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Novo Nordisk is seeking deals to bolster its global leadership in weight loss after identifying promising trial results for its anti-obesity pill that would expand the Danish drugmaker's portfolio beyond top-selling injectables Wegovy and Ozempic.
Speaking at the company's headquarters in Bagjesværd on the outskirts of Copenhagen, CEO Lars Frørgaard Jørgensen said potential targets for acquisitions or partnerships include biotech companies with assets in mid-stage trials.
“You can assume we're looking at everything, or at least most of it,” he said.
David Moore, vice president of corporate strategy, added that the company will focus on acquisitions in the diabetes and obesity space, ideally in the early stage of development.
“Valuations have gone up… It's about making investments that we think will serve patients in the future. The longer it is developed, the higher the valuation will be,” Moore said.
The comments came after Novo Nordisk shares hit a record high on Thursday, when the Danish group revealed early-stage results for an experimental new weight-loss pill that appeared to deliver better results than its blockbuster Wegovy product. Europe's most valuable company, which has a market capitalization of 4.1 trillion Danish kroner ($602.7 billion), also said it expects China to approve the sale of Wegovy later in 2024.
Investors and analysts are looking for the next product of “small molecule” drugs — synthetic drugs that can be easily replicated into pill form — rather than complex, often injectable drugs made from living cells, such as Novo Nordisk's Wegovy, which mimics a hormone called GLP. . -1.
The tablet product, acquired through last year's acquisition of Canadian biotech company Inversago, could be a scalable weight-loss pill and an alternative to common GLP-1-based drugs, Fruergaard Jørgensen said.
“It's interesting how much interest there is in small molecule GLP-1s. If something has a different name, a different set of letters, the interest is hypothetically less but we think it's actually more exciting,” Frørgaard Jørgensen said.
He added that the company aims to develop a wide range of medicines and use its manufacturing scale to stay ahead of its pharmaceutical competitors seeking to capitalize on the consumer “hype” for weight loss products.
Companies including Britain's AstraZeneca and Swiss group Roche have recently purchased or licensed weight-loss drugs in a bid to enter a market that analysts expect will exceed $100 billion by 2030.
But the companies have no history of manufacturing the protein that Novo Nordisk and US rival Eli Lilly use to make their diabetes and weight loss products.
Frørgaard Jørgensen warned that new entrants would face a long way to catch up with Novo Nordisk and US rival Eli Lilly, due to the innovation required to develop safe and effective products and the manufacturing power needed to market them.
“There are many companies that can build out the space over time. They may not scale or expand like the two companies that have been in this for 100 years,” he said.
“For a newcomer…having a small space of this at the lower end of the market is better than not being there,” he added.
The company has struggled with its supply issues. It recently acquired three sites from contract manufacturer Catalent for $11 billion to boost its injection pen filling capacity, as part of a three-way deal led by controlling shareholder Novo Holdings.
Fruergaard Jorgensen also said that Novo Nordisk's efforts to develop some of its oral medicines will require more active pharmaceutical ingredients than injectable ones. The company also believes that some users prefer once-weekly injections to daily pills.
“If you look at how we've increased API capacity, we're expanding to serve many more patients,” he said. “The more we take orally, the less we can give by injection.”
