Sep 7, 2023 - Economy

Novo Nordisk, maker of Ozempic, unseats LVMH as European stock market’s largest company

Data: FactSet; Chart: Axios Visuals

Excitement over obesity drugs has made Novo Nordisk the new heavyweight champion in the European stock market.

Why it matters: The surge in Novo's shares this year propelled it past luxury goods giant LVMH and Swiss food conglomerate Nestlé to become the largest company by market cap in Europe. The fresh title reflects growing excitement about the potential for Novo's drugs, Ozempic and Wegovy, to revolutionize the treatment of obesity.

The latest: Last month Denmark-based Novo Nordisk reported that profits surged 43% in the first half, to 39.24 billion Danish krone — or roughly $5.6 billion.

  • The company's profits are so large, relative to the size of the Danish economy, that they have been skewing key economic statistics, the New York Times recently reported.

What to watch: How long Novo Nordisk's lead will last.

  • The pharmaceuticals at the heart of the boom mimic a hormone that's secreted in the gut and helps regulate blood sugars and appetite.
  • Eli Lilly's fast-selling Mounjaro — a diabetes drug that also mimics the appetite hormone, and is being used off-label for obesity treatment — may get official FDA approval for use for obesity this year.

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