Lars Fruergaard Jorgensen has an issue: Too many individuals need what he’s promoting.
Mr. Jorgensen is the chief government of Novo Nordisk, the Danish drugmaker. Even if the firm isn’t fairly a family title, the TV jingle for its best-selling drug — “Oh-oh-ohhh, Ozempic!” — would possibly ring in your ears. Across the United States, Novo Nordisk’s diabetes and weight-loss medication, Ozempic and Wegovy, have soared to superstar standing and helped make the firm Europe’s most respected public firm. It can’t make sufficient of the medication.
Mr. Jorgensen’s drawback is one many prime executives wouldn’t thoughts, however the success caught him off guard. Last 12 months, when the firm was celebrating its centenary, Novo Nordisk’s income jumped by a 3rd, to 232 billion Danish kroner, or $33 billion.
“Nobody had forecast this growth — no analyst, nobody in the company,” Mr. Jorgensen mentioned in a latest interview at the firm’s headquarters in a suburb of Copenhagen. “Nobody forecast a 100-year-old company would grow more than 30 percent,” he mentioned, seemingly torn between pleasure and amazement.
For most of its 100 years Novo Nordisk has been centered on the regular enterprise of treating diabetes, one in all the world’s most prevalent persistent ailments. Even at this time, it produces half the world’s insulin. But the improvement of Ozempic and Wegovy has led to an even bigger and bolder ambition to “defeat serious chronic diseases.” That consists of treating, and even stopping, weight problems, which is linked to different health points like coronary heart and kidney ailments.
By pursuing a a lot bigger goal than diabetes, the firm expects to unlock the door to a multibillion-dollar market with almost a billion potential sufferers. In the United States alone, greater than 40 % of adults are overweight.
And so the Danish drugmaker is present process huge adjustments — it’s getting greater, extra worldwide and nearer to the warmth of the highlight. Mr. Jorgensen is attempting to ramp up manufacturing to fulfill the enormous demand for its weight-loss medication, keep forward of competitors from Eli Lilly and others and guarantee the firm’s future so it might probably meet its lofty aim.
But in all the tumult, there’s something executives try to carry on to: the firm’s longstanding values, codified in the “Novo Nordisk Way.”
Those ideas, which embrace having a “patient-centered business approach,” have helped earn the firm a great fame at dwelling, the place it’s thought-about a spot the place persons are proud to work. But these guideposts are dealing with pressure as tens of hundreds of latest workers are employed, lawmakers denounce the drugmaker for its high costs and counterfeit variations of its merchandise make individuals sick.
#Ozempic
The drugmaker’s head workplace is a homage to its roots: a contemporary six-story white round building impressed by the molecular construction of insulin. A staircase spirals round an open atrium. On the prime ground, Mr. Jorgensen and the government workforce share an open-plan workplace area.
“Many of us have been here forever,” Mr. Jorgensen, 57, mentioned as a snowstorm gathered strength exterior.
He’s labored at Novo Nordisk for greater than three many years, and turned chief government in 2017, a turbulent interval when the insulin market was beneath pressure: “Three profit warnings in one year, and the share price had tanked by 40 percent,” he recalled.
About a 12 months later, Ozempic hit the market.
Now Novo Nordisk constantly beats investor expectations. Last summer time, it eclipsed the French luxurious group LVMH Moët Hennessy Louis Vuitton to grow to be Europe’s most respected firm. Its market worth exceeds $555 billion.
For these on the sixth ground, who rose by the ranks of an organization that focused on insulin, the adjustments are coming rapidly.
“Now it’s new patients; a new product presentation; sometimes new molecules,” Mr. Jorgensen mentioned. “It’s a completely different, say, management system and supply chain that’s required.”
The coronary heart of the development is semaglutide, Novo Nordisk’s artificial model of a hormone generally known as glucagon-like peptide 1, or GLP-1, which helps the body regulate blood sugar ranges. The patent developed by the firm additionally proved remarkably efficient for weight loss. It causes individuals to really feel fuller once they eat and reduces cravings. Physicians say it may revolutionize the means we take into consideration weight problems and what we eat; food executives concern the similar factor.
Semaglutide revived the fortunes of Novo Nordisk. A few many years in the past, the firm was falling behind worldwide friends, with failed insulin medical trials and too little innovation. And then insulin started drying up as a supply of earnings, as U.S. lawmakers pushed value caps and drugmakers have been pressured to pay bigger rebates.
Ozempic, the model title for semaglutide, a weekly injection for Type 2 diabetes sufferers, has been round for greater than six years. But in the final couple of years, there was an explosion in reputation, helped alongside by heavy promoting, social media movies and intrigue over superstar use. Elon Musk mentioned he used it, and at the Oscars final 12 months Jimmy Kimmel made a gag about it. TikTok movies tagged Ozempic have a couple of billion views, with individuals documenting their weight loss.
As Ozempic started to take off, Novo Nordisk pushed forward with Wegovy, which is semaglutide marketed particularly for weight loss. By the time it was authorised by the Food and Drug Administration in mid-2021, the Danish firm knew it had “something special,” mentioned Camilla Sylvest, the government vp for industrial technique and company affairs.
Novo Nordisk leads the pack in weight problems remedy, however it now has robust competitors from Eli Lilly, which sells an analogous drug beneath the model names Mounjaro, for diabetes, and Zepbound, for weight loss. Other pharmaceutical corporations are clambering to catch up.
By far, most individuals utilizing Ozempic (two thirds of its gross sales final 12 months) and Wegovy (almost all of its gross sales) are in the United States. That’s partly as a result of medication are typically launched first in the United States.
That means the Danes primarily have Americans to thank for his or her financial development. The enlargement of the pharmaceutical trade, largely as a consequence of Novo Nordisk, was accountable for all of Denmark’s financial development final 12 months.
High Prices, Loud Criticism
The value of those medication, although, has made Novo Nordisk a goal.
“There is no rational reason, other than greed, for Novo Nordisk to charge Americans nearly $1,000 a month for Ozempic,” Senator Bernie Sanders, impartial of Vermont, mentioned final month. A frequent critic of high drug costs, he mentioned Canadians paid $155 a month and Germans simply $59.
Ozempic might be a “game changer” combating diabetes and weight problems, Mr. Sanders added, however “this outrageously high price has the potential to bankrupt Medicare, the American people and our entire health care system.”
While the U.S. record value for Ozempic is a little bit beneath $1,000 a month and about $1,350 for Wegovy, Novo Nordisk says most American sufferers pay $25 or much less for Wegovy. Much of the remainder of the value is shouldered by insurance policy, and some have been overwhelmed. This month, dealing with ballooning prices, North Carolina give up offering insurance coverage protection for weight problems medication for state workers. Even Denmark’s nationwide health service received’t subsidize Wegovy, arguing that it isn’t value efficient.
Mr. Jorgensen argues that high charges of weight problems result in monumental medical prices, and that medication to finish weight problems finally get monetary savings. “Health care systems are challenged, with aging populations,” he mentioned. “They’re going to break unless we do something about obesity.”
The Novo Nordisk Way
Although the firm’s manufacturing amenities function 24 hours a day, 365 days a 12 months, the restricted provide of Ozempic and Wegovy is predicted to final for a number of extra years, worrying diabetics whereas counterfeits are leaking into the market.
Production capability is a recurring headache. Novo Nordisk has greater than 64,000 workers, and visitors jams exterior its buildings are widespread. At the headquarters in Bagsvaerd, arrivals after 9 a.m. would possibly battle to discover a desk.
So Novo Nordisk is in the center of remaking itself. Cranes and development employees have descended on its websites because it spends greater than $6 billion this 12 months to broaden manufacturing, almost 4 instances the quantity it spent simply two years in the past. The firm is buying more production sites and vacuuming up workplace area in Denmark.
More than 10,000 individuals have been employed final 12 months globally, and the firm is changing into extra worldwide — particularly American — because it expands analysis places of work in Cambridge, Mass., and buys smaller biotech corporations.
Mr. Jorgensen can be attempting to remodel the mind-set inside the firm. A few years in the past, he gathered executives on a retreat for training referred to as NNX, for Novo Nordisk Unknown. The essential query, he mentioned: “What are your own self-limiting beliefs that could trigger you, block you, in actually daring to lead in a different environment?”
Since then, greater than 400 managers have been by this program, meant to assist them sustain with the firm’s sudden development.
Until drug provides can higher match demand, the firm says, it must make troublesome selections about the right way to decide who will get what’s out there.
Ms. Sylvest says right here she is guided by the Novo Nordisk Way, launched in the late 1990s. It consists of 10 ideas, like “we are curious and innovate for the benefit of patients and society at large” and “we build and maintain good relations with our stakeholders.”
“One way or the other,” she mentioned, “it always helps us to have these essentials about what’s the right thing to do.”
Novo Nordisk, she added, doesn’t wish to simply promote the place costs are highest — the United States — however broaden entry internationally for low-income individuals or these with inadequate insurance coverage, whereas additionally preserving present sufferers at the prime of the record.
Hundreds of Millions of Potential Patients
Until just lately, weight problems medication had a dire historical past, together with when Fen-Phen needed to be pulled off cabinets in the late 1990s for inflicting critical coronary heart issues.
Obesity was “a therapeutic graveyard,” mentioned Emily Field, a prescription drugs analyst at Barclays in London. The medication both labored properly and had unhealthy unwanted side effects or led to solely middling weight loss, she mentioned.
But the science has modified quickly, together with public opinion on weight problems, which is more and more understood to be a illness that may be medically handled, somewhat than a failure of willpower and poor eating regimen.
Novo Nordisk is accountable for a few of this altering outlook. Last summer time, a five-year research it financed confirmed that its medication may scale back the threat of coronary heart assaults, stroke and heart problems. This is “what really got Novo Nordisk on the radar,” Ms. Field mentioned.
That makes a whole bunch of thousands and thousands of individuals potential sufferers. The marketplace for weight problems medicines may develop to $100 billion in the subsequent decade, in line with Barclays. So far, Novo Nordisk is treating about 40 million individuals globally with its diabetes and weight-loss remedies.
The End of Obesity?
The U.S. patents on Ozempic and Wegovy don’t expire till 2032, however already Novo Nordisk is engaged on new remedies. It’s in superior improvement of CagriSema, a weekly injection that’s anticipated to be more practical than Wegovy for shedding weight. Last month, its inventory value spiked after early trial outcomes for an oral pill of one other weight-loss remedy.
As the firm digs deeper into weight problems, which is outlined as having a body mass index above 30, the subsequent query is whether or not the Danish drugmaker can stop weight problems. Can it predict who’s in danger, primarily based on genetics and the knowledge, and deal with them first?
Last 12 months, Novo Nordisk established the Transformational Prevention Unit, an inside workforce in search of methods to foretell and stop weight problems.
Not everyone seems to be shopping for the hype. For greater than 4 years, Jefferies has had a unfavorable “underperform” score on Novo Nordisk inventory. Peter Welford, an analyst at the financial institution in London, thinks weight problems medication will grow to be widespread and interchangeable, struggling the similar destiny as insulin, with larger volumes and pressure on web costs.
“Ultimately, we think Novo Nordisk needs to diversify,” Mr. Welford mentioned. But the financial institution’s guess that Novo Nordisk’s share value is simply too high hasn’t labored out to this point.
“Clearly we’ve been wrong,” he mentioned.
