By Jacob Gronholt-Pedersen and Maggie Fick
COPENHAGEN (Reuters) -Novo Nordisk forecast another year of double-digit sales growth for its two most popular drugs on Thursday and said it will boost U.S. supplies of Wegovy next year, as it battles to meet soaring demand for the weight-loss drug.
Danish drugmaker Novo, which overtook LVMH as Europe’s most valuable listed company this year, posted record operating profit and sales for the third quarter, underscoring Wegovy’s phenomenal success.
“Specifically on the U.S. market, we’ll be supplying significantly more in 2024 compared to what we are in 2023,” Novo CFO Karsten Munk Knudsen told Reuters in an interview.
Still, CEO Lars Fruergaard Jorgensen said Novo expects demand for Wegovy to outpace supply in the short to medium term, as it maintains curbs on U.S. doses.
Novo has struggled to keep up with soaring demand for the appetite-suppressing anti-obesity drug, and since May has limited the number of U.S. patients who can start treatment.
It is also facing competition from U.S. rival Eli Lilly’s diabetes drug Mounjaro, which is expected to get U.S. approval for weight loss by the end of 2023.
The global obesity drug market could reach $100 billion by 2030 due to the effectiveness of Wegovy and similar medicines.
Novo shares were up 0.9% at 1046 GMT, even as investors and analysts had hoped for clarity on when limits on the supply of Wegovy starter doses in the United States would cease.
Jorgensen did not give an end-date and declined to give details on manufacturing when asked on a media call.
“We don’t see a ‘hockey stick’ development where suddenly there’ll just be a significant ramp-up in sales,” he said, indicating that manufacturing would ramp up gradually.
Nicholas Anderson, a portfolio manager at Novo shareholder Thornburg Investment Management, said after the company’s analyst call that the “number one question on investor’s minds is when will Wegovy supply growth resume? When will they open the gates to allow new patients to start?”.
Novo did not say how much or when, but confirmed “there would be an inflection in supply growth (next year), which is what the market needs to hear,” Anderson added.
In September and October Novo had submitted applications to U.S. and European Union authorities for Wegovy to be approved to reduce the risk of cardiovascular events, it said in its quarterly earnings statement.
That followed results of a large study released in August that showed Wegovy had a clear cardiovascular benefit, boosting Novo’s hopes of moving it beyond a lifestyle drug.
The U.S. Food and Drug Administration had granted priority review for the application, Novo said.
“(It’s) slightly negative that Wegovy is still supply restrained,” said Markus Manns, a fund manager at Union Investment and a Novo shareholder.
However, the decision to fast-track Novo’s application in the United States was positive, he said.
Eli Lilly cut its full-year earnings outlook due to charges for recent acquisitions but reported billion dollar quarterly sales of Mounjaro. However, it also flagged delays in fulfilling orders of certain Mounjaro doses due to high demand.
Wegovy sales totalled 9.6 billion Danish crowns ($1.36 billion) between July and September, up 28% from the previous quarter and an eight-fold rise from the same period last year.
In August, Novo said the curbs on Wegovy supplies would most likely extend into 2024.
It also said U.S. prescription volumes for GLP-1 class, its hugely popular weight-loss and diabetes drugs, grew by 50% in the quarter compared to last year.
Last month Novo raised its full-year sales and operating profit guidance for the third time in 2023, reflecting strong demand for Wegovy and diabetes medication Ozempic in the U.S.
Sales grew 29% year-on-year to 58.7 billion Danish crowns, while operating profit (EBIT) rose 33% to 26.9 billion, both in line with preliminary numbers released last month.
($1 = 7.0443 Danish crowns)
(Reporting by Jacob Gronholt-Pedersen; Editing by Terje Solsvik, Shri Navaratnam, Emelia Sithole-Matarise, Jan Harvey, Josephine Mason, Susan Fenton and Alexander Smith)