Monday, April 15, 2013

America's Hidden Obesity Epidemic

The United States is the fattest country in the world -- and I'm not talking about our wallets, folks! According to the Centers for Disease Control and Prevention, a disheartening 35.7% of the population is considered obese. That's considerably higher than the next closest countries, Mexico, New Zealand, and Australia, which have obesity rates ranging between 25% and 30%.

A huge, but largely preventable, problem
The sad part about obesity is that it's preventable more often than not. Medical costs associated with obesity were estimated by the CDC in 2008 at $147 billion annually, with obese people, on average, registering a cost premium of $1,429 as compared to someone of average weight. Obesity also brings on higher risks of hypertension, heart disease, stroke, Type 2 diabetes, and certain types of cancers.

And it isn't just that being overweight has been shown to be poor for your long-term health; it's that society has surrounded itself in a cocoon that frowns upon obesity from the magazines we read, to the commercials we watch, and the movies we see on the big screen. The push toward creating a healthier lifestyle has begun in our homes with the way we eat, exercise, and live our lives. Unfortunately, as the following U.S. obesity map shows, it's not been nearly enough.


Source: Centers for Disease Control and Prevention. 

Obesity has also been a big research driver in the pharmaceutical sector as well where 13 years went by since the last chronic weight management drug was approved. That changed last year with the approval by the Food and Drug Administration of VIVUS' (NASDAQ: VVUS  ) Qsymia and Arena Pharmaceuticals'  (NASDAQ: ARNA  ) Belviq for the treatment of chronic weight management. Neither drug is a miracle cure, but an average weight loss of around 6% to 8% can be expected on either pill over a year's time based on late-stage clinical trial results. 

America's hidden obesity epidemic
However, an even scarier obesity trend is likely rearing its head in another part of your household and you aren't even aware of it. Close to one half of all families are oblivious to its existence, but contribute to it anyway. What I'm talking about is the rampant pet obesity epidemic in this country!

According to the latest study by the Association for Pet Obesity Prevention conducted in 2012 and released last month, a staggering 55% of household pets (52% of dogs and 58% of cats) are considered either overweight or obese. Furthermore, in APOP's study, 45% of pet owners incorrectly identified their pet as being "normal weight" when the veterinarian identified the pet as either "overweight" or "obese." That equates to just shy of 80 million animals in this country that are suffering from the same types of ailments as humans: mainly hypertension, osteoarthritis, and an increased risk of diabetes and certain types of cancers solely because of their weight. 

Now, I have a confession to make -- I am the proud owner of an overweight Dachshund. I had no problem in recognizing that he was overweight, yet, as a member of the family, I had no qualms about giving him an extra treat when he was younger. Having now reached middle age for his breed, I'm beginning to notice what those extra pounds are doing to him from a health perspective; and it's not good. It's definitely difficult saying "no" to my dog, but I've managed to work off 17% of his previous body weight in the past year through smaller food portions and more rigorous exercise.

The point is that just as we saw with many cases of human obesity, pet obesity can be mitigated with proper diet, exercise, and a want by owners to change the quality of life for their pets. I'm making that move, but far too many owners are simply complacent in doing nothing.

Ignore this trend at your own risk
If you choose to do nothing, then you're playing right into the hands of pharmaceutical giants like Zoetis (NYSE: ZTS  ) , Merck (NYSE: MRK  ) , and IDEXX Laboratories (NASDAQ: IDXX  ) , which are counting on your indifference to drive their profits.

If you don't believe that pet obesity is an epidemic, all you need to do is look toward Zoetis' Slentrol, which is an anti-obesity pill approved by the Food and Drug Administration in early 2007 to treat dogs. That's right; a chronic weight management pill to treat our pets came more than five years before big pharma introduced a new anti-obesity pill for humans -- and yet, our pet obesity rate continues climb. In trials, Slentrol produced a mean weight loss of 11.8% in the 141 dogs tested, but it still requires the owner to stick to a dietary and exercise game plan to ensure the best chance of success. 

If your faithful feline or pup should ever develop diabetes from being overweight, chances are they could be prescribed Vetsulin, an FDA-approved insulin injection to treat diabetes mellitus made by Merck Animal Health and targeted at hyperglycemia. Two injections a day and close monitoring of your pet are required to provide successful glycemic balance using this drug.

IDEXX Labs is also counting on your overweight or obese pet to drive its small animal health products that range from in-home and veterinary office diagnostic and imaging tests, to software designed to optimize veterinarians' bottom lines. IDEXX's I-Vision Direct Capture system, for instance, could be called upon for its quick and crisp imaging capabilities to help diagnose osteoarthritis and other bone-related diseases in pets caused by being overweight. As obesity trends have risen so have IDEXX's sales, which are up by an average of 10.5% each year over the past decade.

How can we fix this?
The point here is simple -- we can choose to kill two birds with one stone by simply choosing to exercise with our pets. Instead of watching TV in the house, take your dog for a walk. Instead of playing video games, grab a toy for your feline friend and entertain them. The thing about health-consciousness is that it's incredibly contagious. Having your pet eating better and exercising more is likely to, in turn, get you eating better and exercising more as well. It's a vicious (but fantastic) cycle that will have you and your pet feeling better and living happier, healthier lives.

Another key takeaway is that, when push comes to shove, we will do just about anything to ensure the health of our pets, as they've crossed that barrier -- at least in America -- from being just a pet to becoming part of the family. This means that animal-focused pharmaceuticals like Zoetis, Merck, and IDEXX stand to benefit whether obesity trends continue to rise, and they could make for some of the smartest and safest investment on Wall Street.

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