What do you do when you discover a «miracle» weight loss drug that could become one of the best-selling drugs of all? time? Throwing a big party, of course.
Novo Nordisk, the company behind the weight loss drug Wegovy, which launched in the UK on Monday, threw what it called «Denmark's wildest employee party» late last month.
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The company organized a one-day festival for 10,000 employees on a field in Roskilde, an area that had hosted one of Europe's biggest music festivals just two months earlier.
Some of the country's most celebrated artists have performed on the four stages, including Tobias Rahim, the half-Kurdish, half-Danish pop star the New York Times called a «phenomenon.»
There's Something to Celebrate: The Cost of Novo Nordisk has almost doubled in a year thanks to the huge success of Wegovy and Ozempic, a closely related diabetes treatment also developed by the company.
Everyone from Boris Johnson to Elon Musk demanded his weight. drugs, not to mention the general public, leaving the company struggling to keep up with demand.
0509 Novo Nordisk is the most valuable company in Europe
Last year, revenue jumped a quarter to DKK 176 billion (£20 billion) thanks to a 101 percent increase in sales of Wegovy and other weight loss product Saxenda.
Some analysts believe the company may have stumbled upon something that could become one of the best-selling drugs in history. Sales are projected to grow by 33% this year, an outstanding result for a 100-year-old company.
The scale of Novo Nordisk's success cannot be underestimated. It's worth almost £340 billion after its recent share price surge, and is now more valuable than what the entire Danish economy produces in a year.
It's almost the most valuable business in Europe, and bigger than the next ten largest Danish companies combined.
If not for the rapid growth of the company, the National Bank of Denmark said that the country would be in recession.
In a small Scandinavian country with a population of six million people, the company took off rapidly. was greeted with a mixture of euphoria and anxiety.
Many of Novo Nordisk's shareholders are ordinary Danes, and locals are proud of the national champion, bringing huge profits to the country. The company spends heavily on new plants, often in areas where investment is otherwise lacking.
However, there are concerns that over-reliance on one business could be risky if the boom turns into a bust.
>“There are other big companies in Denmark, and they are important too, but we haven’t had anything as big as this yet, and there hasn’t been anything that has grown so fast,” says Las Olsen, chief economist at Danske Bank .
“Novo Nordisk is by far the largest taxpayer in Denmark and the figure is only increasing.”
0509 Strong pharmaceutical exports boost the Danish economy
The company is one of the oldest companies in Denmark and was founded by a Nobel Prize winner. physiologist August Krogh. It was the first company to manufacture and market insulin in Scandinavia and today produces half of the world's supply of insulin, including those used by the National Health Service.
For decades, the company has done a solid business supplying insulin for diabetes , but its recent wild success has been fueled by the weight loss drug Wegovy, which has been found to help patients lose up to 12% of their body weight.
By mimicking the intestinal hormone that the body produces after eating, the drug significantly reduces appetite. This means that people who struggle to stick to a strict diet and exercise regimen can still lose weight.
The diabetes drug Ozempic, which doctors have also prescribed off-label for obesity, has also proven to be a big seller.
Novo Nordisk's share price received an additional boost last month when a study found that Wegovy reduced the risk of heart attacks by one-fifth, giving health insurers more incentive to include it in their coverage.
Incredible clinical results and a breakthrough in treatment of obesity led Wegovy to be dubbed by the press as a «miracle» drug.
This treatment has certainly become an economic miracle in Denmark.
«Last year, if it were not for this growth, there would actually be a reduction in Danish GDP,” Olsen says of Novo Nordisk’s growing sales.
The Ministry of Economy mentioned Novo Nordisk 31 times in a recent flagship publication on the outlook for the Danish economy.
0509 Growth recovery
At a press conference, Economics Minister Jakob Ellemann-Jensen admitted that it was «a little strange» to single out one company so many times and “of course it's not something that usually happens.”
“Things don't look so good for the economy if you take Novo Nordisk out of the equation. But, fortunately, this is part of the equation,” he said at a press conference.
One of the country's largest financial newspapers recently published an article asking if the Danish economy is going to become a subsidiary of Novo Nordisk. .
Dependence on one company can be a risk in a global economy where business is mobile. Ellemann-Jense acknowledged that Denmark «needs to ensure that Novo Nordisk continues to exist [here] so that we do not lose income, jobs and the pride that we all feel.»
Birte Larsen of the Copenhagen Business School argues that «there is always a risk» when a country becomes «too dependent on one company.»
Nokia's nearest neighbor to the north gives a cautionary tale. The mobile phone pioneer was at one point responsible for a fifth of Finnish exports.
However, sales quickly fell after Apple sparked the smartphone revolution with the launch of the iPhone in 2007.
Nokia and did not fully recover, and its problems caused a decade of stagnation in the Finnish economy.
Olsen says: “If you win a lot, you also have a lot to lose. Obviously, Novo Nordisk may someday go the other way.”
The main risks are that competing pharmaceutical companies develop a drug that can eclipse Vegavi, or if Novo Nordisk for some reason decides to move. Most major pharmaceutical companies are now rushing to develop their own weight loss program.
If the boom turns into a bust, “all the effects will be reversed,” says Olsen, “shareholders will receive less money, the government will receive less taxes, some good jobs will disappear, and GDP will decline.”
Olsen believes that Novo Nordisk's deep roots in the country and Denmark's highly skilled workforce will keep the company's headquarters there.
efforts,” then we would create [this risk] for the future,” says Olsen.
“But that is not the case now.”
More broadly, he believes the Danish economy is resilient enough to withstand any unexpected shocks. In the past, the country has adapted to the decline of once-big industries such as textiles, agriculture and shipbuilding.
“We are used to big changes.”
For now, the Danes are enjoying a windfall from his miracle drug. And why not have a party while it lasts.
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