Inside WeightWatchers' shift on Wegovy, Mounjaro, other GLP-1s

In early May, the stars came out to talk about weight and body image at an event in New York City.

WeightWatchers sponsored the invite-only event, which was hosted by Oprah Winfrey and featured actresses Rebel Wilson, Busy Philipps and Amber Riley, TikTok influencer Katie Sturino and multiple weight health experts. But the biggest star of the night might have been an acronym with three letters and one number: GLP-1s. 

Related: WeightWatchers launches telehealth clinic with GLP-1s

The event comes at a time when every discussion about weight loss medications seems to involve glucagon-like peptide agonists. The healthcare industry is awash in companies standing up telehealth businesses centered on GLP-1s, ranging from Rochester, Minnesota-based Mayo Clinic and pharmaceutical giant Eli Lilly to less-well-heeled upstarts.

WeightWatchers is attempting to transition from a company that has traditionally sold a dieting program to subscribers and employers to one offering multiple weight health solutions, including a virtual care business with GLP-1s. The biggest question it faces is whether it can stand out in a crowded field while dealing with skeptical investors. 

CEO Sima Sistani has been on a mission to expand the company beyond its roots since she came aboard in March 2022. In December, the company launched WeightWatchers Clinic, following its March 2023 acquisition of telehealth weight loss company Sequence. The Sequence clinical team and its telehealth platform were rolled into WeightWatchers Clinic, a subscription-based business for consumers or offered within a package for employers. Clinicians employed by WeightWatchers Clinic are able to prescribe certain patients GLP-1 medications such as Novo Nordisk’s Wegovy and Eli Lilly’s Mounjaro.  

“When I joined the company…I was heartened to see there had been a lot of progress made with people receiving GLP-1 medications [with them] showing a lot of success,” Sistani said. “And so, it was clear as one of the leaders in weight loss, that if we were going to serve our members with whatever their acuity of needs would be, we’d need a telehealth offering.”

The company also offers a behavioral program for people on GLP-1s regardless of who prescribed them. The program, which focuses on ensuring patients taking the medications have adequate nutrition, hydration and physical activity, does not require a subscription to WeightWatchers Clinic. 

Companies like WeightWatchers are selling their GLP-1-centric virtual care programs to both subscribers and self-insured employers, the latter of which are looking for solutions to ease the cost of the pricey drugs. 

“It’s becoming one of the top spend categories for employers, so they’re freaking out,” said Craig Hasday, president of the employee benefits practice at employer consulting firm EPIC Insurance Brokers & Consultants. “They’re trying to figure out what to do because while these employers are putting the screws on GLP-1s, their employees and families are demanding them.” 

Investors are uncertain that WeightWatchers’ shift will help the company manage its $1.4 billion in debt while offsetting yearly revenue declines in its main program. The company’s stock price hit a high of $101.10 per share in June 2018. Friday it closed at $1.30 per share. Ratings agency S&P downgraded the company’s debt to CCC+ from B- in March and called its capital structure “unsustainable.” 

Winfrey departed the board of directors in May after serving on it for nearly a decade and donated her financial stake. A spokesperson said she remains a “strong strategic voice and collaborator with WeightWatchers.” 

Can WeightWatchers capitalize on GLP-1 fever? 

Of WeightWatchers’ 4 million total subscribers, 87,000 are paid members of the Clinic program, which generated $18.8 million in first quarter. Sistani said the goal is to get to at least 140,000 Clinic subscribers by the end of the year. 

Some analysts question whether the company can stand out in a crowded field, particularly since its reputation has been built on dieting and behavior change rather than weight loss medications. 

"WeightWatchers historically has been about moderation. It has been about behavior change and trying to address weight loss and health in a very healthy, measured manner," said Chris Deacon, founder of employer benefits consultant VerSan Conulting. "Pushing GLP-1s is incongruent with that mission."

Sistani said the company doesn't make money off GLP-1 prescriptions. "The medication itself, we don't make any profit from," she said. "We send it to your pharmacy just like any other doctor."

WeightWatchers is hoping employer customers can drive its shift from the traditional focus on dieting to a more fully integrated obesity health company.  As part of this shift, the company hired Dr. Amy Meister in September from the University of Pittsburgh Medical Center as its first chief medical officer. Prior to UPMC, Meister worked at UnitedHealth Group where she analyzed how weight loss medications could improve health outcomes and lower costs for the insurer's employee base.

While WeightWatchers does not break out revenue from employers, most of its enterprise customers have traditionally offered the Points Program at a discount to employees, Meiser said.  A few companies, such as Labcorp, have signed on to offer WeightWatchers’ new suite of weight loss products including the virtual clinic. 

As a large employer with 67,000 employees, the clinical laboratory company gets pitched by GLP-1 virtual care companies on a regular basis and WeightWatchers was one of the few that didn't just push prescriptions, said Dr. Brian Caveney, Labcorp chief medical and scientific officer.

The company previously offered WeightWatchers's traditional program so WeightWatchers's knowledge of Labcorp’s pharmacy benefit manager and health plan was a huge plus, Caveney said.

The high cost of GLP-1s

Most GLP-1s are priced around $1,000 per month before insurance coverage, according to an analysis from KFF. 

Cost is the main reason why some insurers and self-insured employers are hesitant to cover the drugs. Last week, Blue Cross Blue Shield of Michigan said it will drop coverage of GLP-1 obesity drugs in fully insured large group commercial plans.

An analysis presented Thursday by the Massachusetts Health Policy Commission showed how the drugs are affecting commercial insurer spending. GLP-1 spending in the state was $270 million in 2023, more than doubling 2022’s $125 million mark. The trends are driving up employers' cost on healthcare and causing them to panic, experts say.

“[Employers] want to cover it, but they don't know how,” Deacon said. “So these point solutions are stepping up and saying, ‘We can help you manage that because we do the things that you need to do to make this is successful long-term investment.’”

The 1199 Service Employees International Union's Benefit and Pension Funds, which provides benefits to nearly 450,000 healthcare service employees and their families, uses WeightWatchers to help their members navigate GLP-1s. More than 12,000 of its members have taken a GLP-1, which the fund covers at no cost. 

The funds represent many members who have diabetes, hypertension and obesity, which provides an incentive to cover the medications, said Donna Rey, executive director of the funds. She said she doesn’t think WeightWatchers’ philosophy has changed but is in line with how people are rethinking obesity.  

“I don't see them as shifting but expanding to accommodate those who would go down this path,” Rey said. "And everybody isn't going to go down this path. Their core values haven't shifted. There's a trust factor there."