HOUSTON — A new class of drugs called GLP-1, originally designed to fight type two diabetes, have exploded in popularity thanks to their ability to help people lose weight.
Sold under brand names like Ozempic and Wegovy, they slow the emptying of your stomach, making you feel fuller, resulting in you eating less.
Obese patients on these drugs can lose 15-20% of their weight. According to the Washington Post, health care providers wrote more than nine million prescriptions for these drugs in the last three months of 2022.
So why would weight loss affect seemingly unrelated companies? Walmart reported to Bloomberg they have already noticed changes in buying patterns in customers taking the drugs. It’s probably not surprising, but they are buying less food. In the wake of that report, companies like Hershey and Pepsi saw their stocks slide.
Bank of America analysts took things even further. Since the drugs appear to help control addictive behaviors businesses related to tobacco alcohol and gaming could be affected too.
Other investors see a chance to make money. According to analysts at one investment bank, these drugs could help airlines save money. If you assume the average passenger lost ten pounds, it would reduce weight on a single flight by 1,790 pounds. That would save an airline about 80 million dollars a year in fuel costs. Some real food for thought.