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 identify, 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 medicine, Ozempic and Wegovy, have soared to superstar standing and helped make the corporate Europe’s most useful public agency. It could possibly’t make sufficient of the medicine.
Mr. Jorgensen’s downside is one many high executives wouldn’t thoughts, however the success caught him off guard. Final 12 months, when the corporate was celebrating its centenary, Novo Nordisk’s income jumped by a 3rd, to 232 billion Danish kroner, or $33 billion.
“No person had forecast this progress — no analyst, no one within the firm,” Mr. Jorgensen mentioned in a current interview on the firm’s headquarters in a suburb of Copenhagen. “No person forecast a 100-year-old firm would develop greater than 30 p.c,” he mentioned, seemingly torn between delight and amazement.
For many of its 100 years Novo Nordisk has been targeted on the regular enterprise of treating diabetes, one of many world’s most prevalent continual illnesses. Even in the present day, it produces half the world’s insulin. However the improvement of Ozempic and Wegovy has led to an even bigger and bolder ambition to “defeat severe 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 p.c of adults are overweight.
And so the Danish drugmaker is present process huge adjustments — it’s getting larger, extra worldwide and nearer to the warmth of the highlight. Mr. Jorgensen is attempting to ramp up manufacturing to fulfill the large demand for its weight-loss medicine, keep forward of competitors from Eli Lilly and others and make sure the firm’s future so it could 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 Means.”
These ideas, which embrace having a “patient-centered enterprise method,” have helped earn the corporate an excellent fame at residence, the place it’s thought of a spot the place individuals are proud to work. However these guideposts are dealing with stress as tens of 1000’s of latest staff 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 staff share an open-plan workplace area.
“Many people have been right here eternally,” Mr. Jorgensen, 57, mentioned as a snowstorm gathered power outdoors.
He’s labored at Novo Nordisk for greater than three many years, and have become chief government in 2017, a turbulent interval when the insulin market was below pressure: “Three revenue warnings in a single 12 months, and the share value had tanked by 40 p.c,” he recalled.
A few 12 months 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 useful firm. Its market worth exceeds $555 billion.
For these on the sixth flooring, who rose by the ranks of an organization that targeting insulin, the adjustments are coming shortly.
“Now it’s new sufferers; a brand new product presentation; generally new molecules,” Mr. Jorgensen mentioned. “It’s a very completely 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 generally known 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 once 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 worry the identical factor.
Semaglutide revived the fortunes of Novo Nordisk. A few many years 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 had been compelled to pay bigger rebates.
Ozempic, the model identify for semaglutide, a weekly injection for Kind 2 diabetes sufferers, has been round for greater than six years. However within 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 on the Oscars final 12 months Jimmy Kimmel made a gag about it. TikTok movies tagged Ozempic have multiple 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 accredited by the Meals and Drug Administration in mid-2021, the Danish firm knew it had “one thing particular,” mentioned Camilla Sylvest, the manager vice chairman for business technique and company affairs.
Novo Nordisk leads the pack in weight problems therapy, however it now has robust competitors from Eli Lilly, which sells an identical drug below the model names Mounjaro, for diabetes, and Zepbound, for weight reduction. Different 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 US. That’s partly as a result of medicine are usually launched first in the US.
Meaning the Danes primarily have People to thank for his or her financial progress. The enlargement of the pharmaceutical business, principally attributable to Novo Nordisk, was liable for all of Denmark’s financial progress final 12 months.
Excessive Costs, Loud Criticism
The price of these medicine, although, has made Novo Nordisk a goal.
“There is no such thing as a rational motive, apart from greed, for Novo Nordisk to cost People almost $1,000 a month for Ozempic,” Senator Bernie Sanders, impartial of Vermont, mentioned final month. A frequent critic of excessive drug costs, he mentioned Canadians paid $155 a month and Germans simply $59.
Ozempic might 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 total well being care system.”
Whereas the U.S. record 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 coverage, and a few have been overwhelmed. This month, dealing with ballooning prices, North Carolina give up offering insurance coverage protection for weight problems medicine for state staff. Even Denmark’s nationwide well being service gained’t subsidize Wegovy, arguing that it isn’t value efficient.
Mr. Jorgensen argues that prime charges of weight problems result in huge medical prices, and that medicine to finish weight problems finally get monetary savings. “Well being care programs are challenged, with getting old populations,” he mentioned. “They’re going to interrupt until we do one thing about weight problems.”
The Novo Nordisk Means
Though the corporate’s manufacturing services function 24 hours a day, three hundred and sixty five 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.
Manufacturing capability is a recurring headache. Novo Nordisk has greater than 64,000 staff, and site visitors jams outdoors its buildings are widespread. On the headquarters in Bagsvaerd, arrivals after 9 a.m. may battle to discover a desk.
So Novo Nordisk is in the course of remaking itself. Cranes and building staff have descended on its websites because it spends greater than $6 billion this 12 months 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 had been employed final 12 months globally, and the corporate is turning into extra worldwide — particularly American — because it expands analysis workplaces 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 coaching known as NNX, for Novo Nordisk Unknown. The important query, he mentioned: “What are your individual self-limiting beliefs that would set off you, block you, in truly daring to guide in a unique setting?”
Since then, greater than 400 managers have been by 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 troublesome selections about learn how to decide who will get what’s accessible.
Ms. Sylvest says right here she is guided by the Novo Nordisk Means, launched within the late Nineties. It contains 10 ideas, like “we’re curious and innovate for the advantage of sufferers and society at giant” and “we construct and keep good relations with our stakeholders.”
“In some way,” she mentioned, “it all the time helps us to have these necessities about what’s the precise 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 current sufferers on the high of the record.
A whole bunch of Thousands and thousands of Potential Sufferers
Till not too long ago, weight problems medicine had a dire historical past, together with when Fen-Phen needed to be pulled off cabinets within the late Nineties for inflicting severe coronary heart issues.
Weight problems was “a therapeutic graveyard,” mentioned Emily Area, a prescription drugs analyst at Barclays in London. The medicine both labored effectively and had unhealthy unintended 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, quite 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 examine it financed confirmed that its medicine might cut back the danger of coronary heart assaults, stroke and heart problems. That is “what actually bought 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 medicines might develop to $100 billion within the subsequent decade, in line with Barclays. To this point, 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 improvement 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 therapy.
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, based mostly on genetics and the information, and deal with them first?
Final 12 months, Novo Nordisk established the Transformational Prevention Unit, an inside staff on the lookout for 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 unfavourable “underperform” score on Novo Nordisk inventory. Peter Welford, an analyst on the financial institution in London, thinks weight problems medicine will turn into widespread and interchangeable, struggling the identical destiny as insulin, with greater volumes and stress on web costs.
“In the end, we predict Novo Nordisk must diversify,” Mr. Welford mentioned. However the financial institution’s guess that Novo Nordisk’s share value is simply too excessive hasn’t labored out to date.
“Clearly we’ve been fallacious,” he mentioned.