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Factbox-Corporate America weighs risks of the Ozempic effect

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LA Post: Factbox-Corporate America weighs risks of the Ozempic effect
October 19, 2023
Reuters

(Reuters) - U.S. companies across sectors such as food and beverage makers and manufacturers of glucose monitors have faced investor questions over the risk to future sales from the growing popularity of promising weight-loss treatments.

Drugs in a class known as GLP-1, such as Novo Nordisk's Wegovy and Ozempic and Eli Lilly's Mounjaro, have been shown to help control blood sugar and dramatically lower weight in clinical trials.

Here's what companies have said about the potential impact:

RETAILERS, FOOD AND BEVERAGE COMPANIES

Conagra might consider changing portion sizes of its snacks if the rising use of weight-loss drugs leads to a change in food consumption patterns.

Walmart expects revenues from its health and wellness products to increase in the second half of the year, mainly due to the popularity of weight-loss drugs.

PepsiCo Chief Financial Officer Hugh Johnston has said the company is "not seeing any impact" yet from the popularity of weight-loss drugs.

DIALYSIS SERVICES PROVIDERS

Germany's Fresenius Medical Care said that use of Ozempic and other drugs of the same class would have an overall neutral effect on how many patients would require its kidney dialysis services in the future.

Davita is closely monitoring developments related to the drug and expects limited impact from use of the drugs, since they may only benefit some kidney disease patients.

MEDICAL DEVICE MAKERS

Johnson & Johnson's third-quarter sales for devices used in abdomen surgeries was hit by a slowdown in demand for weight-loss and other procedures, as many obese patients turned to Wegovy and Ozempic.

The company's Chief Financial Officer Joseph Wolk said use of the drugs could eventually make patients eligible for procedures like hip and knee replacements or other orthopedic surgeries.

Abbott Laboratories, which makes glucose monitoring products, has said that the market was overestimating the impact to its sales from growing popularity of the drugs.

Abbott CEO Robert Ford has said that diabetes patients could end up using glucose monitors with the weight-loss drugs in the long term.

Insulet Corp expects that the use of Ozempic and Mounjaro could delay the time for patients to become dependent on insulin, but does not expect its long-term market for insulin pumps to be impacted.

Surgical robots maker Intuitive Surgical has warned that Wegovy's popularity is weighing on demand for bariatric, or weight-loss, surgeries.

DRUG DISTRIBUTORS

Cencora, formerly called AmerisourceBergen, Cardinal Health and McKesson have flagged potential boost to revenues this year owing to the growing demand for weight-loss drugs.

(Reporting by Bhanvi Satija in Bengaluru; Editing by Mrigank Dhaniwala)

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