By Richa Naidu
LONDON (Reuters) - Nestle on Thursday said it has started work on products to "companion" weight loss drugs like Novo Nordisk (CSE:NOVOb)'s game-changing Wegovy, hoping to cash in on their growing popularity.
The Swiss food giant's CEO Mark Schneider said Nestle had not seen any impact from such drugs on sales so far, referring to the threat they pose to the packaged food industry that has spooked investors in recent weeks.
Nestle shares fell this month after Walmart (NYSE:WMT), the world's biggest retailer, said it saw a slight pullback in food consumption with people taking appetite-suppressing drugs.
"We're working already on a wide range of products that could serve as companion products," Schneider said during an earnings briefing, noting that some supplements can help with the "loss of lean muscle mass" and "rapid regain of weight".
"The largest parts of our portfolio will not be affected" by this new breed of weight loss drugs, he said.
Globally, Nestle's biggest businesses are coffee and pet care, while frozen food, confectionary and ice cream make up 15% of sales.
"We're watching this carefully and will keep you updated," Schneider said.
Wegovy has been shown to help patients reduce body weight by around 15% when used along with exercise and lifestyle changes. It is so far available in the United States, Norway, Denmark and, as of late July, Germany.