The growing popularity of weight-loss drugs that reduce craving for alcohol represents a challenge for Big Liquor
By Bobby Ghosh of Bloomberg
(Bloomberg Opinion) — I’m a keen scholar of the law of unintended consequences. Who would have thought that drugs designed to fight diabetes would be embraced as weight-loss solutions? And who would have thought this would have any bearing on the sales of alcohol?
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The alcohol industry seems to have overcome the threat posed by legalized marijuana but is facing an unexpected challenge from a whole other category of drugs: Weight-loss pills like Ozempic and Mounjaro. Originally created for diabetic treatments, the so-called GLP-1 prescriptions curb cravings for food, which effectively makes them slimming pills. But for some, these drugs also seem to dampen the rewards of addictive substances, whether that’s nicotine, opioids or alcohol.
This bodes ills for booze makers. Wall Street analysts are warning the alcohol industry to brace for impact. Studies conducted by Morgan Stanley’s AlphaWise research unit found that people taking these weight loss drugs consumed 62% less alcohol; more than one in five of them said they had stopped drinking booze altogether.
This is no passing fad. The number of Americans taking obesity drugs is projected to grow nearly fivefold over the next 10 years to 24 million people — roughly the population of Texas. This represents a bonanza for Novo Nordisk and Eli Lilly & Co., but you can see why the following chart might give booze makers the shudders:
Morgan Stanley expects an overall 1.8% reduction in alcohol consumption from weight loss drugs. Since the US alcohol industry is estimated at $197 billion, we’re talking about a $3.5 billion loss in sales.
Booze makers should prepare for this unwanted reduction by introducing more products for weight-conscious consumers, such as nonalcoholic or low-calorie drinks, say Lisa and Leticia. They may also have to double down on premium products to try and prevent a slimming of their bottom lines.Â
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