Most valuable company in Europe
Appetite for weight loss injection bolsters Novo Nordisk cash register
November 2, 2023, 4:42 p.m
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The pharmaceutical company continues to make great money from its weight loss injection – and yet cannot meet demand. The Danes are reporting record sales and operating results for the summer. With the prospect of additional medical benefits, there could be even more in the future.
The Danish drug manufacturer Novo Nordisk is on a record course thanks to booming business with its weight loss injection Wegovy. “We assume that demand will continue to exceed supply in the short to medium term,” said CEO Lars Fruergaard Jorgensen. In the summer quarter, annual revenue rose by 29 percent to 58.7 billion Danish kroner (7.9 billion euros). The operating result (EBIT) increased by a third to 26.9 billion crowns. The company set records for both indicators – also thanks to strong business with the diabetes drug Ozempic, which, like Wegovy, contains the appetite-suppressing active ingredient semaglutide. The group raised its annual targets for the third time in a row in October. The bottom line was that at 22.5 billion crowns, almost 60 percent more.
Novo Nordisk expects another year of double-digit sales growth for its two top drugs. However, Jorgensen warned that the shortages at Wegovy would continue in the short to medium term. Since the company cannot satisfy the appetite for the weight loss injection, the number of patients who can start treatment is still limited. “While delivery capacity for Wegovy is gradually expanding, supply of the lower doses in the U.S. remains limited to ensure continued supply,” the company said.
In August, Novo said restrictions on new patients in the US that began in May would likely last until 2024. Given Wegovy’s limited supply, obesity patients have switched to the diabetes drug Ozempic because both drugs contain the same active ingredient. This has also led to a shortage of Ozempic among patients who need it to treat their diabetes.
Effect on heart diseases
The weight loss injection, which came onto the market in mid-2021 in the USA and in Germany in the summer, not only helped Novo achieve record sales, but also made it the most valuable European listed company ahead of the luxury goods group LVMH. The market for obesity medications is currently growing rapidly. The enormous demand for the weight-loss treatments could spawn up to 10 competing products with annual sales of up to $100 billion within a decade, especially in the United States, according to experts.
In August, Novo published highly anticipated new study data that showed that the weight loss injection could have clear medical benefits in addition to weight loss. In a clinical trial, the drug reduced the risk of a serious cardiovascular event – such as stroke and heart attack – by 20 percent.
At Novo, this is fueling hopes that the data could free Wegovy from the image of a lifestyle drug. The group said in its quarterly financial statements that it had submitted applications to authorities in the United States and the European Union in September and October for approval of Wegovy to reduce the risk of cardiovascular events. According to Novo, the US Food and Drug Administration (FDA) has granted the application priority review.
The group employs 61,400 people in 80 countries and contributes enormously to Danish economic performance.