Danish Drugmaker Novo Nordisk is Now Europe’s Most Valuable Company

Danish drugmaker Novo Nordisk is now Europe’s most valuable company, dethroning luxury goods giant LVMH.

Shares of Novo Nordisk have spiked 40% so far this year, boosted by soaring demand for its weight-loss drugs Wegovy and Ozempic.

Sales of the company’s two flagship drugs have exploded in recent months. Ozempic was developed to treat type 2 diabetes and contains the same active ingredient as Wegovy, which some physicians have prescribed to patients to help them lose weight.

Novo Nordisk is already struggling to keep pace with runaway demand for Wegovy, which clinical trials have shown can help people lose 15% of their body weight after less than 16 months. Recently published results of a five-year trial on the impact of Wegovy on cardiovascular disease also showed the drug reduced the risk of heart attack, stroke or heart-related death by 20%.

Novo Nordisk has raked in almost $7 billion in profit over the first six months of this year, up 30% from the same period in 2022.

The company is forecasting even stronger growth to come. It now expects its profits to increase by up to 37% this year, much higher than the maximum 19% rise it forecast in February.

Booming sales of its drugs have led to an influx of US dollars into Denmark’s economy, pushing up the value of the Danish krone. Denmark’s central bank has responded by keeping interest rates below those set by the European Central Bank, discouraging foreigners from buying krone and reducing the value of the currency.