The hottest area among healthcare investors right now revolves around advancements being made in weight loss. Known as glucagon-like peptide-1 (GLP-1) receptor agonists, blockbuster drugs such as Ozempic, Wegovy, Mounjaro, Zepbound, and others are completely redefining how care is provided to patients with diabetes or in need of weight management.

While Danish-based pharmaceutical company Novo Nordisk (NYSE: NVO) leads the GLP-1 market (thanks in large part to enthusiasm for its pioneering Ozempic drug), its chief rival Eli Lilly (NYSE: LLY) is quickly gaining steam thanks to surging demand for its Mounjaro and Zepbound formulations.

Here are some big moves Lilly is making to strengthen its position in the weight loss market. Knowing how Lilly is laying the groundwork for long-term sustained growth can help investors determine whether the stock is a good buy at the moment.

Although demand for GLP-1 treatments is soaring, matching supply and demand has been daunting. While this could be considered a good problem to have, companies need to address and fix such issues. Operating from a position where one can't keep up with supply opens the door to competitive disruption.

Back in April, Lilly acquired a manufacturing facility from Nexus Pharmaceuticals. This deal was a direct response to rising demand for Mounjaro and Zepbound, and investors were encouraged by Lilly's efforts to scale its infrastructure. Earlier this month Lilly doubled down on its manufacturing investment campaign, as the company announced that it's pouring in another $3 billion for further expansion of the Nexus facility. Lilly's focus on augmenting manufacturing capabilities is a good sign and will lead to higher production of its medicines.

But this is just one noteworthy announcement the company has made lately.

In addition to Novo Nordisk, Lilly also faces competition from telemedicine company Hims & Hers Health (NYSE: HIMS). While Hims & Hers does not develop its own medications, the company does maintain compounding operations for drugs deemed to be in such high demand that the government allows other companies to help fill the demand. Hims & Hers Health essentially offers patients generic versions of these highly popular drugs, often sold at a much more reasonable price point.

Over the last year, Hims & Hers has managed to make a splash in the weight loss realm by selling compounded semaglutide. Semaglutide is the main active ingredient in Novo Nordisk's Ozempic and Wegovy. It is important to note that compounded medications are not approved by the Food and Drug Administration (FDA) but do meet certain state requirements and safety standards.