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‘Scared’ CEOs calling up boss of Ozempic maker over weight loss concerns

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Bosses of the world’s biggest food companies have for months been sounding the alarm on the ways appetite suppressant Ozempic could hurt their products. Now some CEOs appear to be so spooked that they’ve gone straight to its developer, Novo Nordisk, in search of reassurance.

Speaking to Bloomberg, Novo boss Lars Fruergaard Jørgensen said he was fielding calls from bosses of food companies who have been caught in the crosshairs of a global weight loss phenomenon.

“A couple of CEOs from, say, food companies have been calling me,” Jørgensen told Bloomberg

“They are scared about it.”

But the drugmaker’s CEO is unlikely to be too concerned about how weight-loss aids will hurt junk food suppliers’ bottom line, and instead more worried about how he can get more of the drugs into shoppers’ nightstands.

CEOs running scared

Jørgensen didn’t name which CEOs had been in touch, or the agenda of the conversations, be it strategy, regulation, or competitiveness. A representative for Novo didn’t immediately respond to Fortune’s request for comment.

But it’s easy to create a long list of potential candidates who made the call based on comments shared with the media in recent months. Warnings have tended to come from companies that make highly calorific products like fast food, snacks, and desserts.

Hein Schumacher, the boss of Ben & Jerry’s maker Unilever, did however rule himself out of that lineup when speaking to Bloomberg TV Thursday.

Novo’s Ozempic has enjoyed a cultural breakthrough over the last 18 months after its GLP-1 diabetes drug was found to aid weight loss. A seal of approval from Tesla CEO Elon Musk, who said he was using the drug for his own weight loss journey, helped popularize it to the masses.

Since then, the Danish pharmaceutical group’s profile has only grown as the bosses of major retailers and food suppliers took the time to name-drop Ozempic in their earnings calls.

The first was Walmart’s U.S. boss John Furner, who said in October that the company was already beginning to see a material impact on its sales thanks to its Ozempic-using customers. 

“We definitely do see a slight change compared to the total population, we do see a slight pullback in overall basket,” Furner said. “Just less units, slightly less calories.” 

Calls to Jørgensen may have also come from fast food companies, with short interest in chains like McDonald’s, Chipotle, and Starbucks rising in October last year.

Other CEOs have sought to reassure investors that they have a plan if a surge of Ozempic take-up changes the junk food industry forever. 

People using appetite suppressants are expected to change their dietary preferences in favor of lower-calorie alternatives that pack in more nutrients.

KitKat maker Nestlé is one of the companies hoping to capitalize on this trend, its CEO telling Bloomberg in October that the group was working on “companion products” packed with vitamins, minerals, and supplements.

“You want to be sure that the weight loss gets supported. You want to be sure that you limit the loss of lean muscle mass,” Mark Schneider said.

Analysts at Barclays, the bank that encouraged a shorting of junk food credits, were bullish on the prospects of French food manufacturer Danone.

Barclays says the food maker could easily double the €500 million ($539 million) in annual sales it makes from its protein yogurts and yogurt drinks if Ozempic users embrace more healthy options, Bloomberg reported.

Supply issues top of Novo’s own concerns

But Novo, which recently surpassed a valuation milestone of $500 billion, has more pressing matters on its mind than how food suppliers might be affected by its revolutionary product.

The group has been overwhelmed by a demand surge that vastly outweighed projections, impacting supply and leaving Novo’s potential market short of product. Several countries have moved to limit exports of the drug so it can go to diabetic patients who have a more urgent need for GLP-1s.

Novo announced earlier this week that it had bought three sites in New Jersey for $11 billion from pharma group Catalent, in a bid to accelerate its expansion into the U.S. and address its supply shortage.

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