Sequence is a subscription service that offers telemedicine visits to physicians who can prescribe the medication. WeightWatchers, which has long promised to help customers lose weight through diet tracking and lifestyle changes, is transitioning to offering customers a medical approach to weight loss as well.
“This is the biggest innovation in our industry today,” said Sima Sistani, WW Chief Executive Officer, of the new drugs. “There’s real excitement about the health outcomes of these drugs.” Ms. Sistani, who has been CEO since 2022, noted that there are also concerns that people taking these drugs need support to change their diet and exercise.
Sequence, whose corporate name is Weekend Health Inc., was founded in 2021 and has approximately 24,000 members as of February. WW says it is paying a net purchase price of $106 million and the deal is expected to close in the second quarter of 2023.
WW plans to promote Sequence’s telehealth services to WeightWatchers members. Gary Foster, WW Chief Scientific Officer, says that WeightWatchers plans to develop programs geared toward people using weight-loss drugs that would include an emphasis on strength training and eating high-protein foods because people, if they lose weight, often lose important muscle mass .
Sequence members pay $99 per month for services that include telemedicine appointments with doctors who can prescribe Ozempic, Wegovy, Mounjaro, and other weight-loss drugs. Sequence’s program includes a weight loss tracking app and meetings with nutritionists and fitness trainers. Potential subscribers first take a short quiz asking about their height, weight and specific medical conditions.
Medications like Wegovy and Ozempic work like GLP-1, a naturally occurring hormone that stimulates insulin production and slows stomach emptying, making users feel full for longer. People with a body mass index of 30 or higher who took semaglutide, the active ingredient in Wegovy and Ozempic, lost an average of about 15% of their body weight weekly after 17 months, according to a study published in 2021 in the New England Journal of Medicine .
The drugs have recently been the subject of online celebrity testimonials and have gained popularity, leading to drug shortages.
Wegovy is approved by the Food and Drug Administration to treat obesity, and Ozempic is approved for diabetes. The FDA approval for Wegovy states that the drug is for people with a BMI of 30 or more, or a BMI of 27 or more plus at least one weight-related condition, such as high blood pressure, high cholesterol, or type 2 diabetes.
Some digital health companies have come under fire for promoting the drugs as a quick weight-loss approach for people who aren’t obese and don’t have diabetes. The drugs can cause side effects such as nausea and vomiting.
WW sees the new drugs for obesity and diabetes as a complement to its existing offerings, including its cornerstone meal plan, where users track what they eat and drink and aim to stay within a certain number of daily “points.”
“We have no interest in prescribing drugs to those who are trying to lose 10 pounds for a reunion,” said Dr. Foster. He says that WeightWatchers members lose an average of 5 to 6 percent of their body weight in six months.
WW said it would pay $106 million in a combination of cash and stock for the deal: $65 million in cash and $35 million in newly issued WW common stock at closing and $16 million $16 million in cash on the first anniversary and $16 million in cash on the second anniversary. WW will assume $26 million of Sequence’s cash position.
The Sequence deal comes after several turbulent years at the company. In 2018, WeightWatchers shifted from its narrow focus on weight loss – changing its name to WW and largely ending the use of the word “diet” – in favor of a broader wellness approach. The company launched and later scaled back several initiatives, including personalized meal plans, which many members found confusing. Membership—and the company’s share price—fell. WeightWatchers had 3.8 million members as of October 2022, up from 4.5 million in October 2021.
When Ms. Sistani, who came from the tech industry and was a founder of the social networking app Houseparty, joined the company, she drew on the company’s weight-loss mission.
“We’ve started welcoming back WeightWatchers because I think it’s important not to shy away from talking about weight loss being important for health,” she said.
Write to Andrea Petersen at [email protected]
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