By Jacob Gronholt-Pedersen and Maggie Fick
COPENHAGEN (Reuters) -Novo Nordisk said on Thursday it expects another year of double-digit sales growth for its two most popular drugs and will boost U.S. supplies of weight-loss drug Wegovy next year as it struggles to keep up with soaring demand.
The Danish drugmaker, which this year overtook LVMH as Europe’s most valuable listed company, posted record operating profit and sales for the third quarter, underscoring the phenomenal success of Wegovy so far.
“Specifically on the U.S. market, we’ll be supplying significantly more in 2024 compared to what we are in 2023,” Novo’s CFO Karsten Munk Knudsen told Reuters in an interview.
Still, CEO Lars Fruergaard Jorgensen said Novo Nordisk expects demand for Wegovy to outpace supply in the short to medium term, as the drugmaker keeps curbs on U.S. doses in place.
Novo has struggled to keep up with soaring demand for the appetite-suppressing anti-obesity drug, and has limited the number of U.S. patients who can start treatment since May.
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 the year.
Novo shares were trading 0.9% higher 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.
The company still plans to contract a third manufacturer this year to help produce Wegovy, Knudsen said.
It also said in its quarterly earnings statement that in September and October it had submitted applications to U.S. and European Union authorities for Wegovy to be approved to reduce the risk of cardiovascular events.
That followed results of a large study released in August that showed Wegovy had a clear cardiovascular benefit, boosting Novo Nordisk’s hopes of moving it beyond its image as a lifestyle drug.
The U.S. Food and Drug Administration had granted priority review for the application, the company 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 during the quarter.
SUPPLY ISSUE IN FOCUS
Wegovy sales totalled 9.6 billion Danish crowns ($1.36 billion) between July and September, up 28% from the previous quarter and eight-fold from the same period last year.
In August, Novo said the curbs on Wegovy supplies would most likely extend into 2024.
Investors and analysts have called for clarity on when the supply issue would be solved.
The company 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 this year, 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 and Susan Fenton)
