Published: December 6, 2023 at 2:13 PM ET
Walmart’s top executive said Wednesday it’s too early to say exactly how a new weight-loss drug growing in popularity in the U.S. will affect consumer behavior.
“The big picture is that we’re seeing some shifts in categories as people think about weight loss,” CEO Doug McMillon said in an interview with CNBC.
“They are…
Walmart’s top executive said Wednesday it’s too early to say exactly how a new weight-loss drug growing in popularity in the U.S. will affect consumer behavior.
“The big picture is that we’re seeing some shifts in categories as people think about weight loss,” CEO Doug McMillon said in an interview with CNBC.
“For example, they buy more fresh produce. There’s some movement, but we don’t know what will happen in the long term. It’s a developing story,” he said.
In October, the company
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U.S. CEO John Farner said in a Bloomberg interview that the company tracks which customers are taking the drug and that they are seeing a “slight decline in the overall basket” and a “decrease in units.” “We can confirm that it causes a slight decrease in calories,” he said.
His comments led to a sharp drop in shares of beverage and snack giant Coca-Cola.
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and PepsiCo
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,
As MarketWatch reported at the time.
New drugs such as Ozempic and Wigovy are used for diabetes and weight loss and work by mimicking the effects of GLP-1, a gut hormone that helps control blood sugar levels and reduce appetite.
The former two are manufactured by Denmark’s Novo Nordisk.
Novo.B
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Meanwhile, Eli Lilly & Company
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Zepbound was approved by the U.S. Food and Drug Administration last month as an obesity treatment. Many other pharmaceutical companies are working on oral formulations, but currently they are only available as injectables.
McMillon said it was too early to estimate the impact on processed foods.
Analysts, especially Morgan Stanley’s equity research team, are busy doing the math, saying companies focused on high-calorie processed foods could see their market share decline as more people are prescribed them. .
Watch now: Morgan Stanley raises forecast for weight loss drug to $77 billion as Ozempic and Wegoby hype continues
In October, Bernstein analysts looked at online data to better understand changes in eating habits, asking patients what foods they were eating and avoiding.
Analysts concluded that the food companies with the greatest exposure are those with portfolios of carbohydrate-focused snacks, such as General Mills.
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and Kellanova, renamed Kellogg.
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.
Read below for more information. The dark side of the weight loss drug craze: Eating disorders, drug shortages, and dangerous counterfeits