Obesity and the Economy

Weight-loss pharmaceuticals could spur 1% increase in US GDP, Goldman Sachs suggests

In a recent analysis, Goldman Sachs posits that the extensive deployment of innovative weight-loss medications across the United States has the potential to catalyse a significant uplift in the country’s Gross Domestic Product (GDP) by as much as 1% in the forthcoming years. This optimistic forecast is grounded in the anticipation that a reduction in obesity-related health issues could substantially enhance productivity within the workforce.

The market for these weight-loss medications is anticipated to burgeon, potentially reaching a staggering $100 billion annually by the decade’s end. Leading this burgeoning sector are pharmaceutical giants such as Novo Nordisk, the manufacturer of Ozempic, and Eli Lilly, the producer of Mounjaro. Both companies are at the forefront of developing a category of drugs known as GLP-1 agonists, which have garnered significant interest from various pharmaceutical firms. The projections by Goldman Sachs suggest that consumer uptake of GLP-1 agonists could surge, varying from 10 million to an ambitious 70 million by the year 2028.

The economists at Goldman Sachs elaborate on the potential economic ramifications of this increase in GLP-1 usage, linking it directly to anticipated declines in obesity rates. Citing academic research, they highlight the dual challenge posed by obesity: affected individuals are less likely to be employed and exhibit lower productivity levels when they are in the workforce. According to their analysis, an increase to 30 million users of weight-loss drugs could potentially boost the US GDP by 0.4%, with the potential for a 1% increase if user numbers reach 60 million.

However, the report has not been without its critics, especially from advocates of the body-positivity movement, who may view the report’s implications with scepticism or concern.

Moreover, the report underscores a broader wave of healthcare innovation, particularly highlighting the role of artificial intelligence (AI) in drug discovery processes, combined with the impact of GLP-1 agonists. Together, these advancements could elevate the US GDP by an additional 1.3%, translating to an economic boost of approximately $360 billion per annum at current exchange rates. The potential increase could range from 0.6% to 3.2%, with the effects expected to be more pronounced in the US compared to other developed nations, which generally exhibit better health outcomes.

In parallel, research into weight-loss drugs is expanding to explore their efficacy in treating a range of conditions, from alcohol dependency to dementia. Medications such as Ozempic and Wegovy, which contain the drug semaglutide, and another medication, liraglutide, used under various brand names for both diabetes and weight loss, have seen a surge in popularity. This is partly due to their proven capability to assist individuals in shedding more than 10% of their body weight. The potential for these drugs to confer additional health benefits is being actively investigated in new clinical trials, signalling a promising horizon for medical research and public health.

Study finds some 40% of Chinese children face obesity by 2030

A comprehensive study recently unveiled alarming projections that nearly 40% of Chinese children and adolescents are on track to have overweight or obesity by the year 2030 if current upward trends persist. This pressing issue has prompted calls from experts for immediate action to mitigate the looming health crisis, with proposed strategies including the implementation of a 20% levy on sugar-laden beverages.

The research, which was published in The Lancet Regional Health last month and conducted by a collaborative team from the School of Public Health at Peking University and the United Nations Children’s Fund, highlights the swift rise in obesity rates among the youth in China, pinpointing significant consequent health and financial repercussions.

The study’s forecasts paint a grim picture, estimating a staggering lifetime economic toll of 218 trillion yuan (approximately $31.6 trillion) from 2025 to 2092, attributable to the prevailing rates of obesity among children and adolescents in the absence of intervention strategies.

Zhou Maigeng, Deputy Director of the National Center for Chronic and Noncommunicable Disease Control and Prevention at the Chinese Center for Disease Control and Prevention, stressed that the economic strain posed by the increasing prevalence of children with overweight and obesity is often overlooked, as many related health complications have yet to manifest.

Alarm bells have already been sounded by data concerning adult obesity, which forewarns of the annual costs of chronic diseases linked to excess weight reaching 49 billion yuan by 2030, according to Zhou.

The upward trajectory of childhood and adolescent obesity in China has been startling, with prevalence rates soaring from a relatively modest 8.8% in 2000 to an estimated 37.9% in 2020—an increase of 400% over two decades. This surge has not only eclipsed the global average but also surpassed rates observed in certain Western and upper-middle-income nations. Without decisive action, researchers warn that these figures could exceed 60% by 2030.

In response to this growing public health concern, China has initiated several national interventions aimed at curbing the trend, focusing primarily on enhancing nutrition and physical activity within schools. The proposed introduction of a 20% tax on sugar-sweetened beverages, coupled with tighter restrictions on marketing unhealthy food products to children, has been identified as the most effective course of action.

This recommendation aligns with the World Health Organization’s guidance issued in December, urging nations to adopt or amplify existing taxes on sugary drinks as a measure to safeguard public health. The call to action is supported by evidence from countries like Mexico, South Africa, and the United Kingdom, where such fiscal policies have yielded positive outcomes.

Zhang Man, a researcher at Peking University, emphasised the importance of grounding policy decisions in scientific evidence and underscored the need for ongoing monitoring and evaluation of intervention impacts, suggesting adjustments based on observed results to enhance efficacy.

UK’s obesity challenge: Learning from Japan’s effective approach

In Japan, a unique festive tradition involving Colonel Sanders statues dressed as Santa Claus outside KFC branches marks the start of the Christmas season. This tradition, a result of a marketing strategy from the 1970s, has become a cultural phenomenon, with millions participating in the “KFC Special Christmas Dinner”. This period is significant for KFC Japan, contributing to a substantial portion of their annual sales.

This contrasts sharply with the UK, where traditional home-cooked Christmas dinners are preferred. However, the issue for the UK lies in the dietary habits adopted for the rest of the year. The British tendency towards unhealthy eating has led to an escalating obesity crisis, now costing the economy almost £100 billion annually and impacting productivity far more than previously estimated.

The report by the Tony Blair Institute indicates a worrying trend: two-thirds of the UK’s population are either overweight or have obesity, a figure that has risen by around 11% since 1993. The economic impact of obesity, including healthcare costs and reduced productivity, is projected to increase by an additional £10 billion in the next 15 years. Henry Dimbleby, the government’s former food advisor, highlights the dire consequences of this trend. He points out that by 2035, the costs of treating Type 2 diabetes alone could surpass the current expenditure on all cancer treatments within the NHS.

Comparatively, Japan stands out with one of the lowest obesity rates among developed nations, a mere 4%. This has not always been the case. In the 1960s, Japan was considered one of the least healthy countries in the G7, with a diet heavily reliant on cheap US food imports post-World War II. However, over the following decades, Japan underwent a dramatic cultural shift concerning food, resulting in the world’s highest life expectancy. This transformation demonstrates that obesity is an addressable issue, requiring a change in cultural attitudes towards food rather than reliance on medication.

In Japan, the “bukatsudō” programme plays a pivotal role in promoting physical activity among schoolchildren. This initiative, coupled with the provision of healthier school meals, has contributed to Japan’s low obesity rates among children. In contrast, recent NHS figures show concerning trends in the UK, with significant percentages of children categorised as having overweight or obesity from a young age.

The traditional Japanese diet, which includes fresh fish, small portions of meat, tofu, and vegetables, is inherently healthier than typical Western diets. Andrew Kojima, a celebrity chef, suggests that the UK could benefit from adopting Japanese dining philosophies such as eating until only 80% full and ensuring a variety of colours and types of food in meals.

In Japan, there is a lesser emphasis on snacking and takeaway food compared to the UK. The quality of institutional food in Japan is also notably healthier. Dimbleby recalls a stay in a Tokyo hospital, where meals included healthy options such as pickles, rice porridge, grilled fish, miso soup, and steamed vegetables. He argues that such changes are feasible in the UK without significantly increasing budgets.

Dimbleby’s charity, Chefs in Schools, aims to improve the quality of school meals across England and advocates for an inspection regime similar to Ofsted for school dinners. Another potential strategy is adapting Japan’s “metabo” law, which mandates waistline measurements for citizens aged 40 to 74, with counselling and incentives for those who do not meet the standards. This approach could be implemented in the UK through voluntary annual health checks in workplaces.

Despite the need for action, the UK government has shown reluctance to intervene effectively. The National Food Strategy’s recommendations have been largely overlooked, and proposed anti-obesity measures like junk food deal bans and advertising restrictions have been delayed. Campaigners are calling for the sugar tax on soft drinks to be extended, but there is little movement from the government.

The lack of government intervention and the influence of corporations promoting high-calorie foods mean the UK continues to struggle with an obesity crisis. As the report highlights, Britain urgently needs to adopt successful strategies like those in Japan to address both the public health and economic challenges posed by obesity.

Swiss pharmaceutical giant Roche enters obesity drug race with $2.7 billion Carmot deal

Swiss pharmaceutical giant, Roche, has announced a significant strategic move in the obesity treatment market with its $2.7 billion acquisition of Carmot Therapeutics, a U.S.-based obesity drug developer. This places Roche among leading contenders like Novo Nordisk and Eli Lilly in the weight-loss drug sector. Carmot’s flagship product, CT-388, a once-a-week dual GLP-1/GIP receptor agonist injection similar to Lilly’s Mounjaro, has shown promise in Phase I trials and is poised for Phase II testing. Its market introduction is anticipated in the 2030s.

The move has generated optimism, reflected in a 2.4% rise in Roche shares, as the weight-loss drug market, potentially worth $100 billion, appears to have room for multiple players. Roche’s Teresa Graham, head of the pharmaceuticals division, expressed ambitions beyond merely competing on price, envisioning CT-388 as a leading obesity drug in its class.

This acquisition marks Roche’s re-entry into the GLP-1 field, following a previous exit in 2018 when subsidiary Chugai sold experimental drug rights to Lilly. The Carmot deal, expected to conclude in early 2024, includes additional payments of up to $400 million subject to achievement of certain milestones.

The deal is part of Roche’s broader strategy, under new CEO Thomas Schinecker, to diversify its therapeutic fields and rejuvenate its development pipeline, especially after setbacks in Alzheimer’s and cancer immunotherapy. Besides the Carmot acquisition, Roche recently committed $7.1 billion for rights to a new drug for inflammatory bowel disease.

Carmot, founded in 2008, has a portfolio of various gut-hormone drug candidates, in both pill and injectable forms, designed to treat obesity in patients with and without diabetes. This acquisition underlines Roche’s commitment to expanding its presence in the evolving field of obesity treatment.

UK’s obesity epidemic costs economy almost £100 billion per year

Britain is grappling with an obesity crisis that is inflicting a staggering economic toll of nearly £100 billion annually, as per a comprehensive report by the Tony Blair Institute. This figure, highlighted in a report published by The Times, indicates that the impact of obesity on national productivity is far more severe than previously estimated, being ninefold higher.

The financial implications are forecasted to escalate by an additional £10 billion over the coming 15 years. This total cost, inclusive of the £63 billion attributed to shorter life spans and compromised health due to obesity, equates to roughly 4% of the nation’s GDP.

Henry Dimbleby, the former government advisor on food, is advocating for stringent measures akin to those applied to tobacco, targeting junk food. He warns that without decisive action, Britain risks becoming a nation burdened by illness and economic decline. Dimbleby is poised to highlight these concerns in a speech at a Royal Society conference, stressing the potential strain on the NHS and consequent economic stagnation.

Amid these warnings, the government has postponed initiatives like the 9pm junk food advertising watershed and restrictions on promotional deals for unhealthy food products until 2025. Health Secretary Victoria Atkins has expressed a desire to offer health guidance in a non-patronising manner.

A Department of Health spokesperson reiterated the government’s commitment to tackling obesity, pointing to initiatives like food-labelling standards, investment in school sports, and healthy food vouchers for underprivileged families.

Hermione Dace from the Tony Blair Institute underscored the critical link between the nation’s health and its economic prosperity, calling for a revamped approach to promote healthier food options and discourage the profitability of ultra-processed and junk food.

The obesity epidemic has intensified, with two-thirds of British adults now classified as having overweight or obesity, a significant rise from half a generation ago. Notably, the average weights of British men and women have increased by 6kg and 5kg, respectively, since 1993.

More than half of the world will have overweight or obesity by 2035 – report

A new report by the World Obesity Federation predicts that more than half of the global population will have overweight or obesity by 2035. The report estimates that by 2035, 2.7 billion adults worldwide will have overweight, and 1.1 billion will have obesity.

The report points out that having overweight or obesity is a significant risk factor for many chronic diseases, including type 2 diabetes, cardiovascular disease, and some types of cancer. The cost of treating these diseases puts a significant burden on healthcare systems worldwide, with the federation estimating it will cost more than $4 trillion annually by 2035, or 3% of global GDP.

The report warns that the COVID-19 pandemic has exacerbated the problem by limiting access to healthy food and exercise opportunities, increasing stress and anxiety, and disrupting healthcare services. People who have overweight or obesity are also more likely to experience severe symptoms or complications from COVID-19.

The report calls for urgent action to address the growing obesity crisis, including measures to promote healthy eating, physical activity, and access to healthcare. It also calls for better regulation of the food industry to ensure that healthy options are available and affordable to all.

The authors of the report note that the obesity crisis is a complex issue that requires a multifaceted response from governments, healthcare providers, and individuals. They stress the importance of a coordinated and sustained effort to prevent and treat obesity, which they believe is essential for the health and well-being of individuals and societies worldwide.

The authors of the report have said they are not blaming individuals, but instead calling for a focus on the societal, environmental, and biological factors involved in the conditions. The report’s findings will be presented to United Nations policymakers and member states next week.

Higher obesity levels linked to lower productivity in England, research shows

Published in The Guardian, “Higher obesity levels linked to lower productivity in England, research shows” discusses the findings of a new study that shows a correlation between obesity levels and lower productivity in England. The study found that people with obesity tend to miss more work days due to health issues and are less productive when they are at work, leading to a loss of economic output for the country. The article notes that the findings of the study have implications for both employers and policymakers, as addressing obesity and promoting healthy lifestyles could lead to improved health and increased productivity for the workforce. The article also highlights the need for comprehensive programs and policies aimed at reducing obesity levels and improving overall health in England.