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Noom cuts staff to focus on fast-growing GLP-1 products
Metabolic health startup Noom is laying off part of its staff as it focuses its workforce on "the most critical areas of the business" — including weight loss and diabetes drugs, the company confirmed to CNBC on Monday.
Noom offers a range of behavioral and medically-assisted weight loss programs. Members of Noom Med can access several of the popular class of weight loss drugs known as GLP-1s, including Novo Nordisk's Ozempic and Wegovy. And in September, Noom announced it would also offer compounded semaglutide, the same active ingredient in Novo Nordisk's branded medications, through a new program called GLP-1(RX).
The company said the recent layoffs were the result of a revenue mix shift toward its fast-growing GLP-1 offerings like GLP-1(RX). Noom is investing heavily in that business, it added.
"In an effort to build a more efficient business centered around the needs of our customers, we made the difficult decision to reduce a portion of our workforce," a Noom spokesperson told CNBC in a statement. "With these changes, the company will be better positioned to deliver world-class products, technology, and coaching to more people looking to lead healthier lives."
Noom did not confirm the number of employees affected by the layoffs.
Endpoints News first reported the cuts.
Compounded GLP-1 medications are typically much cheaper than their branded counterparts, as Wegovy and Ozempic both cost roughly $1,000 per month before insurance. Noom's GLP-1(RX) costs participants $149 for their first month, and $279 for the following months as the dose of their medication increases.
The compounded drugs can be produced as custom-made alternatives to the brand drugs, as well as when brand-name treatments are in shortage. In addition to Noom, several digital health companies like Hims & Hers, Ro and Sesame have been offering compounded GLP-1 medications as consumers navigate spiking demand and spotty insurance coverage.
Noom's layoffs suggest the company is placing even more emphasis on anti-obesity medications, which some analysts estimate could grow into a $100 billion industry by the end of the decade.
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