Sixteen percent of American households. That's how many now have someone taking Ozempic, Wegovy, Mounjaro, or Zepbound. That number is up from 11% just 18 months ago. And we're still in the first inning of what this means for grocery bills, health insurance premiums, and several other areas.

The GLP-1 drug market hit $70 billion in 2025. It'll be $180 billion by 2035. But the most interesting part of the story is some of the downstream ripples it has created. The second-order effects are already showing up in places nobody anticipated, and it’s pretty wild to dig in to.

Let me walk through what's actually happening, because the headlines typically don’t capture the less obvious trends bubbling up underneath the surface, especially in a story as big as this one.

What These Drugs Actually Do (Beyond the Obvious)

GLP-1 receptor agonists were originally diabetes medications. They mimic a hormone your gut releases after eating that tells your brain you're full and tells your pancreas to produce insulin. Simple enough, but then researchers noticed something. People were losing 15-20% of their body weight. Not the usual 3-5% you'd see with older drugs, but genuinely transformative weight loss. Clinical trials for tirzepatide (Mounjaro/Zepbound) showed average weight loss of 20%. Semaglutide (Ozempic/Wegovy) delivered 14%.

That got everyone's attention. Fast.

These drugs don't just suppress appetite, they fundamentally change your relationship with food. Users describe it as "food noise" disappearing. That mental chatter about what to eat next, the cravings for specific foods, the compulsion to finish what's on your plate? Either reduced or disappeared according to users.

And that's creating some fascinating ripple effects across multiple industries that Wall Street is still figuring out.

The Food Industry Reckoning

Cornell researchers published a study in December 2025 tracking actual purchase data from 150,000 households. Keep in mind these are not surveys but real transaction records.

The numbers are striking. Within six months of starting GLP-1s, grocery spending drops 5.3% on average. For higher-income households, it's over 8%. Fast-food spending falls about 8%. But, it's not evenly distributed across the grocery store. Savory snacks down 10%. Cookies, sweets, and baked goods down 10%. Bread, meat, eggs were shown to be also declining.

What went up? Yogurt (the biggest gainer), fresh fruit, protein bars, meat snacks. Only a handful of categories show increases, and they're modest compared to the overall decline.

So if If 16% of U.S. households have GLP-1 users today and that hits 30-35% by 2030 like many are projecting, you actually could be looking at a longer term structural shift in food demand. PepsiCo and Coca-Cola aren't going to love that. Neither is Mars or Mondelez. Their entire business model depends on repeat purchase behavior driven by cravings and habitual consumption - which is exactly what GLP-1s are said to eliminate.

Some food companies are already adapting. Nestlé and Danone launched "GLP-1 companion products" - which are basically foods designed to counter side effects or provide concentrated nutrition for people eating less volume. High-protein ice cream, nutrient-dense meal replacements, fiber supplements.

This could be a smart move, but it could also be like selling horse feed in 1915 when automobiles were taking over. If the actual behaviors and consumption patters of people change, and people continue to use it, that suggests more of a structural change over time.

Restaurants face a different challenge. Surprisingly, GLP-1 users actually spend more at restaurants post-medication according to Circana. Why? They're still going out socially, but now they want smaller portions or higher-quality options. Casual dining chains experimenting with GLP-1-friendly menus are seeing success.

The Insurance Industry's Nightmare

The insurance companies have to solve a pretty complicated math problem.

GLP-1s cost $766 per month after rebates (up to $1,000 list price). Over 57 million privately insured Americans are clinically eligible - meaning they have obesity, diabetes, or are overweight with risk factors.

Currently only 10.5% of eligible people are actually taking them (up from 6.9% in 2023). But what happens when that hits 20%? Or 30%?

The Employee Benefit Research Institute ran simulations. If employers cover GLP-1s broadly, premiums increase 5.3% to 13.8% depending on adherence rates and eligibility criteria. One Minnesota school district saw GLP-1s account for just 2% of prescriptions but 56% of total drug spending.

That's not sustainable.

So insurance companies are tightening coverage. Mass General Brigham Health Plan eliminated weight-loss coverage entirely for 2026 (keeping diabetes coverage). Four states - California, New Hampshire, Pennsylvania, South Carolina - dropped Medicaid coverage for obesity recently. As of right now only 13 states still cover it.

Marketplace insurance premiums are rising 18% average for 2026 according to Health System Tracker. GLP-1s aren't the only driver, but they're growing into one.

The irony in all of this is that over the long-term, these drugs might reduce healthcare costs by preventing obesity-related conditions like diabetes, heart disease, joint problems. But "long-term" means 10-20 years. And half of GLP-1 users discontinue within a year due to cost or side effects.

When people stop, Cornell's data shows their grocery spending reverts to pre-medication levels, and they actually buy more candy and chocolate than before they started. Weight gain tends to come back after stopping as well, with one University of Oxford study found users regain all lost weight within 1.7 years of stopping. If this is the case, then insurers are stuck paying $9,000 annually per user for a medication people might not stick with, that might not produce lasting benefits, while facing pressure from employers furious about premium increases.

The Trump administration announced a deal in November 2025 to bring GLP-1 prices down to $245 monthly for Medicare/Medicaid users starting 2026. That helps, but it doesn't solve the fundamental problem of whether these drugs are cost-effective at any price. This is especially difficult when adherence is so low and stopping treatment within the first year is so common.

The Healthcare Sector Transformation

Beyond insurance, the entire healthcare delivery model is already shifting.

Endocrinologists can't keep up with demand. Telehealth companies like Hims, Ro, and Calibrate exploded offering GLP-1 prescriptions online. Compounding pharmacies (which make custom formulations) filled the gap during shortages, though FDA is cracking down now that supply has normalized.

Primary care doctors are prescribing these drugs for conditions never studied in trials - like alcohol use disorder, sleep apnea, even Alzheimer's prevention. The FDA approved Wegovy for cardiovascular disease in March 2024 based on trial data. More indications are coming.

Novo Nordisk and Eli Lilly can't manufacture fast enough. Novo is investing roughly $6 billion in production capacity. Eli Lilly spent $1.8 billion upgrading facilities in 2024. And they still have supply constraints.

The first oral GLP-1 for weight loss (Wegovy pill) got FDA approval in December 2025. Eli Lilly's oral version is expected this year. It seems clear that this will expand the addressable market significantly - lots of people won't take weekly injections but will pop a daily pill.

Then there's the next generation of these drugs, currently being developed and tested by the established giants like Lilly and Novo. Retatrutide (Lilly's new drug in late-stage trials) delivers 20% weight loss targeting three hormones instead of one or two. It could be approved in 2026. Oral formulations from smaller biotech companies are coming. The competition is intensifying and will continue to as this market develops and matures.

Investment Implications

If you're thinking about portfolio positioning, here's what matters.

Winners:
Novo Nordisk and Eli Lilly obviously. Combined they control about 90% of the GLP-1 market. Novo's stock has been on a tear, but it's already priced for perfection. Lilly similarly. You're not getting in cheap.

Health-focused food companies like Beyond Meat, Vital Farms, high-protein brands. Companies positioned around functional nutrition, not indulgence.

Contract manufacturers making GLP-1s. CDMO (contract development and manufacturing) companies with peptide expertise are capacity-constrained.

Losers:
Snack food giants. Mondelez, PepsiCo (Frito-Lay), Mars. Not saying they're going bankrupt, but if the trend continues then growth rates will inevitably compress.

Fast-casual restaurant chains heavily dependent on high-frequency visits. If your business model assumes people eat out 12 times a month and that drops to 8, the math changes. Add this to the cost of living and inflationary environment we find ourselves in, and you have a couple of big trends that could do serious damage over time.

Traditional weight-loss companies. Weight Watchers rebranded to WW International and pivoted to telehealth GLP-1 prescriptions because their core business was dying.

Remains to Be Seen:
Insurance companies. UnitedHealth, Cigna, Elevance - these companies are all dealing with cost pressure but also potentially healthier populations long-term if people stay on medications. Too early to call.

Pharmacies. CVS and Walgreens capture dispensing fees, but margins are thin and PBMs squeeze them constantly. It will be something to follow, but we can’t really tell from the data here yet.

I guess the biggest question that pops in my head is, what happens when 30-40% of the population has been on and off these medications for years? We've never had appetite-suppressing drugs at this scale before. The psychological effects, the metabolic impacts, the social dynamics - it's all relatively uncharted territory and we don’t know what that looks like over years and decades.

There's also an equity problem brewing. The wealthy can afford $1,000/month or have employer insurance covering it. Medicaid in most states doesn't cover obesity treatment. So you're creating a two-tier system where rich people get pharmaceutical help losing weight and poor people don't.

And then there's the cultural shift. For the first time in history, we have a technological solution to obesity that actually works. Does that reduce stigma, or does it create new judgment for people who don't use the drugs?

This isn't just about weight loss medication. It's about a $100 billion market that could be fundamentally reshaping how people eat, how insurance companies price risk, how food companies formulate products, and how healthcare gets delivered.

The first-order effects are obvious - people lose weight. The second-order effects are just emerging, with grocery spending shifts, insurance premiums rising, food companies reformulating. The third-order effects? We haven't seen those yet and only will with time.

But they're coming. And they could matter more than you think.

The Earnout Investor provides analysis and research but DOES NOT provide individual financial advice. Jamie Dejter may have a position in some of the stocks mentioned. All content is for informational purposes only. The Earnout Investor is not a registered investment, legal, or tax advisor, or a broker/dealer. Trading any asset involves risk and could result in significant capital losses. Please, do your own research before acquiring stocks.