How food companies plan to make a fortune on weight-loss drugs

Diet culture has influenced how Americans eat for decades. From SlimFast to Atkins to Weight Watchers (now WW International), these programs and products have introduced habits that found a way to infiltrate the eating patterns of people who weren’t even knowing participants.

Now the most buzzed-about weight-management tool comes in the form of an injection. GLP-1s, more commonly known by brand names like Ozempic, Zepbound, and Wegovy, are affecting the way we eat.

A KFF Health Tracking Poll last May found that 12% of American adults said they’ve taken a GLP-1 agonist at some point, and 4 out of 10 users reported taking it primarily for weight-loss purposes, though the drug was originally developed to treat Type 2 diabetes. In 2023, Goldman Sachs analysts projected that the industry would be worth $100 billion by the year 2030 and that manufacturers Novo Nordisk and Eli Lilly would control 80% of the market. A report from Polaris Market Research in November was even more bullish, estimating the potential growth of the GLP-1 market could surpass $322 billion by 2034. 

GLP-1s help users shed weight by suppressing appetites and targeting metabolism. One Ozempic user told CBC that her appetite had totally transformed since taking the drug. The biggest change, she said, was that using it had “completely eliminated any snacking” from her daily routine.

As a result, a growing number of food companies have started to address the public’s changing appetite by introducing new ready-to-eat product lines, some of which are targeted specifically toward GLP-1 users, while many more have stealthily launched snack-size and protein-rich menu offerings.

In November 2023, Market Watch reported that fears surrounding the effect of GLP-1s on food products were exaggerated, and that some brands, like JM Smucker and Kraft Heinz, which is the parent company of Oscar Meyer, were well positioned for this medication boom given their high-protein product portfolio.

The report came after the food-stocks sector saw its biggest dip in more than 20 years. But now, over a year later, it’s becoming clear that more and more companies are at least acknowledging new consumer habits with products and pivots.

“The really sad truth is we’re going to have more processed food that costs $5 or less to go with your very expensive injectable,” Andrew Zimmern, a chef and TV personality, told TMZ in May following the introduction of Nestle’s Vital Pursuit brand. 

So far, he’s not wrong. 

Nestle, the home of Toll House, Hot Pockets, and Haagen Daz, says its Vital Pursuit prepared-foods line is “intended to be a companion for GLP-1 weight loss medication users and consumers focused on weight management,” adding that the meals are high in both protein and fiber.

The other key component of Vital Pursuit is portion size. The company said these meals are “portion-aligned to a weight loss medication user’s appetite,” which, research supports, is smaller than what has previously been the norm on grocery-store shelves in the US. Nestle did not respond to a request for comment on how much smaller these portions are.

Conagra, which owns Duncan Hines, Slim Jim, and Birds Eye, is leaning on its Marie Callender’s and Healthy Choice portfolios. The company told Bloomberg that those two product lines — specifically their single-portion meals and frozen appetizers — have seen a jump in sales, and they’re attributing it to the products appealing to GLP-1 users’ appetites.

Conagra senior vice president Bob Nolan said that the company “felt nervous when those surveys came out,” referring to the data suggesting that GLP-1 users are overall less hungry and less likely to make impulse food purchases. But, he said, nearly a year later, “We feel a lot better.”

A representative for Danone, the parent company of Activia, International Delight, and Dannon, told Sherwood News that the widespread use of GLP-1 medication is “reshaping the conversation” around the public’s approach to weight management, and there’s demand for more nutrient-forward choices. The company says it’s “actively following this market shift” but that it’s already in a position to respond, with its product portfolio leaning heavily on what it calls “nutrient-dense” items. 

“For example, one of the key challenges for GLP-1 users is the risk of muscle mass,” the rep said. “Our house of brands provides a variety of benefits, flavors, and formats — including several high-protein products from leading brands like Oikos — which allows us to cater to those seeking substantial protein intake.” 

Danone says it’s seen an increase in demand for those products specifically, and the company is leaning in with no plans of slowing down.

Hershey CEO Michele Buck told employees during an earnings Q&A last month that the effects of Americans taking GLP-1s was “in line with what we would expect,” and described it as having only a “mild impact” on sales.

“We continue to see multiple sources of data validating that the consumers on those drugs aren’t eating disproportionately less of our category,” Buck said. “I know there’s some mixed data, but we’ve seen a lot on that.”

Buck said that while the company’s snacking category has been underperforming as of late, internal data suggests it’s because customers are feeling financial pressure, not because of GLP-1 usage.

Ramon Laguarta, chairman and CEO of PepsiCo, said during a Q3 2024 earnings call that the company is seeing Gen Z consumers trending toward “mini meals” rather than consuming large portions.

The company plans to continue to incorporate tiers and options for all sorts of consumers, including those who want to make more health-conscious choices. Within the Lay’s brand, for example, Laguarta said it will offer unsalted versions and other snack flavors that keep buyers coming back, regardless of their use of GLP-1s.

“We’ll have subsegments like lightly salted or baked that provide even more permissible options for consumers to stay in potatoes,” he said during the call. “Then we’ll have, at the upper end of the category, brands like Miss Vickie’s that provide a more premium experience.”

Laguarta said the company is investing in what it refers to as “permissible” products. “Our levels of sodium, our levels of fat are being reduced, and that’s creating a positive halo for all our brands,” he said. “It’s really democratizing positive choices to consumers. It’s Sunchips, it’s the Simply range — which covers most of our large brands — it is Smartfood, it is PopCorners, and, as I said, some new addition to the family.”

So while some big brands are making moves overtly targeted at GLP-1 users, others are quietly shifting in a direction that happens to align with those users’ new needs (smaller portions, lower carbs and sugars, higher amounts of protein). While there’s no official guidance as to what foods are considered safe or helpful to eat while on these medications, there are some that may be more or less likely to make consumers feel sick or nauseated.

Smaller companies are making moves, too, like Smoothie King and Home Chef. The former recently introduced a GLP-1 Support Menu of high-fiber smoothies containing 20 grams or more of protein, while the latter launched a new meal-delivery service called Tempo with single-serve potions that are low in sugar and sodium and high in protein. 

“Where there is money to be made, food companies will go there,” Andrew Zimmern told Sherwood. “Our food system is largely responsible for creating an epidemic of obesity in America. And now, rather than make healthier food, they make food styled for GLP-1 users. If that isn’t the definition of putting all the effort into prioritizing profits over people, I don’t know what is. I am very pro big food and very much a capitalist. These big companies do a lot of good in the world. But I don’t get why we can’t simply serve GLP-1 users regular food!” 

But with their bottom lines to consider, these big companies need their most loyal customers — even those on appetite suppressants — to keep buying their products, whatever it takes.

Rachel Askinasi is a journalist covering the food and beverage industry whose work has appeared on Business Insider and NBC. She’s the founder of the Throwing Spaghetti newsletter.