Weight-loss tied stocks jumped following the update with rival Eli Lilly & Co. surging 15% to a record high. A positive outlook in Lilly’s earnings report also helped fuel the climb. Viking Therapeutics Inc., a drug developer working on a treatment similar to Novo’s Wegovy, jumped 12%. And WW International Inc. — better known as Weight Watchers — which bought a telemedicine firm that prescribes obesity medications earlier this year, soared 13%.  

Novo’s Wegovy showed a 20% reduction in heart issues compared to those getting a placebo in a closely watched study. The results cheered Wall Street bulls who called it a best-case scenario. Analysts saw the benefit extending the market for Wegovy as well as Lilly’s Mounjaro and possibly removing an obstacle in insurance reimbursement. 

“These medicines were only weight loss drugs, but now they are much more than that, and we think payers will likely have to provide access to these medicines at this point,” Mohit Bansal, a Wells Fargo analyst wrote in a note.

Morgan Stanley analysts project the global obesity market will reach $77 billion in 2030; they had previously estimated $54 billion.

Truist analyst Joon Lee called the update a “huge win” for the class of drugs Wegovy belongs to with “major positive implications to others developing next-gen weight loss drugs.”

Investors rewarding weight-loss stocks have helped Lilly cement its place as the world’s largest health-care company and made it one of the top 10 most valuable firms in the world. Tuesday’s climb added more than $60 billion to the Indianapolis-based company’s market value. Sales of Lilly’s Mounjaro — a diabetes drug that’s expected to be approved for obesity soon — hit nearly $1 billion in the last quarter.

Novo traded at fresh highs as the Danish pharmaceutical company gained ground on the only European megacap that is larger than it. 

Makers of syringes for the pharmaceutical industry, Stevanato Group SpA and West Pharmaceutical Services Inc., also gained  — rising 9.0% and 5.6% respectively.