Novo Nordisk (NYSE:NVO) became Europe’s largest company for a short time today as investors continued to pile into the Danish drugmaker following the recent trial of fat-busting drug Wegovy.
Shares in Novo have jumped 17% since the trial showed that not only can Wegovy trim the waistline but cuts the risk of heart attack or stroke by a fifth.
At the open this morning, Novo Nordisk (NYSE:NVO) had a market capitalisation of $421 billion, just edging out French-listed luxury brands group LVMH off the top spot.
LVMH had previously been on top since February 2021 when it took over from Nestle.
The French giant subsequently regained its crown, but with demand for fat-reducing drugs soaring, especially in the US, experts suggest it might struggle to hold off the rising Danish group for long.
Barclays forecasts weight loss drugs to become a US$100 billion market within 10 years, up from US$6 billion currently, with Novo Nordisk (NYSE:NVO) and US group Eli Lilly leading the way.
Eli Lilly is expected to get US approval for a weight loss label for existing treatment Mounjaro later this year.
In June, it also stunned the medical profession with results from a trial for a new weight loss drug, retatrutide
"Novo closing in on LVMH as Europe's biggest market cap stock is a reflection of Novo's recent product success while LVMH's recent trends have been more mixed," Marcel Stotzel, co-portfolio manager of Fidelity European Fund and Fidelity European Trust, told Reuters.
Wegovy currently costs $1,300 a month in the United States.