The Rise Of Ozempic And Wegovy Is Good For The Yogurt Business

By Bruce Gil

Unlike many other food executives, Danone CEO Antoine de Saint-Affrique is optimistic about what the skyrocketing demand for GLP-1 weight loss drugs could mean for the French yogurt company.

Saint-Affrique told CNBC on Thursday, “We see ourselves as extremely complementary to GLP-1s.”

GLP-1s are a class of diabetes and anti-obesity drugs that suppress a user’s appetite. Popular brands of these drugs include Ozempic, Wegovy and Zepbound.

Although some CEOs are concerned that the drug’s effects will hit their bottom lines, Saint-Affrique argued users will gravitate to healthier food products. He also believes that protein-heavy yogurt could help alleviate muscle loss some users have experienced while taking these medications.

Saint-Affrique rosy outlook is not shared by the food executives who have expressed uncertainty over the impact these drugs will have on their businesses.

Lars Fruergaard Jørgensen, the CEO of Ozempic and Wegovy maker Novo Nordisk, told CNBC in February that chief executives at food companies are calling him for advice regarding diabetes and weight loss drugs.

“A couple of CEOs from, say, food companies have been calling me,” Jørgensen told Bloomberg. “They are scared about it.”

He did not disclose the names of the companies.

The GLP-1 economy

GLP-1s have already had a significant impact on the economy, in various aspects.

Sales of these drugs have transformed Eli Lilly, the maker of Zepbound, and Novo Nordisk into the most valuable pharmaceutical companies in the world. Skyrocketing demand for Novo Nordisk’s Wegovy and Ozempic alone helped boost Denmark’s GDP in 2023.

Wall Street analysts and other business leaders are already looking at what this means for other industries. A Morgan Stanley survey found that 77% of patients reported visiting fast-food restaurants less frequently.

Walmart U.S. CEO John Furner said the company is already noticing changes in consumer behavior from the drugs. He told Bloomberg in October that in comparison to the general population, users are buying fewer things.

On the other hand, executives at Chipotle are hoping users of these drugs will be attracted to their healthier “wholesome” offerings.

Some analysts say that Danone and Chipotle may be on to something.

The New York-based bank William Blair surveyed 300 users of these medications about their eating habits since starting them. Overall, the survey found that respondents reported an average 19% drop in restaurant spending after they started taking a GLP-1. The survey also found that respondents reported increasing their consumption of fruits, vegetables, and salads.

More specifically, the fast-casual salad chain Sweetgreen was the only restaurant respondents reported eating at more frequently after starting a GLP-1.