Novo Nordisk has announced plans to invest over $6 billion to expand its manufacturing facilities in Kalundborg, Denmark. The company aims to increase production capabilities for GLP-1 drugs, including the popular weight-loss drug Wegovy, as well as other pharmaceutical products.
Meeting Future Market Demands
This significant investment will begin this year and is expected to enhance Novo Nordisk’s ability to meet growing market demands. As the demand for Wegovy surpasses the company’s current production capacity, Novo Nordisk acknowledges ongoing supply disruptions and the challenges faced by some patients in obtaining Wegovy prescriptions.
To ensure continuity of care for existing patients, the company will continue to limit quantities of lower doses of Wegovy within the United States.
Novo Nordisk’s manufacturing expansion coincides with the imminent competition it will face from Eli Lilly & Co.’s newly approved obesity drug, Zepbound, which is set to enter the U.S. market after Thanksgiving.
Boosting Production Capabilities
In addition to increasing production for GLP-1 drugs, the manufacturing investment announced by Novo Nordisk will enhance the production of active pharmaceutical ingredients and packaging. The company plans to construct a new 1.8 million-square-foot facility designed to accommodate future manufacturing processes.
The development and construction projects are scheduled to be finalized between late 2025 and 2029. Furthermore, Novo Nordisk is also awaiting approval for a new production site in Funen, Denmark.
Positive Market Performance
Novo Nordisk’s American depositary receipts have remained relatively stable in early trading on Friday. Year to date, these shares have seen an impressive 48% increase, outpacing the 13.7% gain of the broader S&P 500 index.