Obesity drugs make Novo Nordisk Europe’s biggest company

Novo Nordisk’s extraordinary run continues, with the Danish pharmaceutical giant last week overtaking French luxury group LVMH as Europe’s most valuable company.

The numbers are eye-popping. Shares in the €400 billion firm, best known for its weight-loss drugs Wegovy and Ozempic, have more than quadrupled since 2018. They are up over 40 per cent in 2023, with most of those gains coming over the last month.

Consequently, Novo is worth more than the combined value of all the other companies in the OMX Copenhagen 25, Denmark’s benchmark index. More valuable than the annual GDP of Denmark, it is keeping Denmark out of recession; the Danish economy would have contracted in the first half of 2023 were it not for Novo.

Recent optimism was partly fuelled by a study showing Wegovy reduced the risk of heart attacks by 20 per cent. Investors’ mood was further boosted last week after Wegovy, which helps patients lose weight by tricking the brain into feeling full, was launched in the UK.

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Fighting obesity is big business today. The problem is especially marked in the US, where more than 40 per cent of adults are obese. Demand for treatments is skyrocketing, with Novo chief executive Lars Fruergaard Jørgensen saying last week they are “just scratching the surface” and that it could take “quite some years before we have actually fulfilled the demand out there”.

Sceptics might argue this future growth is already reflected in Novo’s soaring share price. For now, however, bullish shareholders will be hoping market momentum augurs well for Europe’s most valuable company.