Novo Nordisk Set to Slash Victoza Production to Boost Ozempic Supply

In response to the escalating demand for its GLP-1 weight loss products, Novo Nordisk is adopting a new approach. The company is adjusting its manufacturing strategy by decreasing the production of the diabetes drug Victoza to allocate more resources to the production of Ozempic. 

The company, in collaboration with the European Medicines Agency (EMA), disclosed this strategic shift in a letter addressed to healthcare professionals. The letter emphasized the increasing shortage of both medicines, a situation expected to become more pronounced throughout the remainder of the fourth quarter.

The scarcity of Victoza is anticipated to endure until the second quarter of the upcoming year. In response, the EMA has advised healthcare providers against initiating new patients on the drug until that time. While both Victoza (liraglutide) and Ozempic (semaglutide) belong to the GLP-1 drug class, Victoza, initially approved in 2010, is not prescribed for weight loss.

Ongoing shortages of Ozempic are foreseen throughout 2024, although improvements in the overall supply are expected in the first quarter of the upcoming year, as outlined in the letter. Novo Nordisk will restrict the supply of initial doses of Ozempic (0.25 mg) to help manage the new patients. Additionally, the EMA recommends that doctors “limit” the commencement of new users during this period.

The surge in demand for GLP-1 drugs, driven by celebrity endorsements and social media, has propelled a weight loss craze. Novo Nordisk, followed by Eli Lilly, witnessed an exponential increase in demand for these drugs, despite many users bearing the full cost, which can surpass $10,000 annually.

To meet this heightened demand, both companies are making substantial investments, with Novo allocating $6 billion. Meanwhile, Lilly aims to double its manufacturing capacity for weight loss products by the end of the current year compared to the beginning.

During the third quarter, the robust performance of Ozempic, generating sales totaling $3.3 billion, and Novo’s obesity treatment Wegovy – essentially an elevated dose of the same drug – contributed significantly with sales amounting to $1.4 billion. This combined success accounted for more than 55% of Novo’s overall revenue, reaching $8.4 billion. Also noteworthy is Novo’s earlier achievement this year, securing the position as the most valuable pharmaceutical company in Europe, as measured by market capitalization.

Meanwhile, in the U.S., Lilly has attained a similar esteemed status, with much credit going to the development of tirzepatide. This dual-action blood sugar modulator has exhibited superior effectiveness in promoting weight loss, as supported by various studies. In the third quarter, Lilly’s diabetes product Mounjaro reported substantial sales of $1.4 billion. Adding to their achievements, Lilly recently celebrated FDA approval for Zepbound, its obesity drug, which shares an identical formulation and dosage profile with Mounjaro.

Due to the overwhelming demand for Ozempic as a weight loss treatment, certain diabetes patients are facing challenges in accessing the medication. To manage the situation and ensure a more equitable distribution of the medication, some European countries have taken measures, such as halting its export and implementing restrictions on its use.

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