Yahoo Finance Insulin maker Novo Nordisk to make more weight-loss drugs
Novo Nordisk (NOVO-B.CO) revealed on Wednesday that it will increase its manufacturing capacity for weight-loss drugs after strong sales in its latest quarter.
The Danish multinational pharmaceutical company said it will now mainly focus on obesity drugs, after the chaotic introduction of its injectable weightloss drug Wegovy last year.
It comes as it raised its full-year earnings outlook after better-than-expected profit on strong sales of the GLP-1 analogue drug Ozempic, which was created to treat people with diabetes.
Ozempic sales have been partly driven by prescriptions to non-diabetic patients who are using it help them lose weight, which is outside its approved indication.
Lars Fruergaard Jorgensen, chief executive of Novo Nordisk stressed that the firm only promotes drugs only within approved indications.
But he said: "We believe that the weight benefit of Ozempic is becoming a stronger prescription driver because it also matters to people with diabetes."
The company now expects operating profit growth at constant exchange rates of between 13% and 16%, up from a previous target range of 11-15%.
Meanwhile, third-quarter operating profit rose by almost a third to 20.2bn Danish crowns (£2.4bn, $2.7 billion), above the 19.2bn forecast by analysts.
Sales in North America operations increased by 37% in Danish kroner, and sales in international operations increased by 16%, the group said.
Novo Nordisk shares rose 5.6% on the back of the news to a three-month high.
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Jorgensen added: "As we look to launch future products, obviously we will take into consideration more of a pull than a push commercial strategy. And that links into how we scale capacity for that.
"We see this pull nature in the market for anti-obesity medicine, which is fantastic because we have the broadest portfolio in the industry to do that.”
The company is in a drawn-out production revamp after a contractor filling Wegovy injection pens ran into problems late last year.
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