Over the last couple of years, Danish company Novo Nordisk (NYSE: NVO) has evolved from a relatively obscure pharmaceutical business to perhaps the biggest rising star in healthcare.
The company's breakthroughs with glucagon-like peptide-1 (GLP-1) agonists gave birth to a host of blockbuster medications that are used to treat diabetes and obesity. Chief among its offerings are Ozempic and Wegovy.
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Below, I'll assess Novo Nordisk's recent third-quarter earnings report, and provide some details on why I'm bullish on the company's long-term road map. Let's explore whether scooping up shares looks like a good opportunity right now.
How was Novo Nordisk's latest earnings report?
Through the first nine months of 2024, Novo Nordisk's revenue increased by 24% year over year to 205 billion Danish krone (approximately $29 billion).
The company divides reported GLP-1 revenue into two categories so that investors can get an idea of how each option is performing. Through the first nine months of the year, sales of injectable GLP-1 diabetes treatments Ozempic and Victoza increased by 26% year over year. In addition, the company's oral GLP-1 medication Rybelsus posted an impressive growth rate of 29% year over year.
Within obesity care, Wegovy and its sibling treatment Saxenda continue to shine -- combining for 44% growth year over year through Sept. 30.
Although it's clear that Novo Nordisk's GLP-1 treatments are a real hit, what do these growth rates really mean? Well, consider that over the last three years, the number of patients globally who are using its GLP-1 treatments have tripled, which translates to 65% of the market in terms of patient volume. To put this into perspective, its chief rival in the weight loss space, Eli Lilly, has an estimated 32% market share.
By all accounts, Novo Nordisk is firing on all cylinders, and the competition isn't even close. And what's even more encouraging is that its lead could widen.
The long-term outlook is robust
Generally speaking, pharmaceutical companies tend to explore additional use cases and applications for their biggest drugs. Diabetes and obesity are no exceptions, as both conditions are often correlated with other important aspects of patient care.
Earlier this year, Wegovy received an expanded indication from the Food and Drug Administration (FDA), which allows it to be prescribed for patients with obesity who are also at risk of cardiovascular conditions such as stroke or hypertension.