Corporate America weighs risks of the Ozempic effect

Corporate America weighs risks of the Ozempic effect

U.S. companies in various sectors, including food and beverage makers and manufacturers of glucose monitors, have been facing investor concerns about the potential impact of weight-loss treatments on future sales. Drugs like Novo Nordisk’s Wegovy and Ozempic, as well as Eli Lilly’s Mounjaro, which belong to the GLP-1 class, have shown significant benefits in controlling blood sugar and reducing weight in clinical trials.

Retailers and food and beverage companies have expressed their thoughts on the potential consequences. Conagra may consider adjusting portion sizes of its snacks if the increased use of weight-loss drugs leads to changes in food consumption patterns. Walmart expects its revenues from health and wellness products to rise in the second half of the year, primarily due to the popularity of weight-loss drugs. PepsiCo’s CFO, Hugh Johnston, has stated that the company has not yet observed any impact from the growing popularity of these drugs.

Dialysis services providers, such as Germany’s Fresenius Medical Care, believe that the use of drugs like Ozempic will have a neutral effect on the number of patients requiring kidney dialysis services in the future. Davita is closely monitoring developments related to these drugs and expects limited impact since they may only benefit certain kidney disease patients.

Medical device makers have also been affected. Johnson & Johnson experienced a decline in third-quarter sales for devices used in abdomen surgeries due to reduced demand for weight-loss and other procedures, as obese patients turned to Wegovy and Ozempic. However, the company’s CFO, Joseph Wolk, believes that the use of these drugs could eventually make patients eligible for other procedures like hip and knee replacements. Abbott Laboratories, a glucose monitoring products manufacturer, believes that the market is overestimating the impact of weight-loss drugs on its sales. Abbott’s CEO, Robert Ford, envisions diabetes patients using glucose monitors alongside these drugs in the long term. Insulet Corp expects that the use of Ozempic and Mounjaro may delay patients’ dependence on insulin but does not anticipate a significant impact on its long-term market for insulin pumps. Intuitive Surgical, a surgical robots maker, has warned that the popularity of Wegovy is affecting the demand for bariatric surgeries.

Drug distributors, including Cencora (formerly AmerisourceBergen), Cardinal Health, and McKesson, anticipate a potential increase in revenues this year due to the growing demand for weight-loss drugs.

In conclusion, companies across various sectors are closely monitoring the impact of weight-loss drugs on their businesses. While some anticipate potential changes in consumer behavior and demand for certain products or services, others believe that the impact may be limited or even beneficial in the long run.

About News Team

Hi, I'm Alex Perez, an experienced writer with a focus on lifestyle and culture news. From food and fashion to travel and entertainment, I love exploring the latest trends and sharing my insights with readers. I also have a strong interest in world news and business, and enjoy covering breaking stories and events.

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