From Oreos to Ozempic: Inside the $100bn Free From race

Key takeaways:

• The Free From market has gone mainstream, surpassing $100bn and set to more than double by 2033.
• Big Food players are investing heavily in acquisitions and reformulations to keep iconic brands relevant in the Free From era.
• GLP-1 weight-loss drugs are cutting snack volumes but fueling demand for portion-controlled, protein-rich, and low-sugar innovation.

The Free From label once belonged to specialty shelves tucked away in health food stores. Today, it drives a global market worth well over $100bn in 2025 and forecast to more than double by 2033. What began with gluten-free bread and dairy-free milk has matured into an all-encompassing category spanning cookies, cereals, chips and chocolate, with sugar-free claims now making up about 40% of revenues, according to Future Market Insights.

The appeal is twofold. On one hand, medical need is rising: celiac diagnoses, lactose intolerance, nut allergies and diabetes are all pushing consumers toward alternatives. On the other, the mass market has embraced Free From for wellness reasons. As Harvard Health noted in 2024, “interest and enthusiasm around gluten-free diets continues to grow dramatically” – far beyond those with medical necessity.

This mainstreaming is why giants like PepsiCo, Nestlé, Hershey and Mondelēz are writing big checks and reformulating icons. It’s also why Wall Street is watching the intersection with GLP-1 weight-loss drugs so closely. Appetite suppression could dent traditional snack categories, but it’s also accelerating innovation in portion-controlled, high-protein and low-sugar launches.

Big bets and billion-dollar buyouts

PepsiCo made one of the boldest moves of 2024 when it announced a $1.2bn acquisition of Siete Foods, the Texas-based maker of grain-free tortillas and chips. CEO Ramon Laguarta framed the deal as a strategic leap into inclusive snacking. “This acquisition expands our multicultural portfolio with products that are better for you and rooted in heritage,” he said. The buyout plugs Frito-Lay directly into the booming gluten- and grain-free niche.

Mondelēz has taken a different tack: remaking its own classics. After launching gluten-free Oreo in 2021, the snack giant followed with gluten-free Chips Ahoy in 2024, extending its core cookies into Free From territory. The company is leaning on its Enjoy Life Foods subsidiary for allergen-friendly innovation, while investing in global rollouts of gluten-free lines. It’s a defensive play dressed as innovation – keeping Oreo and Chips Ahoy relevant while luring back consumers who abandoned conventional cookies.

Nestlé is folding Free From directly into its ‘food as medicine’ strategy. In 2024, it launched Vital Pursuit, a frozen line aimed at weight-conscious consumers and GLP-1 users, with gluten-free flatbreads, high-protein bowls and portion-controlled pizzas sold at a mainstream $4.99. “As the use of medications to support weight loss continues to rise, we see an opportunity to serve those consumers,” said Steve Presley, CEO of Nestlé North America. “We’re leveraging our deep understanding of consumers and nutritional science to stay ahead of the trends that are shaping consumer behaviors.” Nestlé Health Science has also launched a GLP-1 Nutrition platform with supplements and advice – proof the company sees the intersection of Free From and wellness as a long-term play.

Confectionery giant Hershey has been expanding in the other direction. Its 2021 acquisition of Lily’s Sweets gave it a platform in stevia-sweetened chocolate. In April 2025, it added popcorn and puff maker LesserEvil for a reported $750m. “By joining The Hershey Company’s family of brands, Lily’s will become a platform [for] better-for-you options accessible to all consumers,” said Lily’s CEO Jane Miller. Hershey’s better-for-you portfolio, which also includes SkinnyPop, now delivers more than a fifth of group sales, according to company filings.

Conagra Brands has leaned into innovation through its Udi’s and Glutino lines. In 2024, Udi’s launched the first multi-serve gluten-free chicken enchilada in the frozen aisle. “One in four consumers seek gluten-free meals, but finding one everyone will enjoy is challenging,” Conagra said in its launch statement. Its Glutino brand has pushed pretzels and sandwich cookies with 30% less sugar than conventional versions, putting Conagra at the center of the reduced-sugar bakery and snack market.

Cereal reformulated, portfolios reshaped

Cereal makers are also reworking formulations to keep pace with Free From demand. General Mills has rolled out more gluten-free Cheerios and Special K variants, while Kellanova has been experimenting with allergen-free granolas and high-fiber blends. With breakfast still a growth battleground, reducing sugar and removing gluten are now part of mainstream R&D pipelines.

Other majors are reshaping portfolios via M&A. Mars expanded its better-for-you credentials with Kind, a pioneer in gluten-free, high-fiber snack bars, and in 2024, cemented its snacking dominance by closing the $35bn Kellanova deal, adding Pringles, Cheez-It and a growing roster of reduced-sugar cereals and allergen-friendly lines. Ferrero has also pushed into the space with its purchase of Nonni’s, a gluten-free biscotti maker.

“Overall, top snack companies are seeking growth through M&A and divestments, focusing on key categories and emerging markets,” reported Euromonitor’s Voice of the Consumer: Lifestyles Survey, fielded January to February 2024. “Health-focused regulations are gaining momentum worldwide, with consumers becoming more health-conscious and more attentive to the health claims and functionality of the snacks they eat. Additionally, 54% actively seek out products with healthy ingredients, including those with reduced sugar, salt, saturated fat, gluten and calories.”

What was once a playground for startups is now firmly a big food battlefield. The cost of entry is high, but the cost of missing out is higher. For companies with legacy treats built on flour, dairy and sugar, failure to offer credible alternatives risks ceding shelf space to agile rivals.

GLP-1 reshapes boardroom strategy

While Free From growth is locked into a multi-billion-dollar trajectory, GLP-1 agonists like Ozempic and Wegovy are injecting new volatility into strategy planning. These drugs suppress appetite and blunt cravings, shrinking snacking occasions and exerting pressure on indulgent categories. In households with a GLP-1 user, grocery spend drops by 5%-11%, with baked goods, chips and sweets taking the biggest hit.

Still, food companies are not retreating – they’re retooling. General Mills sees GLP-1 not only as a potential headwind but as an opening, leaning into products like Cheerios Protein and protein-fortified cookies, and repositioning oats, granola and even cereals as ‘smart snacks’ for users with reduced appetite. GM CEO Jeff Harmening admits that GLP-1s present a headwind in traditional volume, but insists the real opportunity lies in aligning with altered consumer needs.

Other executives are hedging bets. PepsiCo’s Ramon Laguarta told analysts in 2023 the effect is “negligible so far”, though he conceded “a lot of question marks”. At Conagra, CEO Sean Connolly says his R&D teams are modeling future consumption behavior to “rapidly design what the consumer is looking for into our products”. Flowers Foods CEO Ryals McMullian acknowledged “I don’t think anyone fully understands the long-term implications yet,”, but emphasized the need to position portfolios “for success in any environment”.

In practice, companies are already acting. Conagra has launched Healthy Choice meals with a ‘GLP-1 friendly’ label, reflecting smaller portions and protein-forward ingredients. The company also highlights increases in frozen meal purchases among GLP-1 users as proof that convenience foods, when portioned and fortified, can gain traction. Ingredient suppliers are stepping up, too, pushing ultra-high-fiber flours and natural sweeteners to enable lighter but satisfying baked goods. Some categories that rely on impulse and large formats – like full bags of chips – are increasingly vulnerable.

Free From as table stakes

Despite the GLP-1 wildcard, the consensus is that Free From is now the baseline, not a bonus. Euromonitor data show 54% of consumers seek reduced sugar, salt, gluten or fat, and 40% read nutrition labels closely before purchase. For a new generation of shoppers, a clean label and Free From claim are the price of entry.

The market is growing at nearly 13% annually, led by sugar-free. The question is no longer whether to play in Free From but how fast and how credibly companies can scale. The fight for the future of bakery and snacks is already well underway, and the winners will be those who prove that nothing – no sugar, no gluten, no allergens – really is something.