Novo Nordisk parent buys US drug firm for $16.5bn to expand Wegovy supply

The explosion in demand for the weight-loss drug Wegovy has led to the holding company behind its maker, Novo Nordisk, buying a leading US-based drugmaker for $16.5bn (£13.2bn) to increase capacity.

Novo Holdings is to buy the New Jersey-based pharmaceutical firm Catalent, and then immediately sell three of its sites for $11bn in US and Europe to Wegovy Novo Nordisk, which will increase its ability to match supply with growing demand.

The deal comes as the popularity of Wegovy and Ozempic, Novo Nordisk’s diabetes drug, continues to grow, helping to cement the Danish drugmaker as Europe’s most valuable company, with a market value of about $500bn.

Novo’s boom has been largely driven by the popularity of the drugs, which are used by celebrities including Elon Musk and Oprah Winfrey and are increasingly being used in public health. Obesity drug sales at Novo Nordisk jumped by 154% up to £4.8bn last year, with Wegovy accounting for £3.6bn of that.

However, this rise in demand has led to supply problems, with Novo Nordisk having to limit the number of Wegovy starter doses it could issue last May, as demand outpaced the company’s manufacturing capacity.

Novo Holdings’ chief executive, Kasim Kutay, said in an interview with Reuters: “We have sold some very important fill-finish capacity to Novo Nordisk as part of this transaction.

“A key strategic consideration for Novo Nordisk, particularly when thinking about patients and making sure there is broader rollout for Ozempic and Wegovy, is enhanced capacity.”

Novo Holdings owns just over 28% of economic shares in Novo Nordisk and 77% of its voting shares.

Lars Fruergaard Jørgensen, the president and chief executive at Novo Nordisk, said: “We are very pleased with the agreement to acquire the three Catalent manufacturing sites which will enable us to serve significantly more people living with diabetes and obesity in the future.”

The deal between Novo Nordisk and its parent company will mean it pays $11bn for the fill-finish sites in Anagni (Italy), Brussels (Belgium) and Bloomington (Indiana, US).

Catalent is already the main supplier of “fill and finish” work, which includes the packaging and filling of injection pens, but the deal means the sites will now exclusively deliver Novo Nordisk drugs.

The two drugs have proved popular in the US, particularly Wegovy, with Novo Nordisk estimating that 1 million Americans have used the drug since it was approved in 2021 and 600,000 are currently using it.

Other pharmaceutical firms are looking to recreate Novo’s success, including Eli Lily with its Mounjaro jab, also known as Zepbound, which also treats patients with obesity and type 2 diabetes.

Trials for the drug have shown it can help people lose about 20kg (three stone) on average.

Weight-loss drugs are injected into the body and mimic the action of a gut hormone, GLP-1, by suppressing appetite and slowing the movement of food through the digestive system.

They have helped many people lose significant amounts of weight but can cause side-effects ranging from nausea, bloating, diarrhoea and fatigue to more serious stomach, kidney and gallbladder problems and inflammation of the pancreas.

The NHS began using Wegovy last September in what it called a “controlled and limited launch”.

Those eligible should have a body mass index of more than 30 and at least one weight-related co-morbidity. The drug is administered by specialist NHS weight management services alongside a reduced calorie diet and exercise.

It was estimated that as many as 50,000 people could be eligible to use the drug.

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