Ozempic‘s Ripple effect: Weight-Loss Drugs Show Promise for Global Economies, Despite Danish Concerns
NEW YORK – The burgeoning popularity of GLP-1 drugs like Ozempic, initially hailed for their impact on individual health, is now sending unexpected ripples through global economies, with projections estimating a potential boost to GDP in major markets. While Denmark,the manufacturing hub for many of these medications,is grappling with a downturn in exports impacting its economic outlook,analysts are forecasting meaningful positive economic consequences elsewhere,particularly in the United States.
Initial enthusiasm surrounding the drugs has been tempered by challenges in Denmark, where production bottlenecks and increased competition have affected exports to key markets, diminishing economic prospects. However, a new report from Goldman Sachs suggests a broader, more optimistic picture.The investment bank estimates that GLP-1 drugs could lift U.S. GDP by approximately 0.4 percent, potentially exceeding 1 percent in a consumer-driven scenario. This growth is attributed to a projected reduction in obesity-related diseases, increased workforce participation, and a shift in consumer spending towards healthier products.
“Our researchers estimate that bad health conditions subtract over 10 percent of GDP of the United States due to the loss of work for illness and disability, of the early deaths and the necessary assistance,” Goldman Sachs explained in a march 2024 report.
Beyond combating obesity, GLP-1 drugs are demonstrating promising results in treating cardiovascular diseases, hypertension, and renal pathology. The economic impact is extending into surprising sectors.
In 2023, Walmart CEO Doug McMillon noted that customer shopping carts were containing “less units, a little less calories” and showing an overall decrease in food expenditure. Analysts also estimate that a 5-kilogram (approximately 11 pound) reduction in average passenger weight could save U.S. airlines around 80 million dollars a year in fuel costs.
Market forecasts are being revised upwards. Morgan Stanley recently increased its projections, now estimating the anti-obesity drug sector will reach 150 billion dollars by 2035, up from a previous estimate of 105 billion dollars.
The anticipated adoption rate is being compared to the spread of smartphones, with analysts predicting that approximately 11 percent of the world’s eligible population – roughly 1.3 billion people – will be utilizing these treatments by 2035. The U.S.could see adoption rates as high as 20 percent, while other countries are expected to reach 10 percent.
Currently, adoption rates remain low at 3 percent in the U.S. and just 1 percent globally. However, the potential for growth is considerable. The U.S. currently has around 8 million patients on GLP-1 drugs, a number projected to reach 30 million by 2035, solidifying the country’s position as the leading global market for these medications.
