More Speculation About GLP-1s, Consumers, and Economics

Will savings from reduced food and beverage spending be sufficient to cover the cost of obesity medicines? Will these medicines transform the patterns of a whole range of consumer purchases? Speculation about GLP-1s, consumers, and economics is rampant right now. It’s popping up in both serious economic reporting and academic journals.

The speculation is only growing louder.

Changing Consumer Habits
Distorting Global Markets

In the Washington Post this week, economic journalist Catherine Rampell writes:

“A new technology is disrupting the economy. Even experts don’t entirely understand how it works, its full range of uses, and what its unintended consequences could be.

“No, it’s not artificial intelligence; I’m talking about weight-loss drugs. With adult obesity rates falling last year for the first time in more than a decade, drugs such as Ozempic and Zepbound are already reshaping Americans’ waistlines. Now, they’re poised to reshape the entire economy, too.”

Her article makes for fascinating reading as she whirls through spending on GLP-1s, effects on consumer purchases, savings on other health spending, and ripple effects through other industries, governments, global economics, and labor markets.

Though much of this is speculation, the scope of potential effects is breathtaking.

Data on Food and Beverage Savings

In the International Journal of Obesity, Ohio State economist Brian Roe published careful estimates of potential savings on food and beverage purchases for persons taking obesity medicines. To make these estimates he collected data from 457 current users of GLP-1 medicines for obesity about their household food and beverage purchases both before and after they began their therapy.

From his analysis, he concluded that more than 20% of people taking GLP-1s would save enough on food and drinks to fully cover the discounted cash price of these drugs. He also observed that savings seemed to be higher for the people who were most persistent in taking these drugs.

We will say it again: These observations come with a grain of salt. Roe’s estimates are just that – estimates. They come from self-reported data, which has significant weaknesses. Much of Rampell’s piece is speculative. But even with those limitations, they offer fascinating food for thought.

Click here for the view from Rampell and here for Roe’s analysis. For another look at this, Axios yesterday published a piece here, which is more focused on healthcare effects.

The Cake Shop, painting by Edouard Vuillard / WikiArt

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January 2, 2025