Global Healthcare Pharmaceuticals The Obesity Evolution Cost of sema production nudges down, but still likely too high for...

Equity Research 30 July 2026 | 5:15PM BST

GLOBAL HEALTHCARE: PHARMACEUTICALS

The Obesity Evolution: Cost of sema production nudges down, but still likely too high for widespread oral generics

Following our recent deep dive Framing global AOM peptide manufacturing capacity and James Quigley | implications for the branded/generics markets, a new analysis by QYOBO Pharma Goldman Sachs International Intelligence Platform (see here) highlights that the number of semaglutide API Asad Haider, CFA manufacturers has increased to 62 from 57 at the end of 2025 (42 by the end of | Goldman Sachs & Co. LLC 2024). In terms of cost of production, the report highlights that the market price of semaglutide has stabilised between $200-300/g, although we note that the Nick Jennings | trajectory of the cost is moving towards the base case in our analysis of $150/g, as Goldman Sachs & Co. LLC the average cost was $170/g in Q1 26. Jeff Su | Goldman Sachs & Co. LLC In addition, the report highlights that five API manufacturers have filed applications to the FDA for generic versions of orforglipron, despite Foundayo only recently being Shyam Kotadia | approved and launching in the US. The average cost of production of generic Goldman Sachs International orforglipron per the QYOBO database was between $20-109/g, but we note limited Theodora Rowe Beadle volumes so far. We believe those products will not be able to launch in the US until | the orforglipron compound patent expiry (Sept 2037 per FDA Orange Book), and Goldman Sachs International

would expect Lilly to seek to protect its intellectual property rights during that period.

Overall, the API price is generally moving as expected, while the increase in the number of additional API manufacturers has slowed. Despite generic API manufacturers having filed orforglipron generics with the FDA, we do not expect a launch in regulated markers until the Foundayo compound patent expiration at the earliest. Further, at current levels, assuming a 50% gross margin for a generic manufacturer, the cost of the API could limit the price discount vs. branded oral semaglutide – although there is still time for manufacturing processes to improve. Given this, unless there are significant increases in the SPPS manufacturing processes for oral peptides, market prices of oral GLP-1 medications could see limited impact from traditional genericisation dynamics until September 2037 at the earliest, which is longer than investor baseline expectations. We will continue to closely monitor this dynamic.

Our view on the implications of these data points:

n If the average price of API remains in the $200-300/g range for semaglutide, it could limit the price discount for generic companies, unless they are willing to accept a <50% gross margin. At this level, we estimate cost-based pricing for

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Goldman Sachs Global Healthcare: Pharmaceuticals

generic oral semaglutide at around $270 for a month’s supply (for average API of 13mg per dose), which is not too differentiated from the current branded Wegovy pill ($149-$299 per month). At our base case of $150/g, the cost base pricing is in the region of $118 per month, which may not be differentiated enough to drive a significant switch from the branded version, particularly as Novo’s cost of production is significantly lower. n The slowdown in the number of new companies looking to supply semaglutide is interesting, and while there are still five months left in the year, it appears the number of new suppliers will be lower than in 2025. Given the cost of production and economies of scale, we would expect the number of suppliers to reduce, unless there is a significant…