Healthcare ETFs are quietly feasting on the gains from Wall Street’s latest obsession – the $150 billion obesity-drug boom. As Eli Lilly And Co (NYSE:LLY), Novo Nordisk A/S (NYSE:NVO), and Pfizer Inc (NYSE:PFE) jostle for dominance in the fast-growing GLP-1 market, investors pile into ETFs that offer diversified and far less calorie-dense ways to play the trend.
- Elli Lily stock is up almost 5% on Thursday. Track its prices, live.
The Health Care Select Sector SPDR Fund (NYSE:XLV) is one of the largest and most liquid U.S. healthcare ETFs, with Eli Lilly as its top holding. Lilly alone constitutes over 12% of the fund, which also includes heavyweights like Johnson & Johnson (NYSE:JNJ), AbbVie Inc (NYSE:ABBV) and Merck & Co Inc (NYSE:MRK), making XLV a go-to for investors seeking broad yet concentrated exposure to the pharma surge.
The iShares U.S. Pharmaceuticals ETF (NYSE:IHE) offers an even more targeted play, with roughly 20 of America's biggest drugmakers, including Lilly and Pfizer. The fund has gained traction this week as investors digest Lilly's blowout earnings and Novo's audacious takeover bid for Metsera. On Thursday, the fund was up almost 2%.
The VanEck Pharmaceutical ETF (NASDAQ:PPH) adds a global flavor to the mix, combining U.S. and European pharma names like Novo Nordisk alongside Lilly and Pfizer to give it a front-row seat to the obesity drug arms race.
For investors who prefer the theme-first approach, the Roundhill GLP-1 & Weight Loss ETF (NASDAQ:OZEM) has emerged as a pure-play bet on the anti-obesity revolution. The fund focuses exclusively on companies leading the charge of this megatrend in weight loss and diabetes treatment, from established GLP-1 producers to emerging biotech developers.
Eli Lilly Leads, Rivals Fight
Setting the tone for the sector were third-quarter results from Eli Lilly, whose adjusted earnings of $7.02 per share topped estimates and raised its full-year profit forecast to as high as $23.70.
But across the Atlantic, Novo Nordisk is making headlines of its own, launching a $6.5 billion counterbid for U.S. biotech Metsera, edging out Pfizer’s earlier deal. Metsera is developing a few experimental weight-loss treatments, including a shot that can be taken less frequently than Novo Nordisk's Wegov, making the deal attractive to the giant.
Pfizer, which is still regaining its footing after the pandemic vaccine windfall faded, called Novo’s move “reckless” and anticompetitive, but the fight underscores how high the stakes have become in the GLP-1 gold rush.
With Lilly tightening its lead, Novo flexing its balance sheet, and Pfizer trying to claw back relevance, the obesity-drug race is reshaping the global pharma landscape-and ETFs are emerging as the easiest way to stay invested in the frenzy.
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