By Dominic Chopping

Novo Nordisk expects sales growth to slow this year as capacity constraints, intensifying competition and pricing pressure drag on sales of its blockbuster weight-loss and diabetes drugs.

The Danish pharmaceutical giant expects overall sales growth of between 16% and 24% in constant exchange rates this year, shy of the 26% it achieved in 2024.

"In 2025, we will continue our focus on commercial execution, on the progression of our early and late-stage R&D pipeline and on the expansion of our production capacity," Chief Executive Lars Fruergaard Jorgensen said.

Sales of the company's blockbuster Wegovy weight-loss drug just missed sales expectations in the fourth quarter despite more than doubling on the year.

Sales of Wegovy surged to 19.87 billion Danish kroner ($2.76 billion), against a Visible Alpha consensus estimate of 20.04 billion kroner, while sales of diabetes drug Ozempic rose 12% on year to 33.85 billion kroner, compared with a Visible Alpha consensus estimate of 33.34 billion kroner.

The sales performance comes after Eli Lilly, the company's biggest competitor in the booming weight-loss market, presented a disappointing fourth-quarter sales forecast for its Zepbound and Mounjaro medications. The U.S. company said it had expected faster market growth of the drugs, but wholesalers hadn't boosted their stockpiles at the end of the year as it had expected them to.

The soaring popularity of Wegovy and Ozempic has seen demand far outstrip supply and left the company racing to increase production capacity. It said Wednesday that continued capacity limitations at some of its manufacturing sites are expected to continue with periodic supply constraints and related drug-shortage notifications across a number of products and geographies.

Semaglutide, the drug sold as Wegovy for weight-loss and Ozempic for diabetes, is still currently in shortage in the U.S. according to the Food and Drug Administration.

Novo Nordisk has committed billions of dollars to new manufacturing capacity on top of an $11 billion deal to buy three manufacturing sites previously owned by Somerset, N.J.-based Catalent to boost its production capability. The Catalent deal completed just before Christmas.

As the company approaches the patent expiry of Semaglutide in the early 2030s, it has been working to develop the next generation of obesity drugs that it hopes will accelerate weight-loss and boost other areas of patient health. Data from a keenly-anticipated trial of its CagriSema drug recently disappointed investors as patients lost an average of 22.7% of their weight, missing the 25% Novo had targeted.

The results wiped nearly $100 billion off the company's market value, but shares regained some ground last month after another experimental drug called Amycretin showed encouraging results in an early-stage trial. Still, shares have fallen by around 42% since their peak last summer on the CagriSema disappointment, competitive concerns and pricing pressure.

It said Wednesday it plans to further explore the weight-loss potential of CagriSema with a new phase 3 trial in 2025, but in order to secure supply chain readiness, it now expects to file for the first regulatory approval of CagriSema during the first quarter of 2026. That is a delay to initial plans for a filing toward the end of 2025.

A read-out on CagriSema's effectiveness in obese patients with diabetes is expected during the first quarter of 2025.

Novo Nordisk said it expects continued momentum in both Wegovy and Ozempic this year as well as intensifying competition and continued pricing pressure within its overall portfolio of diabetes and obesity medications.

It guided for operating profit growth this year of 19% to 27% in constant exchange rates.

Novo Nordisk's net profit in the fourth quarter rose 29% to 28.23 billion kroner, ahead of the 26.06 billion kroner forecast by analysts in a FactSet poll.

Sales rose 30% to 85.68 billion kroner, versus the 80.14 billion-kroner FactSet estimate.

Write to Dominic Chopping at dominic.chopping@wsj.com

(END) Dow Jones Newswires

February 05, 2025 03:04 ET (08:04 GMT)

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