A pharma company helping Elon Musk shed weight is now worth more than the entire economy of Denmark

The company has effectively cornered the U.S. market thanks to being the only FDA-approved manufacturer of a blockbuster pharmaceutical called semaglutide, the active chemical behind Ozempic and Wegovy that treat Type-2 diabetes while also helping Elon Musk shed weight.

Since 2020 the stock has tripled with the U.S.-listed company now worth over $400 billion on the stock exchange, putting it within arm’s reach of dethroning French centibillionaire Bernard Arnault’s luxury brand group LVMH as Europe’s largest company by market cap.

“We are serving more patients than ever before,” crowed CEO Lars Fruergaard Jørgensen said in a statement on Thursday, after hiking his full-year sales and earnings targets on the back of ever rising demand for his semaglutide treatments.

Semaglutides work by prompting the body to produce more insulin, which helps diabetes patients reduce the amount of sugar in their blood. But in higher dosages it also interacts with the parts of the brain that regulate appetite by creating a false feeling of being full.

Novo Nordisk’s Jørgensen said his company helped 39 million people across the world tackle diabetes and weight-loss in the first half of 2023, four million more than the prior year period.

As a result, sales rose by nearly a third, as demand for its obesity care treatments alone surged a staggering 157%, due in large part to the wide popularity of Wegovy in the U.S. This is the kind of growth more common for a tech startup than company that has already been around for a century.

“It is not often that you have a 100-year-old company and you’re still growing at 30 percent,” the CEO told reporters on Thursday, according to the Financial Times.

An optimistic earnings outlook wasn’t the only cause for celebration for Novo Nordisk this week. The company’s shares surged to record highs after a study on Tuesday revealed that Wegovy also reduces the risk of heart attacks and strokes by 20%, marking a paradigm shift in the realm of obesity treatments.

That was when Novo Nordisk’s market value vaulted past the annual size of Denmark’s own economy, estimated at more than $400 million.

The Danish pharma giant’s executive vice president, Martin Holst Lange, said Wegovy now “has the potential to change how obesity is regarded and treated” following the release of the late trial results by the company.

Meteoric rise of Novo Nordisk’s weight-loss drugs

Obesity, a chronic disease leading to excessive weight gain, has been a subject of stigma and with few avenues of safe medication. Predictions by the World Obesity Federation suggest that by 2035, one in four people will be obese if current trends continue.

Given the rising threat of this disease, the Danish drugmaker was brought to the forefront on obesity treatment after its injectables proved to cut weight down by around 15% on average when combined with lifestyle changes. 

The U.S. Food and Drug Administration approved Ozempic to treat Type 2 diabetes in 2017, while Wegovy was approved in 2021—making it the first ever weight-loss drug to be approved by the body in eight years. The drug instantly became popular, with the likes of Elon Musk crediting Novo Nordic’s wonder drug for helping him shed pounds after he was fat-shamed by his own estranged father last year. 

The effectiveness and subsequent rise in demand for Novo Nordisk’s “miracle” drugs led it to curb supply for some starter doses. The company intends to keep those restrictions in place and expects there to be supply shortages in the coming months “across a number of products and geographies,” it said on Thursday during its earnings call. In some ways, the scarcity helped further feed into the drugs’ popularity with more buzz surrounding the obesity drug.

The demand-supply mismatch has led to a new crop of off-brand versions of Ozempic and Wegovy, which the FDA has warned consumers against.  

“They’re not for everyone, but they can be a godsend, a game-changer for those for whom they’re clinically appropriate,” Zach Reitano, CEO of healthcare company Ro, told Fortune earlier this year.