WESTERN PRODUCER — There is a weird juxtaposition in society today as a deep concern over food affordability and accessibility coincides with enormous interest in new types of weight loss drugs.
You might not have heard of semaglutide, but that is the active ingredient in the brand name drug Ozempic, which is hard to not know about if you pay any attention to celebrity or lifestyle news. The same ingredient is in another brand name drug, Wegovy, which is specifically formulated for weight loss.
There is so much buzz about this development that analysts and food companies are wondering if use of these drugs might become so common that they alter the kinds and amount of food we eat on a society-wide basis. If so, that has implications for farmers.
Such speculation might be overdone and interest in the drugs might prove to be a craze that dies out, or the side effects of using them result in a narrowing of their use.
I think that demographic trends such as the greying of society and immigration levels will ultimately have more influence on what we eat.
Time will tell, but let’s look into these drugs in more detail.
Governments started to give approvals to semaglutide as a diabetic drug about seven years ago. However, the drug also suppresses appetite and so is an effective, if expensive, weight loss tool. This led to its drug approvals being expanded to include weight loss.
This weight loss aspect attracted the attention of celebrities and social media influencers who helped spread the news, and it found a receptive audience. The majority of adults in Canada and the United States are already overweight and the percentage considered obese is growing quickly. Close to one-third of adult Canadians are considered obese, and the rate in the U.S. is several percentage points higher.
It is understandable that a lot of people are keen to try the drug to help control their weight.
Ozempic and Wegovy are made by Novo Nordisk, a pharmaceutical company in Denmark.
Its growth has soared, making it the largest company in Europe by stock market valuation, with its share price rising 80 percent over the past year.
It can’t keep up with demand and you might have seen stories a few months ago about Canadians with diabetes complaining that they couldn’t access the drug because the American weight loss market was gobbling up all the supply.
New studies have shown that Wegovy can lower the risk of heart attack, stroke and death from cardiovascular disease. The U.S. Food and Drug Administration has already approved that use, and other health and drug authorities around the world are expected to follow.
Novo Nordisk might be the market leader, but other companies such as Eli Lilly are also getting into the field with their own drugs, such as Zepbound.
So you can see there is potential for many millions, maybe hundreds of millions, of people around the world to take this medication. Currently the drugs must be injected and cost more than $1,000 a month, but companies are working to put it in pill form and lower the cost. Novo Nordisk this month said it has a pill in early trials that indicate it might be even more effective at weight loss than Wegovy.
Morgan Stanley Research analysts estimate that 24 million people, or seven percent of the U.S. population, will be taking these drugs by 2035.
A survey of 300 people using the drug found that users were most likely to reduce consumption of food high in sugar and fat, reducing their consumption of confections, sugary drinks and baked goods by as much as two-thirds.
Close to half of those in the survey said they increased their consumption of fruits and vegetables.
Regarding red meat, 38 percent said they ate less, 49 percent did not change their consumption and 10 percent ate more.
Visits to fast casual restaurants declined by 77 percent.
Food makers and retailers are paying attention.
Walmart’s chief executive officer told Bloomberg news that the company was able to determine from analysis of its pharmacy and grocery data that customers using Ozempic tended to buy slightly fewer groceries.
Last autumn the Ozempic craze was generating all sorts of headlines speculating on the impact on profits of fast food restaurants and producers of snacks.
However, officials with global companies such as McDonald’s and Pepsi have said that they expect, at most, only modest impacts on sales.
Companies might respond by reducing portion size and using healthier ingredients.
Nestle is already working on new lines of products designed for people using the drugs. Because the drugs reduce the urge to eat, some users might not get enough protein and vitamins and might be interested in buying fortified foods to fill nutritional gaps.
