Activia yogurt pots, manufactured by Danone SA, are displayed on display.
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CEO of the French consumer goods giant Danone Amazon has played down the risk of obesity drugs to its nutritional business, arguing that consumers are more likely to turn to healthier products as part of their new weight-loss regime.
Antoine de Saint-Afrique said the increasing demand for medicines such as Wijovi and Mongaro will only increase consumers' appetite for more food products.
“We consider ourselves very complementary to GLP-1s,” de Saint-Afrique told CNBC's Charlotte Reed on Wednesday.
GLP-1s, or glucagon-like peptide 1 agonists, are the primary class of drugs used in weight loss injections like Wegovy and Mounjaro. They work by mimicking appetite-regulating hormones in the body and effectively reducing hunger levels.
The rapid rise of such drugs has raised concern among food makers, who fear sales will decline as consumers' appetites decline. CEO of Wegovy Novo Nordisk He said in February he was fielding calls from “scared” food bosses asking how the new drug category would impact their business.
However, de Saint-Afrique said Danone's products, which include Activia yogurt and Alpro plant-based milk, will be an important component of consumers' new diet.
“We provide protein and protein that you can't find naturally,” he said. “You need those proteins, and if you're on this diet, you're going to miss those proteins. We can bring them in to contribute to your gut health,” he said.
“We are actually at the heart of what is required when using something like GLP-1,” de Saint-Afrique added.
Analysts at financial services research firm Kepler Cheuvreux said in a research note last month that concerns about the impact of GLP-1s on the consumer goods market may be overblown, particularly in the nutritional foods space.
“GLP-1 users may consume fewer calories, but we do not see a material impact on overall food demand, while we see opportunities for food makers from protein products and nutritional supplements,” John Cox, head of European consumer equities, wrote in an article. Note via email.
“While consumers may be avoiding ultra-processed foods (UPFs) that are bad for you, we believe European companies generally have healthier portfolios than some competitors,” he added.
Kepler Chevrot has named Danone and Swiss food maker Nestlé as potential beneficiaries in the new consumer goods landscape. Jefferies also last month named Danone a buy amid a broader downturn in the food sector as consumers cut spending in the face of rising inflation.
