Weight loss drugs have drawn investor interest and shaken up other sectors in the past year or so. Novo Nordisk and Eli Lilly were two early winners of this trend, as their drugs dominate the weight loss drug market. Yuri Khodjamirian, fund manager at Tema ETFs, said both companies are a “very powerful duopoly.” “But there’s obviously going to be room ins such a big market. The estimates currently are about $130 billion from Goldman Sachs. We think it’s going to be multiples of that,” he told CNBC Pro Talks last week. Khodjamirian believes there’s room for at least three players in this space. “I think the market is big enough to sustain three to four players, even at the market caps that are out there right now, but the market’s trying to figure out who that third or fourth player is, and a big breakthrough could be oral GLP-1s,” he said. He was referring to GLP-1, a class of weight loss drugs that was originally developed as a treatment for diabetes. GLP-1 is a hormone released in the gut that stimulates insulin secretion, slows the emptying of the stomach and communicates to the brain a feeling of satisfaction. Stocks to watch Khodjamirian named Amgen , which is developing an injectable drug and other products for obesity. He also pointed out some biotech names with potential but that investors have to be careful about. One of them is Carmot , which was acquired by pharmaceutical firm Roche last year, he noted. He also named smaller biotech firms such as Zealand Pharma and Viking Therapeutics . “These companies are early biotechs that are developing data. They’re a lot more risky than the bigger ones who already have drugs on the market,” Khodjamirian said. “And therefore, you have to just be very careful with making investments in such companies. So a diversified portfolio is probably the best way to go,” he said. Tema ETFs offers actively managed exchange-traded funds, with a focus on health care and life sciences. Khodjamirian is also the chief investment officer of Tema ETFs and manages its Monopolies & Oligopolies ETF , which looks to provide investors with long-term growth through companies that operate in monopolistic industry structures. Khodjamirian highlighted three ETFs his firm manages that are in the health-care industry: the Tema GLP-1, Obesity & Cardiometabolic ETF; the Tema Oncology ETF; and the Tema Neuroscience and Mental Health ETF. He said there’s a “valuation opportunity” in biotech stocks at the moment, but warned of risks. “Smaller companies in the biotech space are difficult to pick. You have to really know what you’re doing, and … in most of our biotech portfolios, we have 50 stocks, we don’t own more than 1%, 2% in some of these companies because of these risks, they could go to zero,” he said. However, there are “a lot” of innovations happening in biotech, and “loads of them” are trading below the value of the cash on their balance sheets, Khodjamirian said. “So there’s a valuation opportunity out there,” he said.