Novo Nordisk’s Wegovy diet pill is rapidly growing in popularity.
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LONDON — The meteoric rise of diet pills such as Wegovy and Mounjaro is spawning a slew of new product lines as companies look to get on the right side of health care disruptors.
Sectors from food and drink to retail and fitness are in the spotlight as demand surges amid concerns that so-called wonder drugs from Novo Nordisk and Eli Lilly could dramatically alter consumer habits. focus.
However, some companies say they are embracing newfound market opportunities.
Dutch biosciences company DSM Firmenich is exploring nutritional supplements to complement and compensate for some of the effects of weight-loss drugs, CEO Dimitri de Vreeze said on Wednesday, telling CNBC it was a natural development for the industry.
de Vreeze told CNBC’s “Squawk Box Europe”: “If you lose weight and you’re successful, you move to the health, nutrition, lifestyle counter because you basically want to continue with what you have. That’s where we are. Play a role.
The weight-loss injection relies on a group of drugs called GLP-1 receptor agonists (glucagon-like peptide 1), which work by mimicking a naturally occurring gut hormone that has Helps regulate the brain’s appetite.
Research is still ongoing on some further health applications of appetite suppressant drugs, as well as potential side effects. But de Vreeze said his company is also looking for products that can enhance muscle retention and protein intake.
“Weight loss drugs have some side effects that mean it’s harder to build muscle, it’s harder to maintain protein levels. And here we play a role. We’re using ingredients, developing ingredients, and it’s kind of like compensating,” he said.
Novo Nordisk and Eli Lilly did not immediately respond to CNBC’s request for comment.
Providing consumer goods to airlines
DSM isn’t the only company looking to capitalize on the growing weight-loss drug market.
Swiss food giant Nestlé announced last month that it would launch a new range of frozen meals aimed at GLP-1 drug users. The Vital Pursuits range will initially offer 12 products, including whole-grain bowls and pizzas, and are designed to serve as nutritional “companions” to medications, the company said explain.
CEO Mark Schneider told CNBC last week that while diet pills are changing consumer behavior, “nutritional needs have not gone away.”
GLP-1 drugs “will certainly be an interesting addition to all the other needs we are trying to meet in the food industry,” Schneider said.
Danone CEO Antoine de Saint-Affrique also told CNBC in April that he considered GLP-1 to be a “complement” to the French food company, adding that they would only increase demand for its nutritional products.
However, Barclays analysts said it was uncertain whether weight-loss drugs would make consumers more or less willing to buy health products.
“Greamed adoption of GLP-1 drugs could be viewed as alternatives to food categories more suited to health and wellness,” analyst Andrew Lazar said in a research note last year.
“That said, consumers may also be eating more weight management foods as they strive to eat healthier and replace more indulgent snacking alternatives with such products,” he added.
The bank’s analysts added that the shift could have a similar impact on restaurants, food retailers and delivery companies that “have moved aggressively” to accept the drugs. If consumers believe the drugs can “offset” the addiction, fast-food companies including KFC’s Yum Brands and Shake Shack are potential beneficiaries.
Airlines also have much to gain from reducing passenger numbers as they increasingly focus on reducing jet fuel costs. in a september notes Jefferies analyst Sheila Kahyaoglu quoted Bloomberg as saying United Airlines If the average passenger’s weight dropped by 10 pounds, $80 million would be saved annually.
Barclays said even drug packaging companies could benefit, with companies such as Germany’s Gerresheimer predicting revenue in the $100 billion weight-loss drug industry could grow 2-4%.
Competition for weight-loss drugs becomes increasingly fierce
It’s unclear whether such supplements can replicate the meteoric rise of weight-loss drug companies like Novo Nordisk and Eli Lilly.
“We believe it is too early for investors to clearly position themselves outside of healthcare stocks on the impact of GLP-1 drugs, and the range of potential scenarios is very broad,” Barclays analysts wrote.
Asked whether growing demand for nutritional products was reflected in the company’s stock price, DeFreeze admitted it was “too early” to tell.
“It’s something you need to build over time. It’s brewing. But once the change happens, you’ll see it reflected,” he said.
The new products come as other drug companies are following Novo and Eli’s lead in trying to get a piece of the weight-loss pie.
About 15 generic versions of Ozempic and Wegovy are currently in development in China, the drug’s main market, according to clinical trial records. Quote Reuters reported on Thursday.
At the same time, some analysts are also cautious about the continued growth of the weight-loss drug market itself.
“We don’t necessarily think that a ‘miracle’ drug will always be a wonder drug,” Guillaume Menuet, head of investment strategy and economics for EMEA at Citi Wealth, told CNBC on Thursday.
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