Novo Nordisk sales up 26% driven by GLP-1s, misses 11% on Wegovy
Novo Nordisk (NVO) stock was trading down Thursday despite strong first quarter results, beating Wall Street consensus, led by the blockbuster GLP-1s Ozempic for diabetes and Wegovy for weight loss.
Novo posted total sales up 25%, totaling $9.5 billion in revenue from all of its drugs and beating estimates of $9.2 billion. Wegovy brought in $1.3 billion and Ozempic sales totaled $3.9 billion for the quarter.
CEO Lars Jørgensen told Yahoo Finance the company is now filling 27,000 new prescriptions per week of Wegovy — more than five times the 5,000 per week being filled at the end of the last quarter of 2023.
Still, Novo missed Wall Street estimates of Wegovy sales by 11%, even as supply has increased, prescriptions have increased, and the company lowered the price based on those metrics and increased competition from Eli Lilly's (LLY) Zepbound. Novo declined to provide an exact price.
Meanwhile, the approval of Wegovy for obese patients with cardiovascular disease risk earlier this year has opened a new revenue source: Medicare dollars.
"We are now sailing into the CMS [Centers for Medicare & Medicaid Services] part of our business, where obesity medicine has not been available in the past," Jørgensen said.
He added that the company is confident in its growth outlook for the year.
"We are very comfortable in ... our ability to ramp and get to many more patients and thereby also deliver the broad benefits that comes with treating both obesity and type 2 diabetes," Jørgensen said.
Government pressures
Novo, Europe's most valuable company, is also a target of many government investigations, ranging from US pricing and patent concerns to Novo's home country, Denmark, restricting access to Novo's GLP-1s — preferring cheaper alternatives — beginning Nov. 25.
The Federal Trade Commission recently sent a warning letter to 10 companies, including Novo Nordisk, concerning "junk" patents of Ozempic and its older weight loss drug Saxenda, as well as older type 2 diabetes drug Victoza. The FTC has been going after what it deems improper or inaccurate patent listings, which it says curbs competition in the long run.
Jørgensen said he doesn't like the term "junk patents" and believes the company is ethical about its patent filings. He noted that the patents the FTC flagged cover devices used by Novo for its drugs rather than the drug compounds themselves — which is where a majority of pharma competition lies.
"We have tried to follow what we believe was the requirement in terms of listing the patents covering the products we have on the market. So it's important for me to underline this is not linked to the compound patent, the basic molecule, and honestly we can live without the patent on devices being listed on the Orange Book," he said.
Meanwhile, there are ongoing concerns about the list price of Ozempic.
Jørgensen defended the pricing, noting that it is down 40% compared to when it launched in 2018, and that companies compete more on rebates, fees, and discounts — with pharmacy benefits managers — which skews the conversation.
"I think it's important to get into the details of these [points] to get a true and fact-based discussion around the price .. .in the US market," Jørgensen said.
Anjalee Khemlani is the senior health reporter at Yahoo Finance, covering all things pharma, insurance, care services, digital health, PBMs, and health policy and politics. Follow Anjalee on all social media platforms @AnjKhem.
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