Crypto News: The Forecast: Have obesity drugs peaked?

Welcome back to The Forecast, where we help you think about the future — from next week to next decade.

On Saturday, President Donald Trump levied 25% tariffs on Canada and Mexico, and 10% on China. You can follow Bloomberg's coverage here. And here's an explainer on the tariff plan and what Trump says he wants to achieve.

In the meantime, this week we're looking at the year for Ozempic and GLP-1s, the race to build AI applications and (yet again) the chances of a TikTok sale.

What the Obesity Drugmakers Expect in 2025

The two biggest names in the obesity-drug market, Eli Lilly & Co. and Novo Nordisk A/S are reporting earnings this week. While Wall Street's enthusiasm for weight-loss shots has helped make them two of the most valuable companies in the world, Lilly and Novo's rapid ascent has been losing steam amid higher expectations, rising competition and a shift in focus to newer drugs.

Investors will be closely watching for signs of a peak in demand for their blockbuster obesity and diabetes drugs as well as comments on the next generation of weight-loss medications.

Here are five things to look out for:

A number of quarterly misses in 2024 left investors pondering if demand is slowing or if their expectations are just becoming too high. So, the drugmakers' projection for sales in 2025 will be important, especially after Lilly flagged slower-than-expected demand for its fourth quarter.

Additionally, the companies' progress on their next-generation obesity drugs will be in focus as they fight to maintain their current dominance in the red-hot obesity market. Disappointing data from Novo's CagriSema trial in December dented optimism but hopes have been revived following successful results for its once-weekly amycretin shot in mid-January.

Rivals with a crop of experimental drugs — ranging from Viking Therapeutics Inc. and Amgen Inc. in the US to Roche Holding AG and Zealand Pharma A/S in Europe — are racing to replicate Lilly's and Novo's success. Any updates on how the current duopoly plans to position themselves against impending competition will be important.

Novo's recent win for Ozempic's use treating kidney disease will put attention on both companies' efforts to expand approval for their weight-loss shots. To boost insurance coverage and sales, both are conducting trials of their obesity drugs in a range of disorders from heart and liver diseases to controlling addictive behaviors like alcohol abuse, smoking and drug addiction.

Lastly, there's drug pricing. The eligibility of Ozempic and Wegovy for Medicare price cuts earlier in January raises the possibility that price changes for Novo's drugs could affect others in the same class.

— Angel Adegbesan, Bloomberg News

(Chart by Aaron Clark)

Predictions

"The worst is over for New York's beleaguered office market" — or at least that's the bet Blackstone is making in purchasing a Midtown Manhattan tower. — Natalie Wong and Jack Sidders, Bloomberg News

Ozempic could lower greenhouse gas emissions: A clean energy expert argues that, "if we end up in a world with 10% less craving for fats, sugars and junk calories," the crops could be diverted to biofuels and bioplastics. — Aaron Clark, Bloomberg News

AI won't use so much energy after all: "The DeepSeek development 'calls into question the significant electric demand projections for the US,' analysts led by Julien Dumoulin-Smith at Jefferies wrote in a note on Monday." — Michelle Ma and Mark Chediak, Bloomberg Green

"No European Union country will choose to add Bitcoin to its monetary reserves" says ECB President Christine Lagarde. — Mark Schroers and Craig Stirling, Bloomberg News

Those undersea cable attacks will continue: "Finland expects to see more damage to undersea cables in the Baltic Sea after several incidents since late 2023, President Alexander Stubb said." — Leo Laikola, Bloomberg News

Keep an Eye On

The AI Race Is About Adoption Now

By Friday, Alphabet, Meta and most of the AI "hyperscalers" had recovered from the week's DeepSeek selloff — on the theory that they're AI users, too, and so benefit from cheaper, ubiquitous models.

The race is now on to build new applications that make use of new, powerful AI models. But will the tech giants be the ones to win it?

Incumbents tend to succeed when a new technology improves one slice of their operations but they struggle when technology changes the way an entire industry fits together. The next round of AI apps will likely apply it to familiar slices of digital life — like AI bots in customer service or or better suggested edits in Microsoft Word.

But the most successful internet companies — like Google, Meta and Netflix — didn't just take an existing business and put it online. They created entirely new categories.

"The most defensible stuff will be in applications that are built on top of the foundational models," said Joshua Gans, an economist at the University of Toronto and co-founder of an AI tutoring startup, when I asked him last week about the effects of AI commodification. "I have yet to see the next Google, but I suspect that will appear in the next five years."

— Walter Frick, Bloomberg Weekend Edition

What Are the Chances...

38%

The chance that the sale of TikTok will be announced by ByteDance before April, according to Polymarket. Forecast as of 3:30 p.m. ET on Friday.

Weekend Reads

AI Has Rocked the Stock Market, But What Will It Do for the Economy?

Why The China Bubble Still Hasn't Popped

LA Needs More Than a Comeback — It Has to Move Forward

Who Should Have the Final Say Over Central Banks?

To Combat Shoplifters, Retailers Are Hiring Them to Steal

Week Ahead

Monday: Inflation data will be published for the Eurozone, Indonesia, Italy and Pakistan; the Seoul High Court will sentence Samsung Electronics Executive Chairman Jay Y. Lee; Palantir reports earnings.

Tuesday: Alphabet reports earnings the week after DeepSeek's AI models rattled tech markets; Israeli Prime Minister Benjamin Netanyahu will visit the White House.

Wednesday: Novo Nordisk, Uber, Disney, Qualcomm, Toyota and Ford report earnings; Indonesia reports GDP.

Thursday: The Bank of England is expected to cut rates by a quarter point and the Bank of Mexico by half a point; Amazon and Eli Lilly report earnings.

Friday: The US releases jobs data with openings expected to have declined slightly from November; the Reserve Bank of India is expected to cut rates by a quarter point.

Have a nice Sunday and a productive week.

— Walter Frick and Silvia Killingsworth, Weekend Edition; Angel Adegbesan, Bloomberg News