Novo Nordisk is investing 432 million euros ($506 million) in a facility in Eire because it expands its manufacturing capacities to make the newly launched Wegovy capsule, the Danish drugmaker stated Monday.
The information comes about two months after Novo launched its blockbuster weight reduction drug Wegovy in capsule kind within the U.S. market, in what has been described as one of many strongest launches ever.
“With the funding within the Athlone facility, Novo Nordisk is increasing its manufacturing capacities for oral merchandise, which is able to strengthen our potential to satisfy each present and future demand, exterior the US,” stated Kasper Bødker Mejlvang, Novo’s government vice chairman of chemistry, manufacturing and controls and product provide.
It follows Novo Nordisk dropping market share to Eli Lilly, and traders doubting that its pipeline holds sufficient promise to win it again. The inventory has tumbled consequently, and at the moment trades at roughly 1 / 4 of what it did at its peak in mid-2024.
“The funding is an indication of accelerating focus and guess on the oral area from Novo Nordisk – an space the place Novo has an edge,” Jyske Financial institution analyst Henrik Hallengreen Laustsen advised CNBC Monday.
Guaranteeing Wegovy provide
Novo loved a first-mover benefit within the anti-obesity market and launched its GLP-1 drug semaglutide, offered as Ozempic and Wegovy, years earlier than Lilly’s rival drugs.
It did, nevertheless, misjudge the demand for its weight reduction jabs. With semaglutide in brief provide, compounding pharmacies have been allowed to flourish via a loophole in U.S. rules, which permits the authorized making of patented medication throughout a scarcity.
Provide points have since been resolved as Novo ramped up manufacturing capability. Even so, compunders proceed to promote cheaper copycat variations of the drug, and it’s nonetheless weighing on Novo’s gross sales. The corporate is concerned in a number of authorized battles over mental property.
Novo has repeatedly stated it has sufficient provide of the Wegovy capsule to satisfy demand within the U.S., the one market the place it has launched thus far.
Even with the brand new Eire funding, Sydbank analyst Søren Løntoft Hansen says it will likely be a problem for Novo to satisfy demand for the capsule globally.
Novo’s announcement Monday about increasing manufacturing capability displays a need to launch the capsule in different nations, Hansen stated. It’s at the moment below assessment by the European Medicines Company, and a possible approval is predicted by year-end.
“It additionally displays the very profitable launch within the U.S., which is definitely additionally maybe the perfect launch of a drug ever,” Hansen advised CNBC.
Based on Barclays analysts who intently observe Wegovy’s uptake, U.S. Wegovy capsule prescriptions are outpacing the early rollouts of current GLP-1 injections. Novo CEO Mike Doudstar advised CNBC in mid-February that 246,000 sufferers have been taking oral Wegovy.
Novo Nordisk shares are trailing Eli Lilly’s.
Novo shares have been down about 1.2% Monday, notching a recent 52-week low.
“It looks as if from the share worth response that it’s a drop within the ocean, however I truly assume this indicators a perception on this Wegovy capsule and that, capacity-wise, they want extra [to meet] attainable future demand exterior the U.S.,” stated Hansen.
The market is probably going ready for Lilly to launch its rival weight reduction capsule orforglipron within the second quarter of this yr earlier than making a name on Wegovy capsule’s future prospects.
The development tasks in Eire have already begun and will likely be finalized steadily all through 2027 and 2028, Novo stated. It can contain each capability enlargement and technological upgrades of current services.
Based on Laustsen, the location is prone to give attention to oral zenagamtide and amycretin, each experimental medication developed by Novo. “An anticipated launch in 2029 and matches properly with Novo’s strategic component of accelerating give attention to oral alternatives within the weight problems market,” he stated.
