May 21, 2024 - Business

Nestlé launches frozen food brand aimed at weight-loss drug users

Illustration of a fork with measuring tape hanging off stylized as a noodle.

Illustration: Aïda Amer/Axios

Nestlé on Tuesday announced a new frozen food brand aimed at weight-loss drug users in one of the first direct responses by a major food company to the surging GLP-1 medications.

Why it matters: Debate is swirling over whether this new class of treatments will reshape how Americans eat.

Between the lines: Nestlé debuted Vital Pursuit, which it described as "a new line of foods intended to be a companion for GLP-1 weight-loss medication users and consumers focused on weight management."

  • Vital Pursuit's products — all sold for $4.99 or less — will be "high in protein, a good source of fiber, contain essential nutrients, and they are portion-aligned to a weight-loss medication user's appetite," the company said.
  • Items include sandwich melts, pizzas and bowls with whole grains or protein pasta.

The big picture: The move calls attention to a broader discussion over how anti-obesity drugs like Novo Nordisk's Wegovy and Eli Lilly's Zepbound could divert sales from not-good-for-you foods.

  • Walmart's U.S. CEO, John Furner, caused a stir when he told Bloomberg in October that GLP-1 patients who shop for food at the retailer were buying "less units, slightly less calories."

My thought bubble: For Nestlé, it makes sense to invest in a product area — frozen foods — where the company already has expertise.

  • The company's wide range of products include frozen brands like Stouffer's, Lean Cuisine, Hot Pockets and DiGiorno.

Yes, but: Some food industry execs are skeptical about the impact of these drugs on food consumption.

  • "I think the whole topic has been overblown," Dirk Van de Put, CEO of Oreo maker Mondelez International, said on an earnings call in November, noting that "we see absolutely no short-term impact" and only a 0.5% to 1% volume effect within 10 years.
  • Dan O'Leary, a former Hostess exec who oversees J.M. Smucker's sweet baked snacks, told Axios in April that "we're not seeing a material effect on sales to date."

What we're watching: One big question is how many people will ultimately become GLP-1 users.

  • Morgan Stanley researchers last year projected that over the next 10 years, 7% of the U.S. population — 24 million people — could be taking these drugs.
  • And those people will likely consume 20% fewer calories, the researchers projected.
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