Shares of LifeMD were rising sharply Wednesday after the provider of virtual primary care services announced its partnership with Medifast, a renowned health and wellness company known for its lifestyle service Optavia. Together, they will present a "transformative weight management solution."
Providing Access to a Comprehensive Weight Management Program
As part of the agreement, Medifast will leverage LifeMD's virtual care technology platform to grant Optavia clients access to a comprehensive weight management program. This program includes GLP-1 medications, which are drugs designed to mimic natural hormones that impact the body's feelings of fullness. In addition, LifeMD will offer its patients an independent Optavia coach and other invaluable lifestyle support services.
A Strategic Investment
Medifast has made a strategic investment of $20 million into LifeMD. This includes $10 million that will be allocated to support the collaboration and enhance the platform, operations, and infrastructure. Additionally, Medifast has purchased $10 million worth of LifeMD's common stock.
"This is a pivotal moment for our business as we take the next step in an aggressive transformation to drive growth in this evolving health and wellness landscape," said Dan Chard, Chairman and CEO of Medifast. "Millions of people are seeking a solution that I believe we are uniquely positioned to provide."
Positive Market Response
LifeMD stock experienced a 12% increase in premarket trading following the announcement, while Medifast saw a slight decline of 0.5%. To further discuss the exciting collaboration, both companies will be hosting a conference call at 10 a.m. Eastern.
Shaping the Weight-Loss Drug Industry
This agreement comes amidst a flurry of discussions surrounding weight-loss drugs, which have rapidly gained popularity. As a result, analysts predict that drug giants, such as Novo Nordisk and Eli Lilly, will have the opportunity to secure billions of dollars in revenue.