Novo Nordisk is restricting some doses of obesity blockbuster drug Wegovy in the U.S., the company said Thursday after boosting its full-year outlook. Novo Nordisk stock fell on light second-quarter sales.
In the U.S. alone, sales of the weight-loss medication skyrocketed 344% during the first six months of the year. Due to the outsized demand, Novo plans to restrict U.S. supplies of low-dose Wegovy.
Chief Executive Karsten Knudsen says Novo isn't facing supply issues. Rather, the company wants to ensure it has a sustainable supply for patients who've already started treatment.
"The best way to do that is, of course, not to start more patients than we can secure continuity of care," he said on the company's earnings conference call. "And then furthermore, not to launch in more affiliate (markets) than we can support. So, you should not see the language (in the news release) as uncertainty on the supply side, but more that we'll be navigating the market in a sustainable manner."
On the stock market today, Novo Nordisk stock fell 2.9% to close at 182.09.
Novo Nordisk Stock: Sales Miss
In the June quarter, Novo earned an adjusted $1.44 per share on about $8 billion in sales. Earnings skyrocketed 80% and beat forecasts for profit of 80 cents a share. Sales also rocketed 42.5%, but lagged more bullish calls for $8.21 billion, according to FactSet.
Some of the pitfall came from Rybelsus, an oral diabetes treatment that belongs to the same drug class as Wegovy and injectable diabetes drug Ozempic. Rybelsus sales more than doubled year over year, hitting $645.9 million, but that lagged Novo Nordisk stock analyst estimates for $697.3 million. Ozempic sales also came in a tad light at $3.25 billion, but surged 66% vs. the year-earlier period.
Meanwhile, sales of Novo Nordisk's obesity treatments, Wegovy and Saxenda, brought in a combined $1.57 billion in sales, more than tripling year over year and beating projections for $1.52 billion.
Third Bridge analyst Lee Brown says Wegovy's growth is "truly remarkable." He said it could help soften the blow of light sales from diabetes drugs Victoza, Tresiba, Levemir and Fiasp. Overall, insulin sales declined 7%, driven by a 25% drop in sales in North America.
"As such, despite the impressive performances by both Ozempic and Wegovy, we suspect analysts will need to sharpen their pencils and evaluate projections for much of the rest of Novo's drug portfolio," Brown said in a note to clients.
Novo Boosts Outlook, Buys Inversago
Despite the sales shortfall, Novo raised its outlook for the year. The company now expects sales to pop 27% to 33%, excluding the impact of exchange rates. Novo Nordisk stock analysts projected $33.24 billion in sales, which would rise 28% on an as-reported basis.
Novo also expects operating profit to grow 31% to 37% in constant currency.
Notably, the company announced plans to acquire privately held Inversago Pharma for up to $1.08 billion. The cash payment is based on meeting certain development and commercial milestones. Inversago is working on treatments for obesity, diabetes and complications of metabolic disorders.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
