Sales of weight loss drugs surge, Novo Nordisk (NVO.US) beats Q3 earnings expectations

Novo Nordisk (NVO.US) reported its Q3 earnings on November 6. The results showed that Novo Nordisk's Q3 net sales were DKK71.311bn, up 22% YoY; its net profit was DKK27.301bn, up 21% YoY, better than the market's expectation of DKK26.7bn. The gross profit was DKK60.003bn, up 22% YoY; its gross margin was 84.1%, lower than the market's expectation of 84.5%. The operating profit was DKK33.822bn, up 26% YoY; its operating margin was 47.4%, higher than the market's expectation of 46%. Notably, the highly anticipated blockbuster weight loss drug Wegovy's Q3 sales were DKK17.304bn, up 79% YoY, better than the market's expectation of DKK15.6bn. Despite the price cut, Wegovy's sales in the US market grew by about 50% after more insurance companies agreed to cover the cost of the drug. This eased investors' concerns as Novo Nordisk's rival Eli Lilly (LLY.US) reported disappointing Q3 sales of Zepbound last week. So far, the biggest obstacle has been meeting the demand for weight loss drugs. Novo Nordisk and Eli Lilly have both committed to investing billions of dollars to increase production capacity while trying to convince more insurance companies to cover the cost of weight loss drugs. Novo Nordisk said on Wednesday that it expects the cyclical shortages of "multiple products and regions" to continue this year. Looking ahead, Novo Nordisk expects its full-year sales to grow 23%-27% YoY at constant exchange rates, down from the previous expectation of 22%-28%; it expects its full-year operating profit to grow 21%-27% YoY, down from the previous expectation of 20%-28%.