Novo Nordisk, the Danish pharma giant, is facing a double-edged sword: soaring demand for its blockbuster weight-loss drug Wegovy and a struggle to keep it stocked. This month, they cautiously increased lower-dose supplies, hoping to ease shortages that have frustrated patients and sent rivals scrambling.
Popularity Paradox: Wegovy's effectiveness has sparked a weight-loss revolution, but the surge in demand caught Novo Nordisk off guard. To protect existing patients, they limited new prescriptions, creating a supply crunch that forced some to seek alternatives like Ozempic, a diabetes drug with the same ingredient, leading to shortages there too.
Scaling Up: Novo Nordisk isn't sitting on its laurels. They're investing a whopping $6 billion to expand production, vowing to double lower-dose availability this year and gradually increase overall supply throughout 2024.
Beyond Supply: The battle isn't just about production. Novo Nordisk is also fighting an insurance coverage war. Many employers balk at the drug's high cost, forcing some patients to navigate complex hurdles. To counter this, Novo is highlighting Wegovy's heart-health benefits, hoping for a mid-year approval to promote them and improve affordability.
Financial Gains: Despite the supply woes, Wegovy and Ozempic are goldmines. Sales of their entire GLP-1 portfolio soared 55% in the last quarter, with Wegovy sales tripling.
Looking Ahead: Novo Nordisk is bullish, projecting sales growth of 18-26% and operating profit growth of 21-29% for 2024. They've also launched a share buyback program and increased dividends.
