Biotech
Monday, April 22nd, 2024 6:56 pm EDT
Key Points
- GLP-1 drugs, known for their effectiveness in weight loss and diabetes management, are impacting consumer spending habits, with many users reporting reduced spending on dining out and takeout, as revealed by a Morgan Stanley survey.
- The rising demand for GLP-1 drugs, expected to reach a market worth $105 billion by 2030, raises concerns about their potential impact on the revenue of restaurants and packaged food companies.
- While healthier fast-casual restaurants are better positioned to adapt to the increasing use of GLP-1s, domestic service restaurants and indulgent fast-casual chains may face more pressure. Among beverage companies, those producing alcoholic drinks are deemed most at risk.
The increasing popularity of GLP-1 drugs, renowned for their effectiveness in weight loss and diabetes management, is not only impacting consumers’ health but also reshaping their spending habits, particularly in the food industry. According to a Morgan Stanley survey, a significant proportion of GLP-1 drug users are cutting down on dining out and ordering takeout, with 63% reporting reduced spending on restaurants. This trend extends to grocery shopping, albeit to a lesser extent, with 31% spending less. With GLP-1 drug demand expected to soar, Morgan Stanley forecasts the market to reach $105 billion by 2030, affecting around 9% of the U.S. population by 2035. Despite concerns among food and beverage companies about revenue implications, Morgan Stanley suggests that GLP-1s pose a manageable long-term pressure on the restaurant industry, emphasizing the importance of adaptation to health-conscious consumer behaviors. Healthier fast-casual restaurants and coffee chains are deemed better positioned to navigate this shift, while indulgent fast-food chains and packaged food companies face more pressure. Among beverage companies, those producing alcoholic drinks are deemed most at risk. The survey highlights substantial changes in consumers’ diets and spending habits since starting GLP-1 treatment, with significant reductions in consumption of snacks, sugary drinks, and alcohol anticipated in the coming years. Moreover, the survey indicates a decline in smoking habits among respondents, though caution is advised in drawing conclusions regarding GLP-1s’ impact on addictive behaviors.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/04/20/weight-loss-drug-patients-spend-less-on-restaurants-takeout-survey.html
