Some More 2025 Predictions

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The More Predictions The Better

On the last episode of Out-Of-Pocket, I gave some predictions and spilled my heart out to all of you while I was 3 hard eggnogs deep. 

I asked you all to send me some of your predictions, and like a good risk pool I cherry picked some of my favorites below.

• The GLP-1 Rebrand To Addiction
• The end of ACA subsidies
• The FDA approves more drugs than ever
• AI Scribe Commoditization
• Amazon will materially restructure its healthcare offerings

Memes and commentary from me.

The GLP-1 Rebrand To Addiction

> From Sangye Tsakorshika

“GLP1 drugs get rebranded as addiction killers. Eli Lilly recently announced plans to begin testing their obesity drugs for addiction treatment in 2025. The company's CEO describes this emerging class of therapies as "anti-hedonic"—where "hedonic" refers to sensations of pleasure, and "anti-" signifies opposition. In essence, these drugs aim to counteract the pleasure derived from addictive behaviors, targeting the reward pathways that fuel cravings.

This bold repositioning signals a shift: GLP-1s are no longer just metabolic regulators but potential game-changers in the fight against addiction.

Here are my predictions for 2025 

• GLP-1 Trials Start Tackling Addiction—and Succeed
  By 2025, clinical trials testing GLP-1 drugs for addiction will deliver clear, positive results. Whether it’s alcohol, nicotine, or even opioids, the data will show significant drops in cravings and relapse rates. This success will position GLP-1s as a game-changing tool for addiction recovery, offering a biological reset for the brain’s reward system. Addiction specialists will increasingly integrate these drugs into treatment programs, blending them with therapy and behavioral interventions. (some early reports of addiction curbing may provide some insight into these trials) 

• GLP-1s Become the Go-To Drug in Elite Addiction Centers
  Just like we’ve seen with Ozempic and weight loss, GLP-1 drugs for addiction treatment will first become the hot new offering at elite rehab centers in places like Beverly Hills and Malibu. Wealthy patients will be the early adopters, accessing these treatments well before they reach public programs or lower-income addiction clinics. This disparity could fuel debate over equity in addiction care—much like the backlash around GLP-1 access for obesity—but it will also drive awareness and demand.
• Addiction-Specific GLP-1 Formulations Hit the Market
  Pharma isn’t going to sit this one out. As the addiction narrative builds, companies will race to develop GLP-1 versions tailored for specific addictions—like alcohol use disorder or smoking cessation. These new formulations might skip the appetite suppression seen with obesity treatments, instead dialing in on craving control. Add outcomes-based pricing (where drugmakers only get paid if patients improve), and you’ve got a win-win pitch for insurers looking for cost-effective solutions.”

[NK Note: Nothing more American than consuming drugs to stop addictions. It’s interesting to me that GLP-1s seem to be working on addiction at the same time that we’re starting to see the rise of new addiction types (sports gambling, stock market trading, marijuana, etc). I can’t imagine insurance is going to be thrilled to cover these medications for all addictions, so it’ll be interesting to see how coverage pans out.

I do wonder though how you deal with metabolic changes if patients with addiction don’t want to lose weight. Maybe dose titration/microdosing actually plays a role here, something our favorite TMI influencer Bryan Johnson is already testing out.

Anti-hedonic is genius branding btw. It’s also how I refer to this newsletter.]

The end of ACA subsidies

> From Sathya Hari

“The Biden administration significantly expanded ACA premium tax credits (PTCs) through the American Rescue Plan Act and Inflation Reduction Act, making coverage much more affordable—nearly 50% of enrollees pay less than $10/month. This spurred record enrollment and stabilized ACA risk pools. However, these enhanced subsidies are set to expire at the end of 2025. While proposals exist to extend or make them permanent, I believe they’ll likely lapse. Preserving the 2017 tax cuts and funding them seems to be a priority for the new administration, and maintaining PTCs would cost $387 billion over the next decade. States like Florida and Texas—non-Medicaid expansion states—benefit most from these subsidies, which could deter Republican lawmakers from letting them expire. Still, the incoming administration’s focus on reshaping the ACA might conflict with expanding PTCs.

If subsidies end, healthier enrollees might exit ACA markets, driving up premiums and causing potential disruptions in ICHRA markets—a Trump-era innovation. It will be interesting to see if regulators propose targeted solutions to stabilize ICHRAs, such as expanding their scope to include non-qualified health plans. Beyond the ICHRA context, I’m curious whether the age restriction on catastrophic plans might be lifted or if there will be a push for non-ACA-compliant options like indemnity plans or healthshares. However, these changes may require amending the ACA—a step I don’t expect to see taken by the end of next year.”

[NK note: The only thing more predictable than getting the runs after a trip to Mexico City is the Republican party looking for new ways to mess with the Affordable Care Act. The risk pools are already pretty tenuous, so allowing “skinny” health insurance plans for healthy people would probably cause a full blown death spiral.

I guess in general I just don’t understand what the Republican’s “Theory of Change” is for healthcare, and maybe some readers can better explain it to me. If it’s having a more competitive marketplace, it feels like strengthening the exchanges would help with that?]

The FDA approves more drugs than ever

> From Adu Subramanian

“The FDA will approve more drugs in the 4 years than ever before due to increased flexibility in trial design, especially in rare diseases. While many seem to think the disruptive impact of a new administration will lead to increased scrutiny on pharma, I think they'll choose to regulate food and trials for large diseases more than anything else. 

The FDA goes in waves and I think we're in a wave of increased flexibility. Past examples are Thalidimode crisis -> FDA given more power -> 1970s researchers criticizing the increased power -> accelerated approval in the 1980s -> Criticisms in the 90s for the PDUFA and succumbing to pharma bias.  I think the bias is toward letting the market decide on the best drugs: If patients want a drug, insurance will reimburse, and doctors are willing to prescribe it: maybe it should be approved?

Vivek Ramaswamy is a former Biotech CEO, Marty Makary has advocated for new modalities (microbiome, changing ovarian cancer protocols), and Peter Marks is still at the helm of CBER. I think the FDA will try and create new programs to accelerate drug approvals. Any pressure will be on pricing (Makary literally wrote "the Price we way"), potentially vaccines and drugs for large markets (GLP1s). The pathway will open for novel modalities (digital therapeutics, psychedelics, etc)

Other predictions:

• GLP-1 remains the lead mechanism for obesity. "The king stay the king "- D’angelo Barksdale, tragic poet -> Lots of hype about new mechanisms for weight loss, but the majority of patients will start with tirzepatide. Considering Sema goes up for negotiation in 2028.......and the next unlock is oral molecule for GLP1s and longer dosing, not more weight loss. Humira and Keytruda were category defining mechanisms which spurred lots of other mechanisms which never took over.
• A lot of tech companies become "Features". I’m seeing this with the biggest tech company of all: Perplexity, I don’t use it much any, GPT search is good enough. But this won’t happen in healthcare because of the regulatory moat. I don’t think we need healthcare specific GPT models, we need healthcare specific companies.
• Early phase chinese biotech acquisitions accelerate as companies prepare for potentially more regulation from new admin while trying to take advantage of fast to clinic opportunities.”

[NK note: I’m going to be honest with you, I have 0 idea what’s going to happen on the drug approvals side. Everyone in this healthcare administration seems to have different opinions on pharma.

‍Lots of interesting tensions to think about:

• The FDA typically looks at safety and efficacy for drugs. Will a big “pricing guy” at the head of the FDA mean a shift to tying approvals to pricing?
• Some of the administration believes we should be doing more to try non-pharmacological options first while the other group thinks drugs should be in people’s hands faster.
• The US wants to remain the pharma innovation center of the world but also people in this country really don’t like pharma. High prices is part of what allows for that + making it easier to bring drugs to market can elicit a lot of public skepticism.
• If Chinese drugs become a bigger part of the story, is that going to be an issue with US-China security concerns?

This crew is going to have the funniest meetings ever though, I really hope they make a reality TV show out of it]

Quick Interlude - Headhunting

We just played another candidate at a company (Head of Product). Things seem to be working on our mini headhunting product.

If you’re hiring and want to see who in the OOP universe (newsletter, etc.) is a match, come chat with us. We tend to do particularly well with ops, design, product, chief of staff, and BD.

AI Scribe Commoditization

> From Alex Mullin

“I wanted to toss a 2025 prediction into the mix.

• I predict that in 2025, we'll see the 'peak' of gen-AI scribe tools, as well as the beginnings of their commoditization. 
• There are a few big players in this space (e.g. Augmedix in earlier days & Ambiance more recently) with a long tail of competitors (Nabla, Suki, DeepScribe, as well as clinics and health systems using proprietary technology). All in all, there are a ton of options to enable ambient dictation and AI-powered scribing / note generation. 
• While a few players have really had a stronghold on the market, I think we're turning a bit of a corner, tech-wise. Between open source LLMs and advancements in gen-AI more broadly, I'm predicting that these tools will become increasingly commoditized. Players that have historically specialized exclusively in scribing will have to find other ways to increasingly drive value, or risk customers finding or building more in-house, customizable solutions.

• I'm guessing this will be the start of a long transition period, since huge health systems can't exactly switch out software overnight. That said, for startups or smaller practices with the engineering resources, they may start to see gen-AI powered dictation and transcription as something which can be done in-house rather than via a pricey, external vendor. 
• Sometimes cost cutting can really impact care in a negative way, but I'd argue that this thread of cutting out these vendors will either vastly improve how transcription works. Either companies will use better, custom models and proprietary software, or mega-vendors will be forced to really improve and expand on the services they offer to justify their presence on company's P&L.”
  

[NK note: While I think this is true in lots of the AI back-office companies, I think scribing is interesting because it’s one of the few areas you see real user demands from physicians. While the tech itself might get commoditized, I can see differentiation on user experience actually mattering here. And that’s not just the interface, that’s everything from how easy it is to push and pull data to EMRs, surface more info for the note without overloading users, etc.

‍To be honest, I’ll never be bullish on hospital customers or EHRs building their own software in-house that is somehow better. No matter how easy it is to build on top of new models, they just do not have the muscle to deliver a good user experience. Why do you think there are so many post-its on computers in the hospital?]

Amazon will materially restructure its healthcare offerings

> From Oliver Kharraz

“Tech giants have had a notable lack of traction in healthcare, and Amazon, Apple, Google, and Microsoft have all learned firsthand that this space is not easy to disrupt from the outside in. While most have retrenched, Amazon has persisted. Despite various pivots, it has not yet been able to show traction in this space. 

For a company that prizes efficiency, it is untenable to continue to carry hundreds of millions in losses. 2025 will be the year that they determine that they don’t have the margins to make healthcare work, and managing healthcare providers is a very different business than managing logistics. I am watching for a pivot that prioritizes pharmacy—which is more aligned with their core competencies and is more scalable—and divests other care services.”

[NK note: 1.5 years ago when this acquisition happened, I wrote that Amazon could use this as a beachhead to get into more low margin commodity services like labs, durable medical equipment, etc. That hasn’t happened yet, but they’ve done a few interesting things at the edges like give One Medical membership discounts to Prime members and launch their own direct-to-consumer telemedicine + pharmacy service which is also effectively a commodity. 

Amazon pharmacy could be one of the bigger beneficiaries of this next administration though. If the PBM scrutiny continues and the PBMs are forced to divest the mail-order pharmacies they own, the Amazon pharmacy can take a lot of customers. Plus if HSA expansion really does become a thing, Amazon already has eligible items tagged on its marketplace.]

Parting Thoughts

I hope you’re all having a very restful end of the year and honestly hoping the open rates for this newsletter are very low.

It’s been a long and pretty tough year for healthcare in 2024, but I can feel that 2025 is going to have chaotic energy. This can be a good or bad thing, but I think people really want to shake things up and next year they’ll feel like they have more permission to do so.

Here’s to hoping for new energy to take on the Gordian Knot of US healthcare in 2025.

Thinkboi out,

Nikhil aka. “20-25 vision”

Twitter: ​@nikillinit​

IG: ​@outofpockethealth​

Other posts: ​outofpocket.health/posts​

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