The Use of GLP-1 Drugs for Weight Loss Goes Beyond Slimming. It’s Transforming the Economy.

GLP-1 weight-loss drugs, such as Ozempic and its GLP-1 cousins Mounjaro, Wegovy and Zepbound, are poised to become one of the most disruptive healthcare innovations of the decade (see Ozempic the new "miracle" weight loss drug).

These drugs, originally developed for the treatment of diabetes, have demonstrated remarkable efficacy in weight loss, hence their widespread adoption. Now there’s an ever-growing list of other potential uses (on- or off-label), including for treating heart disease, sleep apnea, Alzheimer’s, substance abuse and maybe even gambling addiction.

As their popularity grows, their economic impact will be felt across multiple sectors from food production and healthcare to insurance, fitness, apparel and leisure.

As of May 2024, roughly 1 in 8 Americans have tried GLP-1s and almost 16 million Americans (6% of adults) were taking these drugs. This percentage has almost certainly grown since then, as compounding pharmacies aggressively market GLP-1 prescriptions. Jan Hatzius, Chief Economist at Goldman Sachs, predicts that if 60 million people take GLP-1s by 2028, the GDP would be boosted by 1%, or several trillion dollars.

While there are clear benefits—such as reduced obesity-related health costs and increased productivity—there are also challenges. Businesses must prepare for this shift by adapting their offerings, whether that means reformulating food products, rethinking insurance policies, pivoting fitness programs, apparel or leisure activities.

Six reasons these blockbuster drugs will disrupt the US economy

Spending on GLP-1s is skyrocketing

Most insurance plans don’t (yet) cover GLP-1s for weight loss, and the list price for the brand-names can run upward of $1,000 a month. But that hasn’t scared everyone off: Pharmacies are having trouble keeping the meds in stock, and semaglutide (the active ingredient in Ozempic and Wegovy) was the top-selling drug in 2023.

Perhaps this is unsurprising, given that more than 40 percent of Americans are clinically obese. The United States spent an estimated $40 billion on all GLP-1 meds in 2024, with spending projected to triple by 2030.

GLP-1 consumers are spending less on junk food, soft drinks and alcohol

As GLP-1 drugs reduce appetite and calorie intake, companies in the food industry—especially those reliant on high-calorie, ultra-processed products—may face a decline in demand. The average household with at least one family member on a GLP-1 is spending about 6 percent less on groceries each month within 6 months of adoption. That translates to about a $416 reduction in food and drink purchases per household a year. Spending reductions are even greater for high-income households, according to a new study by researchers at Cornell University and Numerator. Fast food chains, snack manufacturers, and soft drink and alcohol sellers may need to reformulate products or pivot to healthier options to maintain market share.

However, this shift also presents opportunities for businesses catering to health-conscious consumers. Brands offering high-protein, nutrient-dense, and smaller-portioned meals could see increased demand.

Healthcare: a new paradigm in obesity treatment

The healthcare sector stands to benefit significantly from reduced obesity-related illnesses such as type 2 diabetes, cardiovascular disease, and joint disorders. According to the CDC, obesity-related healthcare costs in the U.S. exceed $173 billion annually. Widespread use of GLP-1 drugs could alleviate financial strain on healthcare systems by decreasing hospital visits and long-term care needs.

However, companies producing insulin, hypertension medication, and other obesity-related treatments may experience declining sales. The need for bariatric surgeries may also drop, affecting hospitals and medical device manufacturers specializing in weight-loss procedures.

Insurance and workplace productivity: Financial gains and risks

On the longer term from an insurance perspective, a healthier population could lead to lower premiums for employers and individuals. If GLP-1 drugs help people maintain a healthier weight, life and health insurance companies may adjust their risk models accordingly, potentially reducing costs for policyholders.

Furthermore, healthier employees could lead to higher workplace productivity, fewer sick days, and reduced long-term disability claims.

However, companies may also face increased healthcare costs in the short term, as demand for GLP-1 prescriptions rises and insurers navigate reimbursement challenges.

Fitness industry: A challenge to traditional weight-loss models

For decades, gyms, personal trainers, and fitness programs have thrived on the promise of weight loss. With GLP-1 drugs making weight loss more accessible, traditional gyms may struggle to retain customers who primarily exercised for weight control rather than overall health. Planet Fitness, for example, saw its stock decline in 2023 as investors considered the long-term impact of GLP-1 drugs on the industry.

That said, fitness centers emphasizing strength training, wellness, and longevity-focused exercise could thrive. People may shift toward activities that enhance muscle mass and overall health, such as resistance training, yoga, and recreational sports, rather than solely focusing on calorie-burning cardio.

Apparel, leisure and hospitality: changing consumption patterns

There are some potential retail winners. For example, rapid weight loss has encouraged some patients to replace their wardrobes. The clothing rental company Rent the Runway recently reported that more customers are switching to smaller sizes and clothes that are more durable, fitted and stylish than at any time in the past 15 years.

Most often, vacationing may also be affected. Today's GLP-1 consumers are increasingly health-conscious, favoring more physical pastimes, such as hiking in national parks, over all-inclusive, relaxing resorts.

If fewer people are indulging in high-calorie dining experiences, the restaurant and hospitality industries may need to adjust their offerings.  

Final thoughts

The introduction of this new class of GLP-1 weight-loss drugs testifies to the growing recognition of GLP-1's central role in our bodies.

The discovery of innovative drugs can sometimes have unexpected consequences that go far beyond the realm of medicine, with groundbreaking economic and societal impacts that are just beginning to unfold – how we respond will shape the future of healthcare, business and well-being for years to come.

As these medicines gain in popularity, they promise to transform our health and well-being, but also set the stage for disrupting entire industries, from food production and healthcare to insurance, fitness, apparel and leisure.

Changing consumer behavior will require adaptability from businesses to capture new opportunities as the world undergoes far-reaching changes.