KalshiEX LLC

August 31, 2023

SUBMITTED VIA CFTC PORTAL

Secretary of the Commission

Office of the Secretariat

U.S. Commodity Futures Trading Commission

Three Lafayette Centre

1155 21st Street, N.W.

Washington, D.C. 20581

Re: KalshiEX LLC – CFTC Regulation 40.2(a) Notification Regarding the Initial Listing

of the “Will <above> <count> weight loss drugs be prescribed by <date>?” Contract

Dear Sir or Madam,

Pursuant to Section 5c(c) of the Commodity Exchange Act and Section 40.2(a) of the regulations of the

Commodity Futures Trading Commission, KalshiEX LLC (Kalshi) hereby notifies the Commission that

it is self-certifying the Will <above> <count> weight loss drugs be prescribed by <date>? contract

(Contract). The Exchange intends to list the contract on a monthly basis. The Contract’s terms and

conditions (Appendix A) includes the following strike conditions:

● <month> (the target month)

● <count> (the target number of weight loss drugs prescribed)

● <above>

Along with this letter, Kalshi submits the following documents:

● A concise explanation and analysis of the Contract;

● Certification;

● Appendix A with the Contract’s Terms and Conditions;

● Confidential Appendices with further information; and

● A request for FOIA confidential treatment.

If you have any questions, please do not hesitate to contact me.

Sincerely,

Xavier Sottile

Head of Markets

KalshiEX LLC

xsottile@kalshi.com

KalshiEX LLC 
KalshiEX LLC

KalshiEX LLC

Official Product Name: Will <above> <count> weight loss drugs be prescribed by <date>?

Rulebook: WEIGHTDRUGS

Kalshi Contract Category: Health/Science

Weight loss drug prescriptions

August 31, 2023

CONCISE EXPLANATION AND ANALYSIS OF THE PRODUCT AND ITS 

COMPLIANCE WITH APPLICABLE PROVISIONS OF THE ACT, INCLUDING CORE 

PRINCIPLES AND THE COMMISSION'S REGULATIONS THEREUNDER 

Pursuant to Commission Rule 40.2(a)(3)(v), the following is a concise explanation and analysis 

of the product and its compliance with the Act, including the relevant Core Principles, and the 

Commission's regulations thereunder. 

I. Introduction 

The “Will <above> <count> weight loss drugs be prescribed by <date>?” Contract is a 

contract relating to the number of prescriptions for novel weight loss drugs. After careful 

analysis, Kalshi (hereafter referred to as “Exchange”) has determined that the Contract 

complies with its vetting framework. 

In 2021, the U.S. Food and Drug Administration began approving a small number of 

drugs that contain the molecules semaglutide and tirzepatide for treating obesity. These 

drugs were previously used to treat type II diabetes, a weight-related condition. Since 

then, they have been widely covered in the popular press and prescriptions have 

dramatically increased. 12

IQVIA, the Contract’s Source Agency, is a major data provider in the pharmaceutical 

industry. It is widely regarded as not just the industry standard, but the largest player–its 

success in the industry is described as having “no peer”. 3 They supply data regularly to 

the U.S. Food and Drug Administration; according to the Administration, “...FDA 

regularly utilizes multiple IQVIA data streams. IQVIA also provides data to other federal 

agencies including the Drug Enforcement Administration (DEA), and other agencies 

within the U.S. Department of Health and Human Services (HHS).” 

3 https://www.statnews.com/2023/07/25/drug-advertising-iqvia-health-data-ftc/

2 https://www.newyorker.com/magazine/2023/03/27/will-the-ozempic-era-change-how-we-think-about-being-fat-and

-being-thin

1 https://www.nytimes.com/2023/08/26/nyregion/ozempic-nyc-neighborhoods-diabetes.html

KalshiEX LLC 
KalshiEX LLC

Further information about the Contract, including an analysis of its risk mitigation and 

price basing utility, as well as additional considerations related to the Contract, is 

included in Confidential Appendices B, C, and D. 

Pursuant to Section 5c(c) of the Act and CFTC Regulations 40.2(a), the Exchange hereby 

certifies that the listing of the Contract complies with the Act and Commission 

regulations under the Act. 

General Contract Terms and Conditions: The Contract operates similar to other event 

contracts that the Exchange lists for trading. The minimum price fluctuation is $0.01 (one 

cent). Price bands will apply so that Contracts may only be listed at values of at least 

$0.01 and at most $0.99. Further, the Contract is sized with a one-dollar notional value 

and has a minimum price fluctuation of $0.01 to enable Members to match the size of the 

contracts purchased to their economic risks. The Exchange has further imposed position 

limits (defined as maximum loss exposure) of $25,000 USD on the Contract. As outlined 

in Rule 5.12 of the Rulebook, trading shall be available at all times outside of any 

maintenance windows, which will be announced in advance by the Exchange. Members 

will be charged fees in accordance with Rule 3.6 of the Rulebook. Fees are charged in 

such amounts as may be revised from time to time to be reflected on the Exchange’s 

Website. A new Source Agency can be added via a Part 40 amendment. All instructions 

on how to access the Underlying are non-binding and are provided for convenience only 

and are not part of the binding Terms and Conditions of the Contract. They may be 

clarified at any time. Furthermore, the Contract’s payout structure is characterized by the 

payment of an absolute amount to the holder of one side of the option and no payment to 

the counterparty. During the time that trading on the Contract is open, Members are able 

to adjust their positions and trade freely. After trading on the Contract has closed, the 

Expiration Value and Market Outcome are determined. The market is then settled by the 

Exchange, and the long position holders and short position holders are paid according to 

the Market Outcome. In this case, “long position holders” refers to Members who 

purchased the “Yes” side of the Contract and “short position holders” refers to Members 

who purchased the “No” side of the Contract. If the Market Outcome is “Yes,” meaning 

that weight loss drug prescriptions are above <count> in <month>, then the long position 

holders are paid an absolute amount proportional to the size of their position and the short 

position holders receive no payment. If the Market Outcome is “No,” then the short 

position holders are paid an absolute amount proportional to the size of their position and 

the long position holders receive no payment. Specification of the circumstances that 

would trigger a Market Outcome of “Yes” are included below in the section titled 

“Payout Criterion” in Appendix A. 

KalshiEX LLC 
KalshiEX LLC

CERTIFICATIONS PURSUANT TO SECTION 5c OF THE COMMODITY EXCHANGE 

ACT, 7 U.S.C. § 7A-2 AND COMMODITY FUTURES TRADING COMMISSION RULE 

40.2, 17 C.F.R. § 40.2 

Based on the above analysis, the Exchange certifies that: 

❏ The Contract complies with the Act and Commission regulations thereunder. 

❏ This submission (other than those appendices for which confidential treatment has been 

requested) has been concurrently posted on the Exchange’s website at 

https://kalshi.com/regulatory/filings . 

Should you have any questions concerning the above, please contact the exchange at 

ProductFilings@kalshi.com . 

______________________ 

By: Xavier Sottile 

Title: Head of Markets 

Date: August 31, 2023 

KalshiEX LLC 
KalshiEX LLC

Attachments: 

Appendix A - Contract Terms and Conditions 

Appendix B (Confidential) - Further Considerations 

Appendix C (Confidential) - Source Agency 

Appendix D (Confidential) - Compliance with Core Principles 

Appendix E (Confidential) - Agreement with IQVIA 

KalshiEX LLC 
KalshiEX LLC

APPENDIX A – CONTRACT TERMS AND CONDITIONS 

Official Product Name: Will <above> <count> weight loss drugs be prescribed by <date>? 

Rulebook: WEIGHTDRUGS 

KalshiEX LLC 
KalshiEX LLC

WEIGHTDRUGS

Scope: These rules shall apply to this contract. 

Underlying: The Underlying for this Contract is prescriptions of products with combined 

molecules semaglutide and/or tirzepatide for <month> according to IQVIA. Revisions to the 

Underlying made after Expiration will not be accounted for in determining the Expiration Value. 

Source Agency: The Source Agency is IQVIA. 

Type: The type of Contract is an Event Contract. 

Issuance: The Contract will be issued on a monthly basis. 

<count>: Kalshi may list iterations of the Contract with <count> levels that fall within an 

inclusive range between 0 and 1,000,000,000 at consecutive increments of <1>. Due to the 

potential for variability in the Underlying, the Exchange may modify <count> levels in response 

to suggestions by Members. 

<month> : <month> refers to a calendar month specified by Kalshi. Kalshi may list iterations of 

the Contract corresponding to variations of <month>. 

Payout Criterion: The Payout Criterion for the Contract encompasses the Expiration Values that 

are <above> <count>. 

Minimum Tick: The Minimum Tick size for the referred Contract shall be $0.01. 

Position Limit: The Position Limit for the $1 referred Contract shall be $25,000 per Member. 

Last Trading Date: The Last Trading Date of the Contract will be the day before the expected 

data release of date. Data is expected to be released the second Wednesday of the month 

following <month>. The Last Trading Time will be 11:59 PM ET. 

Settlement Date: The Settlement Date of the Contract shall be no later than the day after the 

Expiration Date, unless the Market Outcome is under review pursuant to Rule 7.1. 

Expiration Date: The Expiration Date of the Contract shall be the sooner of the date of the first 

10:00 AM ET following the release of the data for all of <month>, or one month after <month> 

has ended. 

KalshiEX LLC 
KalshiEX LLC

Expiration time: The Expiration time of the Contract shall be 10:00 AM ET. 

Settlement Value: The Settlement Value for this Contract is $1.00. 

Expiration Value: The Expiration Value is the value of the Underlying as documented by the 

Source Agency on the Expiration Date at the Expiration time. 

Contingencies: Before Settlement, Kalshi may, at its sole discretion, initiate the Market 

Outcome Review Process pursuant to Rule 6.3(c) of the Rulebook. 

KalshiEX LLC