The Economics of GLP-1 Weight Loss Drugs

The Economic Burden of Obesity

Obesity is predicted to currently costs the UK economy an estimated £58 billion annually. The NHS reports that obesity has a direct cost of £6.5 billion per year, with many more costs tied to productivity and other related issues. Similar costs are seen globally, with U.S. obesity-related expenses reaching $173 billion per year, creating enormous pressure on health systems and public finances.

GLP-1based weight loss drugs, such as Ozempic, Wegovy, and Mounjaro, offer a potential economic breakthrough. By reducing obesity rates, they could significantly cut healthcare expenditure and improve labour productivity, a win for both public health and economic growth.

Healthcare Savings and Productivity Gains

A study presented at the European Congress on Obesity stated that productivity could be boosted by around £4.5 billion a year, which is around £1,127 per patient annually if all eligible UK adults were given access to GLP-1 treatments. Direct benefits were also backed by the potential for a healthier workforce, taking fewer sick days, having better performance at work, and ultimately a stronger economy.

However, there are side effects to the drugs. A broader roll out may encounter further issues with the current potential effects, including gallbladder and kidney problems, and depression. The cost to the NHS and productivity of these issues on a broader scale may limit the benefits of the drug on cost savings.

Policy, Pricing, and Access: UK and U.S. Approaches

The UK’s NICE guidelines recommend Semaglutide (Wegovy) for patients with BMI ≥30 kg/m², or Tirzepatide (Mounjaro) for ≥35 kg/m², with lower thresholds for ethnic minorities. However, NHS uptake remains limited, just tens of thousands treated out of millions eligible. Health Secretary Wes Streeting has pushed for wider access to these treatments, pointing out that they don’t just improve health, they could also help people get back into work, reducing economic strain. But the price tag is hard to ignore: Wegovy costs around £2,760 a year, far higher than the average medical cost of obesity. With NHS budgets already stretched, this has sparked a big debate about whether the benefits justify the expense.

In the United States, where adoption has been faster, spending on GLP-1 drugs reached over $70 billion in 2023. Despite the upfront costs, employers and insurers increasingly view these medications as investments in long-term health and productivity.

GLP-1s are reshaping both healthcare economics and consumer behaviour. Novo Nordisk recently reduced Ozempic’s list price for uninsured patients from $1,000 to $499 per month under political pressure over drug pricing. Medicare and Medicaid coverage remains limited, but policymakers and employers are exploring bulk-purchase agreements and expanded coverage to achieve long-term savings.

Global Market Forces and Access

After patent expiration, global access is expected to improve significantly. Semaglutide patents are set to expire between 2026 and 2031, opening the door for other manufacturers, for example Indian manufacturers like Biocon are preparing to launch lower-cost alternatives in the UK and EU. This could potentially trigger a price war and as a result improve affordability. This shift is crucial for equity in lower-income populations, where obesity rates are rising fastest.

However, geopolitical risks, such as export restrictions, supply chain bottlenecks, and raw material shortages, could limit access, particularly in developing countries.

Broader Economic and Social Impacts

Global supply chains may get in the way of progress. Export bans, raw material shortages and manufacturing bottlenecks may make it harder for these drugs to reach developing countries, even as demand rises. This may further increase disparities and magnify existing geopolitical issues.

GLP-1 drugs are also affecting other industries, with people eating less, demand for fast food and snacks are dropping. Big names including Pepsi and Constellation Brands have warned investors about potential revenue hits. Financial analysts project that GLP-1 drugs could erase $100 billion from the U.S. food and beverage market by 2030, underscoring the magnitude of disruption. The fitness industry, including gyms and personal trainers may face a slowing in demand, with increasing access to weight loss drugs, customers may rather the medical alternative, especially with costs considered for personal training, some clients may save money and achieve faster, guaranteed results. However, some industries may benefit, for example resale markets for clothes, with people’s sizes changing there may be increased supply of clothing that no longer fits users.

Outlook and Policy Considerations

By 2030, these changes could wipe billions off the global food and beverage industry, highlighting just how disruptive this trend really is.

Looking ahead, GLP-1 drugs aren’t just a medical breakthrough, they’re a major policy challenge. If more evidence proves they save money overall by cutting healthcare costs and boosting productivity, pressure will mount for governments and insurers to cover them.

But big questions remain:

· How can governments negotiate fair prices to keep these treatments affordable?

· Should employers help pay for them as part of workplace health programs?

· And how do we make sure they fit into wider public health strategies, like digital prescriptions or healthy eating incentives?

As patents expire and competition intensifies, affordability and equitable rollout will determine whether GLP-1s become a tool for global health equity and economic resilience or deepen disparities in access.

Final Thoughts

From Ozempic to Mounjaro, GLP-1 drugs are reshaping healthcare, consumer behaviour, and entire industries. Their widespread adoption could mark a historic inflection point in global health economics, with implications spanning labour markets, trade, and public finance. The challenge for policymakers, businesses, and health systems is clear: maximise the benefits, minimise the inequalities, and adapt to the profound economic transformation these drugs are already unleashing.