Novo Nordisk hikes FY outlook, keeps curb on US supply as demand for Wegovy soars

COPENHAGEN, Aug 10 (Reuters) — Novo Nordisk will continue to restrict U.S. supplies of starter doses of its hugely popular Wegovy weight-loss drug in the coming quarters, it said on Thursday, as the company struggles to keep up with soaring U.S. demand.

The news came as the Danish drugmaker raised its full-year profit and sales forecasts for a second time.

Many analysts had expected Novo to raise earnings guidance, given the huge U.S. demand for the weekly injection.

Novo Nordisk, Europe’s second most valuable listed company behind LVMH, is riding a wave of sky-high demand for its highly effective diabetes and weight-loss drugs Ozempic and Wegovy, which has sent earnings and shares to record highs.

Wegovy is a weekly injection that can help patients to shed 15% of their weight alongside diet and exercise changes.

The company said it would extend the limits introduced for Wegovy supplies, having said in May that it would halve supply of starter doses to the U.S. market for several months to ensure supplies for existing patients.

“We’ve seen that the initiative we took earlier this year, limiting the starter dose, has actually helped manage those dynamics. So we want to extend that in the coming quarters,” CEO Lars Fruergaard Jorgensen told journalists.

Reuters has reported that larger doses are also in short supply, which Novo has denied.

A selection of injector pens for the Wegovy weight loss drug are shown in this photo illustration in Chicago, Illinois, U.S., March 31, 2023.  REUTERS/Jim Vondruska/Illustration

A selection of injector pens for the Wegovy weight loss drug. REUTERS/Jim Vondruska/Illustration

More than 650 million adults worldwide are obese and a further 1.3 billion are overweight, exacerbating conditions such as heart disease and diabetes, the World Health Organization says.

Having raised its earnings guidance in April, Novo now expects 2023 operating profit growth in local currencies of between 31% and 37% on sales growth of 27-33%. The new outlook is up from previous estimates of 24-30% and 28-34% respectively.

“The growth is driven by increasing demand for our GLP-1-based diabetes and obesity treatments, and we are serving more patients than ever before,” Jorgensen said in a statement.

Jyske Bank analyst Henrik Hallengreen Laustsen said second-quarter sales and earnings came in slightly below expectations, while costs were also higher than anticipated by analysts.

“Fortunately, the core products Wegovy and Ozempic beat expectations, but there are a few disappointments here and there, in the Insulin division and Rare Diseases,” Laustsen said.

The company also warned that it expected “continued periodic” supply constraints and drug shortages across a number of products and geographies.

(Reporting by Nikolaj Skydsgaard. Editing by Josephine Mason and Mark Potter)

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