Surging demand for weight loss and diabetes drugs leaves the pharmaceutical sector at risk from a "bubble effect" as profitability soars, new research suggests.

Demand for the likes of Wegovy and Zepbound has driven research and development returns to their highest level in years, but a report published by Deloitte on Monday suggests this is masking pressure facing the rest of the sector.

Pharmaceutical R&D returns for the world's top 20 pharma companies have improved for a third consecutive year to 7%, thanks almost entirely to a handful of high-forecast assets such as glucagon-like peptide receptor agonists, or GLP-1s.

The report found that, for the first time in 16 years, oncology has been surpassed as the largest contributor to late-stage pipeline value by obesity treatments.

This, according to Deloitte, increases companies' exposure to therapeutic-area-specific shocks.

"It is a bubble, because so much is concentrated," Life Sciences and Healthcare Partner at Deloitte Hanno Ronte, told CNBC's…