February 27, 2024

Wegovy injections

Novo Nordisk reported on Jan. 31 that its revenue in 2023 jumped 31% to 232.3 billion Danish kroner ($33.8 billion).
Image: Staff (Reuters)

Lars Fruergaard Jorgensen, the CEO of Ozempic and Wegovy maker Novo Nordisk, says that chief executives at food companies are calling him for advice regarding the diabetes and weight loss drugs.

“A couple of CEOs from, say, food companies have been calling me,” Jorgensen told Bloomberg. “They are scared about it.”

He did not disclose the name of the companies.

Ozempic and Wegovy are part of a new class of medications known as GLP-1s that suppress a user’s appetite. Demand for the drugs has skyrocketed in the last year.

Novo Nordisk reported last week that its sales in 2023 jumped 31% to 232.3 billion Danish kroner ($33.8 billion) compared with 177 billion Danish kroner ($25 billion) in 2022. Bloomberg Intelligence forecasts the market for these new weight loss drugs, which also includes Eli Lilly’s Zepbound, could hit $80 billion by 2030.

Wall Street analysts and other business leaders are already looking at what this means for other industries.

A Morgan Stanley survey found that 77% of patients reported visiting fast food restaurants less frequently.

Walmart US CEO John Furner said the company is already noticing changes in consumer behavior from the drugs. He told Bloomberg in October that in comparison to the general population users are buying less things.

On the other hand, executives at Chipotle are hoping users of these drugs will be attracted to their healthier “wholesome” offerings.

Novo Nordisk struggles to keep up with surging Wegovy demand

Novo Nordisk announced Monday that it has bought three facilities from the drug manufacturing company Catalent for $11 billion in an effort to address a shortage of Wegovy. As part of the transaction, the company’s largest shareholder Novo Holdings has agreed to acquire Catalent.

Novo Nordisk said in a statement that the acquisition will increase the company’s production capacity from 2026 and onwards.

Since May 2023, Novo Nordisk has been limiting starter doses of Wegovy to ensure there is enough supply for patients already on the drug.

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