Novo Nordisk stock popped Wednesday after the Danish drugmaker's biggest moneymaker, a diabetes medicine called Ozempic, put up a commanding fourth-quarter beat.
Ozempic sales rocketed almost 79% year over year to about $4.37 billion, smashing views for $3.77 billion, according to FactSet.
But that came amid a lackluster showing from Wegovy, Novo's weight-loss drug. Ozempic and Wegovy are different formulations of the same drug, semaglutide. While Wegovy sales almost quadrupled during the December quarter, hitting $1.4 billion, they missed projections for $1.43 billion.
Now, Novo Nordisk is calling for the diabetes and obesity space to become increasingly competitive. For the first time, it's facing competition in the GLP-1 weight-loss drugs market. Eli Lilly now sells Zepbound, a weight-loss drug whose active ingredient, tirzepatide, is also sold as a diabetes drug called Mounjaro.
For the year, Novo Nordisk expects sales to increase between 18% and 26%, excluding the impact of exchange rates.
This is "mainly driven by volume growth of GLP-1-based treatments for obesity and diabetes care," Novo said in a written statement. "Intensifying competition and continued pricing pressure within diabetes and obesity care are included in this guidance."
On the stock market, Novo Nordisk stock jumped 5.3% to 114.74. Shares closed above a buy zone with an entry at 105.69, according to MarketSmith.com. The chase zone runs up to 110.97.
Novo Nordisk Stock: Obesity Treatment Sales Double
Overall, fourth-quarter sales increased more than 39% to about $9.58 billion, based on today's exchange rates. That easily beat the estimate of analysts polled by FactSet for $9.15 billion. Adjusted earnings also surged north of 65% to 71 cents per share, topping calls for 67 cents.
Sales of obesity treatments Wegovy and Saxenda collectively doubled — and then some — in the fourth quarter. But $1.63 billion in sales of the two medicines fell short of Novo Nordisk stock analysts' estimate for $1.74 billion, according to FactSet.
But revenue from diabetes treatments Ozempic, Victoza and Rybelsus handily beat expectations for $6.18 billion, coming in at $7.28 billion. Rybelsus is an oral form of semaglutide, the drug behind Ozempic and Wegovy. Total diabetes drug sales rocketed 104%.
"We are very pleased with the strong performance in 2023 reflecting that more than 40 million people are now benefiting from our innovative diabetes and obesity treatments," Novo Chief Executive Lars Fruergaard Jorgensen said in a written statement.
Meanwhile, sales of insulins — which treat type 1 diabetes and severe type 2 diabetes — fell short at $1.74 billion. Novo was among a trio of drugmakers last year that slashed insulin prices. Lilly and Sanofi also did the same.
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