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Novo Nordisk expects demand for its weight loss drugs to continue to outstrip supply despite expanding manufacturing capacity, as new trial data bolsters its case that treating obesity has broader health benefits.
Sales of the Danish pharmaceutical group’s obesity and diabetes drugs soared 36 per cent to almost $22bn in the first nine months of the year, as patients flocked to the treatments that offer more significant weight loss than previous medicines.
Novo Nordisk’s chief executive Lars Fruergaard Jørgensen said the company was focused on trying to ensure that patients who start drugs such as Wegovy can continue to access them.
He said the company was “gradually” expanding its manufacturing and expected more products to be available next year. “Despite the fact of that growth, we still see that as a demand side that’s outmatching what we can supply,” he said on a media call.
Wegovy is now covered by insurers for about 50mn Americans, and Jørgensen expects this number to increase.
Initial trial data published in August showed that Wegovy lowered the risk of a serious cardiac event such as a heart attack or stroke by 20 per cent.
If the company receives regulatory approval to expand the use of the drug to those at risk of cardiovascular complications, analysts expect more insurers will pay for the drug.
In the first nine months of the year, sales of obesity drugs such as Wegovy rose 167 per cent to DKr30.4bn ($4.3bn), while revenue from its diabetes drugs including Ozempic, which work in the same way and are often prescribed off-label for weight loss, increased 45 per cent.
Total net sales were DKr166bn, up 29 per cent year on year, and diluted earnings per share rose 49 per cent to DKr13.71.
Earlier this month, Novo Nordisk raised its full-year revenue and profits guidance because of better than expected sales.
The drugmaker expects sales growth in 2023 of 32 to 38 per cent, above its previous prediction of 27 to 33 per cent, at constant exchange rates. It forecasts operating profit growth this year of 40 to 46 per cent, up from previous guidance of 31 to 37 per cent.
Novo Nordisk is the market leader in the obesity and diabetes drugs that use the so-called GLP-1 mechanism, with a 54.3 per cent market share globally.
In the US, its market share slightly declined in the past year, while it increased in international markets as the company launched Wegovy in five European countries including Germany and the UK.
But Novo Nordisk is likely to face increased competition from Eli Lilly, if the US rival’s Mounjaro diabetes drug is also approved for the treatment of obesity. Trial results, which are not always directly comparable, show Mounjaro helped patients lose even more of their body weight than Wegovy.
Jørgensen said the two companies had competed against each other for 100 years in diabetes. “If you have a competitor that’s focused on innovation, it leads to a growing market and it also keeps both companies on their toes. So I think that’s a very, very positive situation to be in,” he said.