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 when the corporate isn’t fairly a family title, the TV jingle for its best-selling drug — “Oh-oh-ohhh, Ozempic!” — may ring in your ears. Throughout the US, Novo Nordisk’s diabetes and weight-loss medication, Ozempic and Wegovy, have soared to superstar standing and helped make the corporate Europe’s most dear public agency. It will probably’t make sufficient of the medication.
Mr. Jorgensen’s drawback is one many high executives wouldn’t thoughts, however the success caught him off guard. Final yr, when the corporate was celebrating its centenary, Novo Nordisk’s income jumped by a 3rd, to 232 billion Danish kroner, or $33 billion.
“No one had forecast this progress — no analyst, no one within the firm,” Mr. Jorgensen mentioned in a latest interview on the firm’s headquarters in a suburb of Copenhagen. “No one forecast a 100-year-old firm would develop greater than 30 %,” he mentioned, seemingly torn between satisfaction and amazement.
For many of its 100 years Novo Nordisk has been centered on the regular enterprise of treating diabetes, one of many world’s most prevalent continual illnesses. Even at this time, it produces half the world’s insulin. However the growth of Ozempic and Wegovy has led to a much bigger and bolder ambition to “defeat critical continual illnesses.” That features treating, and even stopping, weight problems, which is linked to different well being points like coronary heart and kidney illnesses.
By pursuing a a lot bigger goal than diabetes, the corporate expects to unlock the door to a multibillion-dollar market with almost a billion potential sufferers. In the US 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 making an attempt to ramp up manufacturing to fulfill the massive demand for its weight-loss medication, keep forward of competitors from Eli Lilly and others and make sure the firm’s future so it may well meet its lofty objective.
However in all of the tumult, there’s something executives try to carry on to: the corporate’s longstanding values, codified within the “Novo Nordisk Manner.”
These ideas, which embody having a “patient-centered enterprise method,” have helped earn the corporate a very good repute at house, the place it’s thought-about a spot the place individuals are proud to work. However these guideposts are dealing with stress as tens of 1000’s of recent workers are employed, lawmakers denounce the drugmaker for its excessive costs and counterfeit variations of its merchandise make folks sick.
#Ozempic
The drugmaker’s head workplace is a homage to its roots: a contemporary six-story white round constructing impressed by the molecular construction of insulin. A staircase spirals round an open atrium. On the highest flooring, Mr. Jorgensen and the manager group share an open-plan workplace area.
“Many people have been right here eternally,” Mr. Jorgensen, 57, mentioned as a snowstorm gathered energy exterior.
He’s labored at Novo Nordisk for greater than three a long time, and have become chief government in 2017, a turbulent interval when the insulin market was below pressure: “Three revenue warnings in a single yr, and the share value had tanked by 40 %,” he recalled.
A couple of yr later, Ozempic hit the market.
Now Novo Nordisk constantly beats investor expectations. Final summer time, it eclipsed the French luxurious group LVMH Moët Hennessy Louis Vuitton to turn into Europe’s most dear firm. Its market worth exceeds $555 billion.
For these on the sixth flooring, who rose via the ranks of an organization that targeting insulin, the adjustments are coming shortly.
“Now it’s new sufferers; a brand new product presentation; typically new molecules,” Mr. Jorgensen mentioned. “It’s a very totally different, say, administration system and provide chain that’s required.”
The guts of the expansion is semaglutide, Novo Nordisk’s artificial model of a hormone referred to as glucagon-like peptide 1, or GLP-1, which helps the physique regulate blood sugar ranges. The patent developed by the corporate additionally proved remarkably efficient for weight reduction. It causes folks to really feel fuller after they eat and reduces cravings. Physicians say it might revolutionize the best way we take into consideration weight problems and what we eat; meals executives concern the identical factor.
Semaglutide revived the fortunes of Novo Nordisk. A few a long time in the past, the corporate was falling behind worldwide friends, with failed insulin medical trials and too little innovation. After which insulin began drying up as a supply of earnings, as U.S. lawmakers pushed value caps and drugmakers have been compelled to pay bigger rebates.
Ozempic, the model title for semaglutide, a weekly injection for Sort 2 diabetes sufferers, has been round for greater than six years. However within the final couple of years, there was an explosion in recognition, helped alongside by heavy promoting, social media movies and intrigue over superstar use. Elon Musk mentioned he used it, and on the Oscars final yr Jimmy Kimmel made a gag about it. TikTok movies tagged Ozempic have a couple of billion views, with folks documenting their weight reduction.
As Ozempic started to take off, Novo Nordisk pushed forward with Wegovy, which is semaglutide marketed particularly for weight reduction. By the point it was accepted by the Meals and Drug Administration in mid-2021, the Danish firm knew it had “one thing particular,” mentioned Camilla Sylvest, the manager vp for industrial technique and company affairs.
Novo Nordisk leads the pack in weight problems remedy, but it surely now has sturdy competitors from Eli Lilly, which sells an analogous drug below the model names Mounjaro, for diabetes, and Zepbound, for weight reduction. Different pharmaceutical firms are clambering to catch up.
By far, most individuals utilizing Ozempic (two thirds of its gross sales final yr) and Wegovy (almost all of its gross sales) are in the US. That’s partly as a result of medication are typically launched first in the US.
Which means the Danes basically have People to thank for his or her financial progress. The growth of the pharmaceutical business, largely as a result of Novo Nordisk, was liable for all of Denmark’s financial progress final yr.
Excessive Costs, Loud Criticism
The price of these medication, although, has made Novo Nordisk a goal.
“There isn’t any rational cause, apart from greed, for Novo Nordisk to cost People almost $1,000 a month for Ozempic,” Senator Bernie Sanders, unbiased of Vermont, mentioned final month. A frequent critic of excessive drug costs, he mentioned Canadians paid $155 a month and Germans simply $59.
Ozempic could possibly be a “recreation changer” combating diabetes and weight problems, Mr. Sanders added, however “this outrageously excessive value has the potential to bankrupt Medicare, the American folks and our whole well being care system.”
Whereas the U.S. checklist value for Ozempic is a little bit below $1,000 a month and about $1,350 for Wegovy, Novo Nordisk says most American sufferers pay $25 or much less for Wegovy. A lot of the remainder of the associated fee is shouldered by insurance policy, and a few 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 well being service received’t subsidize Wegovy, arguing that it isn’t price efficient.
Mr. Jorgensen argues that top charges of weight problems result in huge medical prices, and that medication to finish weight problems in the end get monetary savings. “Well being care techniques are challenged, with getting older populations,” he mentioned. “They’re going to interrupt except we do one thing about weight problems.”
The Novo Nordisk Manner
Though the corporate’s manufacturing amenities function 24 hours a day, 12 months a yr, 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.
Manufacturing capability is a recurring headache. Novo Nordisk has greater than 64,000 workers, and site visitors jams exterior its buildings are frequent. On the headquarters in Bagsvaerd, arrivals after 9 a.m. may wrestle to discover a desk.
So Novo Nordisk is in the midst of remaking itself. Cranes and building employees have descended on its websites because it spends greater than $6 billion this yr to increase manufacturing, almost 4 occasions the quantity it spent simply two years in the past. The corporate is shopping for extra manufacturing websites and vacuuming up workplace area in Denmark.
Greater than 10,000 folks have been employed final yr globally, and the corporate is changing into extra worldwide — particularly American — because it expands analysis workplaces in Cambridge, Mass., and buys smaller biotech firms.
Mr. Jorgensen can also be making an attempt to rework the mind-set inside the firm. A few years in the past, he gathered executives on a retreat for coaching referred to as NNX, for Novo Nordisk Unknown. The important query, he mentioned: “What are your individual self-limiting beliefs that might set off you, block you, in truly daring to steer in a special setting?”
Since then, greater than 400 managers have been via this program, meant to assist them sustain with the corporate’s sudden progress.
Till drug provides can higher match demand, the corporate says, it must make tough decisions about the way to decide who will get what’s accessible.
Ms. Sylvest says right here she is guided by the Novo Nordisk Manner, launched within the late Nineteen Nineties. It contains 10 ideas, like “we’re curious and innovate for the good thing about sufferers and society at massive” and “we construct and preserve good relations with our stakeholders.”
“Somehow,” she mentioned, “it at all times helps us to have these necessities about what’s the best factor to do.”
Novo Nordisk, she added, doesn’t wish to simply promote the place costs are highest — the US — however increase entry internationally for low-income folks or these with inadequate insurance coverage, whereas additionally preserving present sufferers on the high of the checklist.
Tons of of Thousands and thousands of Potential Sufferers
Till not too long ago, weight problems medication had a dire historical past, together with when Fen-Phen needed to be pulled off cabinets within the late Nineteen Nineties for inflicting critical coronary heart issues.
Weight problems was “a therapeutic graveyard,” mentioned Emily Area, a prescription drugs analyst at Barclays in London. The medication both labored nicely and had dangerous unwanted effects or led to solely middling weight reduction, she mentioned.
However 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, relatively than a failure of willpower and poor eating regimen.
Novo Nordisk is liable for a few of this altering outlook. Final summer time, a five-year research it financed confirmed that its medication might scale back the danger of coronary heart assaults, stroke and heart problems. That is “what actually obtained Novo Nordisk on the radar,” Ms. Area mentioned.
That makes a whole bunch of tens of millions of individuals potential sufferers. The marketplace for weight problems drugs might develop to $100 billion within the subsequent decade, in keeping with Barclays. Thus far, Novo Nordisk is treating about 40 million folks globally with its diabetes and weight-loss remedies.
The Finish of Weight problems?
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 growth of CagriSema, a weekly injection that’s anticipated to be simpler than Wegovy for shedding weight. Final month, its inventory value spiked after early trial outcomes for an oral pill of one other weight-loss remedy.
As the corporate digs deeper into weight problems, which is outlined as having a physique mass index above 30, the subsequent query is whether or not the Danish drugmaker can forestall weight problems. Can it predict who’s in danger, primarily based on genetics and the information, and deal with them first?
Final yr, Novo Nordisk established the Transformational Prevention Unit, an inside group in search of methods to foretell and forestall weight problems.
Not everyone seems to be shopping for the hype. For greater than 4 years, Jefferies has had a destructive “underperform” ranking on Novo Nordisk inventory. Peter Welford, an analyst on the financial institution in London, thinks weight problems medication will turn into frequent and interchangeable, struggling the identical destiny as insulin, with greater volumes and stress on web costs.
“In the end, we expect Novo Nordisk must diversify,” Mr. Welford mentioned. However the financial institution’s wager that Novo Nordisk’s share value is simply too excessive hasn’t labored out thus far.
“Clearly we’ve been unsuitable,” he mentioned.
