Novo Nordisk notches big GLP-1 sales amid rebounding supplies, but cautions on future ‘periodic constraints’

With Novo Nordisk’s obesity treatment Wegovy fully back in stock in December, sales are beginning to soar, the Danish pharma reported during its annual earnings call on Wednesday. Total scripts of the glucagon-like peptide 1 (GLP-1) Wegovy topped 37,000 weekly in mid-January, a hockey stick uptick from end-of-year levels below 15,000 per week.

The new prescriptions come on top of the overall momentum of Novo obesity drug sales in 2022, although the then supply-constrained Wegovy was only part of that. Sibling obesity med Saxenda accounted for DKK 10.7 billion ($1.58 billion) of the total DKK 16.9 billion ($2.49 billion), or about 63%, in Novo Nordisk’s reported obesity segment sales.

And the future in obesity looks even brighter.

“We know for a fact that there is pent-up demand,” CEO Lars Fruergaard Jørgensen said. “It’s really for us to size it, to be honest. We are obviously impressed by the trendline we see, but we also do believe that there will be a normalization of that.”

Novo has forecasted sales growth between 13% to 19% with a “large chunk” of that attributed to Wegovy, CFO Karsten Munk Knudsen said.

Executives were careful to point out that while GLP-1 supplies are back, they still expect “periodic supply constraints” in the coming year.

For the full year 2022, Novo Nordisk reported total sales of DKK 177 billion (about $26 billion), marking a 16% increase over 2021.

Diabetes drugs made up the bulk of Novo Nordisk’s revenue, with GLP-1s leading the sales growth charge.

Sales of GLP-1 drugs for type 2 diabetes — the trio of Ozempic, Victoza and Rybelsus — jumped by 57% to DKK 26.2 billion ($3.87 billion) in 2022. The big GLP-1 gains helped offset a cascade of losses in other insulin sales categories, including long-acting (down 1%), premixed (down 9%) and human insulin (down 18%) to give Novo Nordisk’s diabetes care revenues a 10% bump and total global sales of DKK 139.5 billion ($20.58 billion).

Novo Nordisk said it now holds a 50.3% US market share of total GLP-1 prescriptions in both obesity and diabetes in the latest January data.

Camilla Sylvest

One potential bright spot in Novo’s insulin portfolio is its insulin icodec, a once-a-week candidate in diabetes. It plans to file for US, Canada and EU approval in the first half of this year, and as head of the commercial strategy Camilla Sylvest said, Novo sees the drug as a potential standard of care for newly diagnosed type 2 diabetes patients as a new and convenient — and environmentally friendly — way to manage insulin.

Meanwhile, Novo’s forecast for Wegovy stands at DKK 25 billion ($3.69 billion) by 2025, but at least one analyst questioned if that could be conservative.

Citigroup analyst Peter Verdult did some rough math, noting that with Wegovy approaching 40,000 weekly scripts, that would mean sales of about $2 billion for the year. As for what might be possible for 2023, he asked if that “pent-up demand” and active promotion of Wegovy could drive sales to the $3 billion to $4 billion range.

Karsten Munk Knudsen

Knudsen pointed back to Novo’s 13% to 19% estimated growth and the fact that a lot of that comes from Wegovy.

“That 19% is not a magic ceiling in terms of our guidance — it’s basically a function of products and geographies and timing,” he said, adding that Novo is scaling manufacturing with one line to be added in the first half and another in the second half.

He also cautioned, “We do not have unlimited capacity and so trading on vertical TRx uptake is impossible. That’s why we’ve been saying be careful with the first data points because they are impacted by the pent-up demand that Doug (Langa, president and head of North America operations) was talking about.”

The elephant in the room, though, was the ongoing question about the use of GLP-1s off-label for weight loss as a source of growth. While asked by several media members and financial analysts about the market dynamics and reports of runs on GLP-1s approved for type 2 being prescribed off-label, Novo Nordisk executives deflected on an official link between the two. They did acknowledge the shortages and the skyrocketing use, but mainly referred to it more simply as “demand.”

Jørgensen answered one query about media reports of off-label use of type 2 GLP-1s by pointing out that Novo Nordisk has a very clear focus on exactly what Ozempic and Wegovy are approved and used for.

“We have a keen focus on establishing two different segments with different products and different commercial tactics,” he said.

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