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 USA, Novo Nordisk’s diabetes and weight-loss medication, Ozempic and Wegovy, have soared to movie star standing and helped make the corporate Europe’s most respected public agency. It might probably’t make sufficient of the medication.
Mr. Jorgensen’s downside 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 stated 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 p.c,” he stated, seemingly torn between pleasure 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 persistent illnesses. Even right this moment, it produces half the world’s insulin. However the improvement of Ozempic and Wegovy has led to a much bigger and bolder ambition to “defeat critical persistent 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 USA alone, greater than 40 p.c of adults are overweight.
And so the Danish drugmaker is present process huge modifications — it’s getting larger, extra worldwide and nearer to the warmth of the highlight. Mr. Jorgensen is attempting to ramp up manufacturing to satisfy the large demand for its weight-loss medication, keep forward of competitors from Eli Lilly and others and make sure the firm’s future so it will probably meet its lofty objective.
However in all of the tumult, there’s something executives are attempting to carry on to: the corporate’s longstanding values, codified within the “Novo Nordisk Method.”
These rules, which embrace having a “patient-centered enterprise strategy,” have helped earn the corporate a superb fame at dwelling, the place it’s thought-about a spot the place persons are proud to work. However these guideposts are dealing with stress as tens of 1000’s of latest workers are employed, lawmakers denounce the drugmaker for its excessive 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 constructing impressed by the molecular construction of insulin. A staircase spirals round an open atrium. On the highest flooring, Mr. Jorgensen and the manager crew share an open-plan workplace area.
“Many people have been right here perpetually,” Mr. Jorgensen, 57, stated as a snowstorm gathered power 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 underneath pressure: “Three revenue warnings in a single yr, and the share worth had tanked by 40 p.c,” he recalled.
A few yr later, Ozempic hit the market.
Now Novo Nordisk persistently beats investor expectations. Final summer season, it eclipsed the French luxurious group LVMH Moët Hennessy Louis Vuitton to turn into Europe’s most respected firm. Its market worth exceeds $555 billion.
For these on the sixth flooring, who rose by the ranks of an organization that focused on insulin, the modifications are coming shortly.
“Now it’s new sufferers; a brand new product presentation; typically new molecules,” Mr. Jorgensen stated. “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 individuals 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 income, as U.S. lawmakers pushed worth caps and drugmakers had been pressured 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 movie star use. Elon Musk stated he used it, and on the Oscars final yr Jimmy Kimmel made a gag about it. TikTok movies tagged Ozempic have multiple billion views, with individuals 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,” stated Camilla Sylvest, the manager vice chairman for industrial technique and company affairs.
Novo Nordisk leads the pack in weight problems therapy, nevertheless it now has robust competitors from Eli Lilly, which sells the same drug underneath 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 yr) and Wegovy (almost all of its gross sales) are in the USA. That’s partly as a result of medication are usually launched first in the USA.
Meaning the Danes primarily have Individuals to thank for his or her financial progress. The growth of the pharmaceutical business, largely as a result of Novo Nordisk, was accountable 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 is no such thing as a rational cause, apart from greed, for Novo Nordisk to cost Individuals almost $1,000 a month for Ozempic,” Senator Bernie Sanders, unbiased of Vermont, stated final month. A frequent critic of excessive drug costs, he stated Canadians paid $155 a month and Germans simply $59.
Ozempic may very well be a “sport changer” combating diabetes and weight problems, Mr. Sanders added, however “this outrageously excessive worth has the potential to bankrupt Medicare, the American individuals and our complete well being care system.”
Whereas the U.S. record worth for Ozempic is just a little underneath $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 medication for state workers. Even Denmark’s nationwide well being service received’t subsidize Wegovy, arguing that it isn’t value efficient.
Mr. Jorgensen argues that top charges of weight problems result in huge medical prices, and that medication to finish weight problems finally lower your expenses. “Well being care programs are challenged, with getting older populations,” he stated. “They’re going to interrupt until we do one thing about weight problems.”
The Novo Nordisk Method
Though the corporate’s manufacturing amenities function 24 hours a day, 12 months a yr, the restricted provide of Ozempic and Wegovy is anticipated 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 widespread. 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 instances 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 individuals had 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 corporations.
Mr. Jorgensen can be attempting to remodel the mind-set throughout 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 stated: “What are your personal self-limiting beliefs that might set off you, block you, in truly daring to guide in a special setting?”
Since then, greater than 400 managers have been by this program, supposed 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 easy methods to decide who will get what’s out there.
Ms. Sylvest says right here she is guided by the Novo Nordisk Method, launched within the late Nineteen Nineties. It contains 10 rules, like “we’re curious and innovate for the advantage of sufferers and society at massive” and “we construct and keep good relations with our stakeholders.”
“By hook or by crook,” she stated, “it all the time helps us to have these necessities about what’s the suitable factor to do.”
Novo Nordisk, she added, doesn’t wish to simply promote the place costs are highest — the USA — however increase entry internationally for low-income individuals or these with inadequate insurance coverage, whereas additionally protecting current sufferers on the high of the record.
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,” stated Emily Subject, a prescription drugs analyst at Barclays in London. The medication both labored properly and had dangerous negative effects or led to solely middling weight reduction, she stated.
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, reasonably than a failure of willpower and poor food regimen.
Novo Nordisk is accountable for a few of this altering outlook. Final summer season, a five-year examine it financed confirmed that its medication might scale back the chance of coronary heart assaults, stroke and heart problems. That is “what actually obtained Novo Nordisk on the radar,” Ms. Subject stated.
That makes a whole lot of tens of millions of individuals potential sufferers. The marketplace for weight problems medicines might develop to $100 billion within the subsequent decade, based on Barclays. To date, Novo Nordisk is treating about 40 million individuals 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 more practical than Wegovy for shedding weight. Final month, its inventory worth 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 yr, Novo Nordisk established the Transformational Prevention Unit, an inside crew searching for 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 damaging “underperform” score on Novo Nordisk inventory. Peter Welford, an analyst on the financial institution in London, thinks weight problems medication will turn into widespread and interchangeable, struggling the identical destiny as insulin, with larger volumes and stress on web costs.
“Finally, we predict Novo Nordisk must diversify,” Mr. Welford stated. However the financial institution’s guess that Novo Nordisk’s share worth is just too excessive hasn’t labored out up to now.
“Clearly we’ve been fallacious,” he stated.
