Major weight-loss drugs are seeing increased uptake and interest and those who use them are spending less when shopping for food, according to Morgan Stanley.
An updated Numerator survey of 92K people showed that 12.3% of households indicated that they had a member taking GLP-1s like Novo Nordisk’s (NVO) Ozempic and Wegovy and Eli Lilly’s (NYSE:LLY) Mounjaro and Zepbound.
“Monthly spend on categories most negatively impacted by GLP-1 users for weight loss in include snacks, pastries, and ice cream while yogurt, fish, and vegetable snacks are most positively impacted,” analyst Pamela Kaufman and team said. “Our prior survey work suggests a notable reduction in the consumption of less healthy categories when taking GLP-1 drugs.”
Households “spend more on groceries than non GLP-1 HHs, but their spending declines after starting medication use. Before beginning treatment, GLP-1 HHs spent over $150 more a month on average on groceries when compared to non GLP1 HHs,” Kaufman said. “Part of the difference reflects larger household size, higher income, more children, and generally higher spending on food.”
“When monthly grocery spend is indexed to adjust out the aforementioned differences GLP-1 HHs monthly grocery spend decreased anywhere from 6% to 9% more than the change in spending among non-GLP-1 households.”
Major grocery stocks include Walmart (WMT), Target (TGT), Kroger (KR) and Albertsons (ACI).