Taipei, Taiwan – Ozempic has become a lucrative business in China.

In the past year, Danish pharmaceutical giant Novo Nordisk doubled its sales of the diabetes medication in China to nearly $700 million, accounting for 5 percent of Ozempic’s global sales.

Ozempic was approved for diabetes treatment in China in 2021, but its anti-obesity component, semaglutide, has driven high demand for what many in China call the “internet celebrity weight-loss drug.”

Chinese influencers and vloggers have been promoting Ozempic on social media platforms. These social platforms are also the origin of various “beauty challenges” where mostly young women display their slim figures.

“In China, thinness is the beauty standard for women, and some are willing to pursue this ideal even at the expense of their health,” Pan Wang, a senior lecturer in Chinese and Asian studies at Australia’s University of New South Wales, shared with Al Jazeera.

For Pan Wang, the escalating demand for Ozempic is expected. “Many people in China are now willing to try all sorts of methods and supplements to lose weight,” she added.

Those seeking drastic weight-loss measures extend beyond young, beauty-conscious women. China holds the highest number of overweight or obese individuals, with nearly half the population affected.

Rising obesity rates paired with stringent beauty ideals make the Chinese market highly attractive for weight-loss drug manufacturers, according to Pan Wang.

“There’s a significant opportunity for profit,” she noted.

Pharmaceutical companies are rapidly responding to this demand.

Novo Nordisk has applied to China’s drug regulators to broaden Ozempic's usage amid speculations it aims for weight-loss specific marketing approval. The company also expects its weight-loss drug Wegovy to receive approval in China this year.

In May, Eli Lilly, based in Indianapolis, secured approval from the Chinese regulators for its Ozempic competitor, Tirzepatide.

Another Chinese company, Hangzhou Jiuyuan Gene Engineering, owned by pharmaceutical giant Huadong Medicine, has applied for approval to sell the first homegrown Ozempic competitor earlier this year.

Despite these advancements, the demand for weight-loss drugs is outstripping supply, with Eli Lilly forecasting continued high demand into 2024.

On platforms like Taobao, Ozempic’s price can go up to 1,000 yuan ($138), double the cost at public hospitals.

While established companies collaborate with Chinese health authorities to boost supply, counterfeit versions of semaglutide are proliferating online.

“The grey market for weight-loss drugs is thriving in China,” observed Allan Von Mehren, chief analyst and China economist at Danske Bank.

“There is substantial growth potential for weight-loss drugs in China,” Von Mehren added, highlighting that supplier competition won’t pose a major hurdle in the coming years. The challenge now lies in production capacity.

“Those who invest in capacity and dominate this space will likely capture the biggest market share,” he stated.

Von Mehren emphasized that state intervention and regulation will play crucial roles in determining market players. “Until now, the market has been unregulated like the Wild West,” he remarked.

Recently, the Chinese government has begun to regulate the market more strictly. Last February, thousands of posts about Ozempic-related weight-loss experiences were removed from Xiaohongshu.

In March, crackdown on the development and sale of unregulated semaglutide products resulted in several arrests and convictions. Last month, six people were prosecuted for vending weight-loss chocolates containing banned substances after a child required hospitalization from consuming them.

“With the approval of new drugs, we will likely see increased regulatory involvement by Chinese authorities,” Von Mehren said.

While Western products currently dominate China’s weight-loss drug market, more government intervention could shift the balance.

Novo Nordisk is already embroiled in a patent dispute with Huadong Medicine, which is eager to launch a Chinese competitor to Ozempic. In 2021, Huadong filed to invalidate Novo Nordisk’s semaglutide patent in China, which was set to last until 2026. Although the patent was initially invalidated, Novo Nordisk has appealed, and a final decision is pending.

“If the courts rule the patent invalid, it could significantly increase the supply of weight-loss drugs in China, enabling more Chinese companies to release Ozempic alternatives,” Von Mehren said.

However, foreign firms have long been skeptical of the preferential treatment local Chinese companies might receive.

At the World Economic Forum in Davos, Chinese Premier Li Qiang reassured that “China is open for business” and sees potential for foreign investments.

“The real test will be if they balance the playfield for both local and foreign companies,” Von Mehren concluded.