting revenue growth up to 26% and operating profit up to 29% this year. 

Novo’s CEO, Lars Fruergaard Jorgensen, anticipates a decline in Wegovy’s net price over time as more insurers cover the drug. Additionally, a recent study showing Wegovy’s potential benefits for overweight people with heart disease could expand its market further, pending regulatory approval for these patients.5 

LIFE ETF: An Easy Way to Invest in Global Healthcare

Investing in ETFs can be one way to add cutting-edge healthcare to your portfolio. 

Evolve Global Healthcare Enhanced Yield Fund (LIFE ETF) provides investors with exposure to twenty global blue-chip companies in the healthcare industry, with a covered call strategy that is actively managed to provide increased yield potential while helping mitigate risk. For more information about the Evolve Global Healthcare Enhanced Yield Fund or any of Evolve ETF’s lineup of exchange-traded funds, please visit our website or contact us. 

Portfolio Strategy and Activity

For the month, Intuitive Surgical Inc made the largest contribution to the Fund, followed by Stryker Corporation and Novo Nordisk A/S. The largest detractors to performance for the month were Pfizer Inc, followed by Bristol Myers Squibb and Gilead Sciences. 



  1. Constantino, K., “Eli Lilly’s direct drug sales alone may not upend the industry, but others could follow suit,” CNBC, January 5, 2024;
  2. Kresge, N. & Wienberg, C., “Novo Nordisk Owner Will Invest Ozempic Profits in Deals in Asia,” Bloomberg, January 19, 2024;
  3. Liu, J., Dong, L. & Bloomberg News, “China Approves AstraZeneca, Sanofi Shot to Prevent RSV Infection,” Bloomberg News, January 2, 2024;
  4. Loh, T., “Sanofi to Buy Biotech Firm for $2.2 Billion in Innovation Push,” Bloomberg News, January 23, 2024;
  5. Kresge, N. & Rees, K., “Novo Nordisk Smashes Past $500 Billion Value on Wegovy Frenzy,” Bloomberg, January 31, 2024;
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