Weight loss drug patients spend less on restaurants, takeout: survey

A highly popular group of weight loss and diabetes drugs is decreasing some consumers’ appetites — and also how much they spend on food.

Most people taking those medications, called GLP-1s, say they are spending less on eating out at restaurants and ordering takeout, according to a Morgan Stanley survey released on Tuesday. A smaller share of those surveyed say they are tightening their purse strings in the grocery store.

The findings add to the mounting concerns that soaring demand for GLP-1s could take a bite out of the bottom lines of some of the biggest restaurant companies and makers of packaged snacks like Doritos, Oreos and Hershey’s Kisses. GLP-1s include Novo Nordisk‘s blockbuster weight loss injection Wegovy and diabetes counterpart Ozempic, along with Eli Lilly‘s popular weight loss treatment Zepbound and diabetes injection Mounjaro. 

The rising demand for these four drugs isn’t expected to ease anytime soon. In the new survey, Morgan Stanley analysts said they expect the market for GLP-1s to be worth $105 billion by 2030. They also estimate that 31.5 million people, or around 9% of the U.S. population, will take GLP-1s by 2035. 

“There is growing evidence that the drugs have a meaningful impact on consumer behavior and spending on groceries and restaurants,” Morgan Stanley analysts said in the survey. “All of these dynamics suggest GLP-1 drugs’ impact across consumer sectors is set to increase as drug uptake grows and the drugs reshape behavior among a demographic group that represents a disproportionate share of calorie consumption.”

But many food and beverage companies have reassured investors over the last few months that it’s still unclear how much those drugs will lower their revenue. Morgan Stanley also said in the survey that GLP-1s are a manageable long-term pressure on restaurants, not an “existential risk.”  

“Restaurants offer convenience and/or experience in addition to food, and that won’t change with GLP-1 usage,” the analysts said. But some restaurants may have to adapt to health-conscious consumer behaviors, they noted. 

Healthier fast-casual restaurants and coffee are better positioned to manage the increasing consumer use of GLP-1s, including Cava, Chipotle, Sweetgreen and Starbucks, according to Morgan Stanley. Domestic service restaurants and “more indulgent” fast-casual restaurants could face more pressure, including Jack in the Box, Wendy’s, Wingstop, Shake Shack and Portillos. 

Meanwhile, Morgan Stanley views Hershey as the most at-risk among packaged food companies given its American consumer-focused snacking portfolio. Companies that offer healthy foods should benefit from GLP-1s, including Vital Farms, Bellring Brands, Simply Good Foods, the firm said. 

Among beverage companies, those that produce alcoholic drinks are at the highest risk. Those include