Thursday, August 31, 2023

Sales Of Weight Loss Drugs Ozempic and Wegovy Now Account For Most Of Denmark's Economic Growth

Good timing, what with Ørsted having big problems in the wind farm biz. More on timing after the jump.

From the New York Times, August 28:

How Ozempic and Weight Loss Drugs Are Reshaping This Country’s Economy
Novo Nordisk, the Danish company behind two popular obesity medications, is reaping huge profits and is now responsible for most of Denmark’s economic growth.
After 100 years of relatively quiet existence as a maker of diabetes drugs, the Danish firm Novo Nordisk has suddenly grown so big that the company is reshaping the Danish economy. 
The reason: Ozempic and Wegovy, two weight loss drugs made by Novo Nordisk that have been proclaimed as revolutionary in the field of obesity.

The company’s booming success now explains almost all of Denmark’s recent economic growth, and the surge in overseas sales in the drugs is prompting the Danish central bank to keep interest rates lower than it otherwise would, economists say. In the past few weeks, Novo Nordisk’s market value has exceeded the size of the Danish economy. Its soaring share price has made it the second most valuable public company in Europe, after the luxury goods group LVMH.

The company’s shadow is so expansive that Danish economists are now debating whether the country needs to publish another set of economic statistics that strips out Novo Nordisk. In other words, there’s Novo Nordisk, and there’s the rest of the economy.

While Denmark, a country of under six million people, is no stranger to globally significant companies, such as Lego and the shipping giant Maersk, the impact of Novo Nordisk on economic statistics is unique, economists say. 
“We’ve never been in a situation like this in Denmark before where one single company has played such a large role,” said Jens Naervig Pedersen, an economist at Danske Bank.

Last year, two-thirds of Denmark’s economic growth could be attributed to the pharmaceutical industry, said Jonas Dan Petersen, a chief adviser at Denmark’s national statistics agency, which doesn’t provide company-specific data.

And the impact has grown even more stark: “Without the pharmaceutical industry, there was almost no growth” in economic output in the first quarter of this year from a year earlier, Mr. Petersen added. The Danish economy grew 1.9 percent over that period, with 1.7 percentage points of that contributed by pharma.

Denmark is the home of other pharmaceutical companies, but Novo Nordisk has far outpaced them. The company’s revenue last year was about 10 times that of the next largest Danish pharmaceutical company, Lundbeck.

For a long time, Novo Nordisk was almost single-minded in its focus on tackling diabetes. But its new weight-loss drugs are now heavily prescribed, particularly in the United States. The U.S. Food and Drug Administration approved Ozempic as a diabetes medication in 2017; the agency approved Wegovy in 2021.....