Ozempic and Wegovy have the potential to change the landscape of American public health, but only if we let them. These drugs, which first received public interest as new weight-management instruments for the ultra-rich, are much more than vanity tools. In August, clinical studies found that injections of semaglutide, the primary chemical compound in Ozempic and Wegovy, reduced users’ risk of heart attack by 20% and also prevented strokes and cardiac disease.
Although the effectiveness of these medications has evoked near-universal praise, food and beverage megacorporations aren’t smiling. On Oct. 6, after Walmart observed declining food sales linked to increased semaglutide use, its share price fell 1.68%. In response, Coca-Cola’s and PepsiCo’s stocks plummeted 4.8% and 5.2%, respectively. Once you dry the tears you will inevitably shed for the shrinking dividend of the humble beverage executive, this stock slump is pretty incriminating — the financial interests of processed food giants are directly opposite the well-being of the American people.
None of this is news. Researchers and nutrition experts have long understood that snack foods and sodas are engineered to be addictive. The chemical and nutritional qualities that induce this addictiveness contribute to conditions like diabetes and cardiovascular disease. The astronomical revenues that firms like McDonald’s and Coca-Cola enjoy are contingent on binge-eating habits and frequent purchases from repeat customers. Both of these behaviors are mitigated by the effects of Ozempic and Wegovy, which mimic hormones that make the brain less hungry.
The present expense of these drugs is consistent with their effectiveness. As of September, a month’s supply of Ozempic costs $900; Wegovy came in lower at the unaffordable monthly price of $270. And yet, the benefits of the pharmaceuticals may still be worth subsidizing. Beyond the obvious quality-of-life upgrade that many recipients would enjoy, America’s obesity epidemic is an economic catastrophe. Medical costs necessitated by patient obesity cost between $147 billion and $210 billion on an annual basis, and associated losses in productivity are costly as well. Whatever the exact value calculation of a public provision may be, the funds will need to come from somewhere.
To finance the supply of weight-loss drugs, policymakers should turn to the sales that rendered them necessary in the first place. An excise tax on the sale of all sodas, processed snack foods and other highly unhealthy products would produce substantial tax revenues with money taken from exploitative companies. Think of it like a cigarette tax. After all, junk food causes more annual deaths in the United States than cigarettes. The determination of the exact tax rate and the exact products to tax should be made by experts, but the disincentive should be large.
Establishment economists may balk at this suggestion, but the situation at hand is a demonstration of the occasional pitfalls of the free market principles they espouse. Any potential outcome of the tax would benefit the consumer. If higher prices as a consequence of the tax lead fewer customers to buy junk food, the consumer’s health wins in the long-run; if demand persists but tax revenues fund drug purchases, the consumer’s health wins too. Opponents may cry that taxes on soda and chips hurt small business owners — this is a bad-faith argument. Walmart alone sells 25.2% of all groceries in the United States, and competitors like Target, Food Lion, Publix and others make up most of the rest of the pie. Decreased revenues from food sales would primarily hurt big businesses and level the economic playing field.
Whether such a tax was implemented at the municipal, state or federal level is less important than its implementation for a sufficiently large share of the population. Evanston is uniquely positioned to lead the charge as a city with a history of progressive and pioneering legislation.
A junk food tax could look much like the local cigarette tax: at present, Evanston adds a $0.50 tax to the $6 Cook County and Illinois tax on every pack sold within the city. Because state and county junk food taxes do not yet exist, Evanston could open the policy with an extra $1 tax on every 12-pack of soda or every bag of snack chips.
There are plenty of questions regarding such a tax that would need to be fleshed out in legislative sessions. States with more robust public healthcare infrastructures like Massachusetts may find it easier to introduce such a tax. Raising the effective price of the cheapest available food products may prove to be a burden on individuals and families with less disposable income. All of these considerations ought to be left to policymakers and thus their electors.
However, the need for some version of the tax is clear. The public will need cheap and available semaglutide, and nobody should pay for it before the junk food giants pull their own weight.
Source : Daily North Western
