Novo Nordisk official website
Star pharmaceutical company Novo Nordisk once again gained market attention this week.
On January 31st, this company, founded in 1923, achieved a significant milestone, becoming the second European company after LVMH to reach a market value of $500 billion. As of the time of publication, the company's stock price was $115.79 per share, with a market value of $515.974 billion.
Leading the company to a new peak is its star weight loss medication. The financial report released on January 31 showed that Novo Nordisk's revenue in 2023 increased by 31% year on year, including the total sales of Smeaglutide products, including Ozempic (for treatment of type 2 diabetes and obesity) and Wegovy (for weight management of obese patients), increased by 88.78% year on year. From a single product perspective, Wegovy's annual revenue growth rate reached an astonishing 407% year-on-year!
From the financial report data, it can be seen that Ozempic and Wegovy are not only the fist products that have changed the fate of Novo Nordisk, but also the game rules of the industry. And all of this cannot be separated from a bold decision by Lars Fruergaard Jrgensen, the global president and CEO of the company.
According to the Financial Times, shortly after taking over as CEO of Novo Nordisk in 2017, Zhou Fude made a decision, laying the groundwork for the future takeoff of this Danish pharmaceutical company.
At that time, the company had not yet launched Ozempic, and Wegovy was still far from being approved for weight management in obese patients. The management team was discussing whether to conduct an expensive experiment to demonstrate whether Wegovy can reduce the risk of heart disease and stroke.
Executives are filled with various questions - "Why do we take the high risk of conducting such experiments that we may not get anything? If we don't find any problems with obesity, wouldn't the billions of dollars spent on the experiments be wasted?"
But Zhou Fude approved the experiment with approval. In the end, his gambling paid off. Preliminary trial data released in August 2023 showed that patients using Wegovy had a 20% lower risk of cardiovascular events such as heart disease or stroke compared to those taking placebo.
It has always been recognized in the industry that weight loss can usually improve heart health, but there is no safe and effective weight loss medication that has been proven to reduce specific risks. Wegovy's success has demonstrated that obesity drugs not only help with weight loss, but also prevent heart disease, stroke, or death related to the heart. The Associated Press stated that this may change people's perception of the new weight loss medication as a beauty medication and put pressure on healthcare insurance companies to include it in their insurance coverage.
This success has added wings to Novo Nordisk like a tiger. Last September, Novo Nordisk quietly surpassed LVMH to become the most valuable listed company in Europe, ending the latter's two-and-a-half-year dominance at the top of the list.
Returning to Zhou Fude himself, everything about him is low-key. In 1966, he was born on a pig farm in the Jutland Peninsula of Denmark. According to foreign media, "here, he learned how to take responsibility from a young age.".
According to reports, Zhou Fude is tall and thin, looking thoughtful and completely different from the traditional image of trading enthusiasts CEOs. His career began as an economist in the healthcare and planning department of Novo Nordisk.
In 1991, after completing his personal studies in finance and business, Zhou Fude joined Novo Nordisk through a graduate program and worked for companies in the United States, Japan, and the Netherlands. At the beginning of 2017, he took office as the CEO of Novo Nordisk, and it has been 7 years since then.
Foreign media reported that Zhou Fude often drives his own electric car to work and kayaks on the nearby lake to ponder. He would not claim, like some Silicon Valley executives, that his products can be a panacea for solving social problems, but he believes that his company and industry have "enormous opportunities to influence the world.".
The popularity of Wegovy and Ozempic has also led Zhou Fude to be selected as the 2023 Person of the Year by the Financial Times. Now, he has unlimited business opportunities in front of him - BMO, a Canadian investment bank, estimates that this (diabetes and diet pills) market can reach an annual scale of 130 billion to 140 billion dollars at its peak. Norwegian Bank Investment Management predicts that both Novo Nordisk and Lilly, as major players in the market, may become members of the trillion dollar club.
But Zhou Fude also faces enormous challenges. According to the Financial Times, the company is still working hard to expand the supply of Wegovy drugs, although the potential patient population is very large, some health insurance companies are unwilling to pay the fees.
Moreover, these drugs carry the risk of exacerbating health inequality. Wegovy is priced at $1300 per month in the United States, but the net cost is usually about half, and even lower in Europe. If the United States does not expand insurance coverage, or if the European public health system does not provide this medication more widely, it will be difficult for many of the poorest people to reach.
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