Without a boost from the pharmaceutical industry making the popular weight loss drugs, the country’s GDP in 2023 would have shrunk
A new class of weight loss drugs hasn’t simply expanded the profits of pharmaceutical companies: It’s also expanded economies. Soaring demand for Ozempic and Wegovy, used to treat diabetes and obesity, bolstered Denmark’s gross domestic product by 2% last quarter.
Danish government agency Statistics Denmark reported in a preliminary reading that that the pharmaceutical industry was a driving force for the nation’s growing economy in the fourth quarter of 2023 and the year overall. Denmark’s GDP grew 1.8% in 2023 — and much of its boost is owed to the pharmaceutical industry. Without pharmaceuticals, the agency says, the country’s GDP would have instead fallen 0.1%.
Leading that growth is Denmark-based Novo Nordisk, which makes diabetes medication Ozempic and weight-loss drug Wegovy. Known as GLP-1s, the drugs suppress appetite by mimicking a hormone that regulates appetite and blood sugars. Skyrocketing sales of these drugs have made Novo Nordisk the most valuable company in Europe, surpassing luxury conglomerate LVMH last year.
Novo Nordisk has been on an upward climb it doesn’t expect to end anytime soon. The company reported in January that its 2023 sales jumped 31% to 232.3 billion Danish kroner ($33.8 billion), compared with 177 billion Danish kroner ($25 billion) in 2022. It also projects sales will increase by up to 26% in 2024.
It’s also expanding its physical footprint to ramp up drug production. This month, Novo Nordisk announced that it has bought three facilities from the drug manufacturing company Catalent for $11 billion in an effort to meet rising demand for Wegovy.
Booming sales for Wegovy and Ozempic could lead to Novo Nordisk becoming one of the first pharma companies to reach a market cap of $1 trillion, according to Norway’s sovereign wealth fund. Only seven companies in the world — including Apple $AAPL, Microsoft $MSFT, and Nvidia $NVDA — have market caps over $1 trillion. The pharmaceutical giant’s market cap currently stands at $542 billion.
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