We Live in the Economy of Ozempic

Ozempic and other GLP-1 receptor agonists have revolutionized the weight loss world. Now, the drugs appear to have some unexpected side effects on the economy.

Sales of Ozempic, Wegovy, and similar drugs increased by 300% between 2020 and 2022, according to a Trilliant Health analysis. Celebrities like Oprah Winfrey and Elon Musk, who admitted taking GLP-1 receptor agonists, only contributed to the soaring demand.

GLP-1 receptor agonists were initially developed for treating type 2 diabetes but are increasingly used off-label for weight loss, as they can help to shed up to 20% of the body weight. The drugs work by reducing appetite and food intake, while limited research and anecdotal evidence suggest that the medications can also curb alcohol cravings.

Unsurprisingly, the food and restaurant industry will be among the first ones to feel the impact of the Ozempic. Walmart observed a noticeable downturn in food sales due to the increasing use of GLP-1 agonists, the retail giant revealed in October.

Morgan Stanley predicts an up to 3% decrease in overall consumption of carbonated soft drinks, baked goods, and salty snacks by 2035 as more Americans are taking obesity drugs.

"The food, beverage, and restaurant industries could see softer demand, particularly for unhealthier foods and high-fat, sweet and salty options,” Morgan Stanley’s tobacco and packaged food analyst Pamela Kaufman wrote in September.

The winners of reduced food consumption

The increasing use of GLP-1 receptor agonists will change consumer habits and food choices, says Angeli Gianchandani, a global brand strategist and communications leader and a practitioner in residence at Pompea College of Business with the University of New Haven.

“If someone made a daily trip to Starbucks or Chipotle, you might see that reduced from their routine, and that will impact the economy,” Gianchandani says.

The appetite-decreasing medications can shrink calorie intake by 20% to 30% daily, according to a Morgan Stanley survey of 300 patients taking GLP-1s. And while only 1.7% of Americans took these drugs in 2023, the trend makes the food industry anxious.

In February, the chief executive officer of Novo Nordisk, the manufacturer of Ozempic, said he was getting calls from scared food industry CEOs asking for details about how the drugs work and how fast they would roll out, Bloomberg reports.

However, Gianchandani predicts that progression in spending habits and shopping patterns will be slow. And once people go off the drug, they could then go back to their regular consumption habits.

And so would the pounds they shed. A 2013 study suggests that weight loss on Mounjaro may return within a year after discontinuing the drug.

Money no longer spent on junk food is unlikely to stay in consumers' pockets. Gianchandani says the spending on gym memberships, different types of clothing, and more organic foods could increase. People might buy more fruits, vegetables, and protein foods to maintain their weight loss.

Some food companies are already looking for ways to keep up with changing demand. For instance, Nestle, the producer of KitKat, is developing new products that could complement weight-loss treatments.

Gianchandani points out that restaurants have once accommodated serving customers on gluten-free diets. For those on GLP-1s, restaurants could offer foods high in protein and smaller serving sizes.

Will the labor force come back?

The impact of GLP-1s may go beyond the changes in consumer habits. Goldman Sachs has recently predicted the U.S. gross domestic product could grow by an additional 1% if 60 million Americans take the drugs by 2028.

Health-related problems keep people from participating in the labor force and, as a result, inhibit economic growth, according to Jan Hatzius, the chief economist at Goldman Sachs.

"Combining current losses in hours worked and labor force participation from sickness and disability, early deaths, and informal caregiving, we estimate that GDP would potentially be over 10% higher if poor health outcomes did not limit labor supply in the U.S.," Hatzius wrote.

About 40% of American adults have obesity, which is a risk factor for serious health conditions, such as high blood pressure and cholesterol, type 2 diabetes, and several cancers.

The annual cost of obesity-related absenteeism in the U.S. ranges between $3.38 billion and $6.38 billion, the Centers for Disease Control and Prevention data shows.

Gianchandani says using GLP-1s can increase longevity, lower health and medical costs, and lead to adjusted insurance costs.

“Companies should plan on having people stay beyond a certain threshold into older age,” she tells Healthnews.

Many unknowns for the healthcare industry

Morgan Stanley estimates that 24 million people, or 7% of the American population, will be taking GLP-1s by 2035. However, as weight loss drugs, they are still inaccessible for many due to the list price of about $1,000 a month and insurers’ hesitation to cover them.

With the medications already changing consumer habits, some hope they could transform healthcare, too. In 2019 alone, obesity-related medical care costs in the U.S. were nearly $173 billion, and the epidemic of obesity shows no signs of slowing.

Ge Bai, Ph.D., a professor of health policy and management at Johns Hopkins Bloomberg School of Public Health, says evidence that Ozempic and similar drugs could reshape U.S. healthcare is limited thus far.

Although GLP-1s are remarkably effective in weight loss, their long-term effects are unknown. The drugs have been associated with severe side effects, including pancreatitis, stomach paralysis, and psychiatric events like suicidal ideation. It is not well understood if patients can continue with the weight loss after stopping the medication.

Bai says the use of GLP-1 receptor agonists threatens the sustainability of insurance only if their price stays high, which she thinks is unlikely.

If you look at the pipeline of that category of drugs, many new drugs are being developed, and many are in a very late stage of development. If more competition happens, I do not believe the drug price will be that high.


Medicare is currently prohibited by law from covering drugs used for weight loss. However, Medicare Part D plans can cover GLP-1s for their other medically-accepted indications, such as to treat diabetes and reduce the risk of serious heart problems, following the expansion of Wegovy’s indications in March.

Moreover, at least one bill has been introduced in the Senate that aims for Medicare coverage to include obesity medications.

Expansion of Medicare’s coverage for GLP-1 agonists for weight loss would have a major impact on private insurance companies' decisions, significantly increasing the likelihood that they will start covering the drugs too, Bai says.

Half of American employees want weight-loss drugs to be included in their health benefits, according to a recent survey by Tebra, a healthcare software company. The respondents said they would give up remote work or vacation days in exchange for the drugs being included in their benefits.

Despite optimistic predictions, the impact GLP-1s will have on the economy and healthcare is yet to be seen. However, improved health is already a victory for individuals and society.

Gianchandani says, “GLP-1s are an opportunity to change how people feel. Reduced weight gives them more energy, and if it can boost the economy, it will definitely create change.”

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