How a food regimen tablet boosted the boom of Denmark’s economic system

The Danish financial system grew by way of 1.9% in the first quarter of the year, one of the maximum powerful increase in the European Union. But his data office reckons that real boom is zero.2% and that everything else, 1.7%, is due to the income of a single organisation, Novo Nordisk.

The organisation is a century old and has never had such importance in the Danish financial system, however since remaining year it has grown like mushrooms in the rain and its stock price is already identical to the Danish GDP, extra than 350,000 million euros.

What occurred? Novo Nordisk is the manufacturer of two of the maximum modern drugs of latest years, the anti-weight problems Ozempic and Wegovy, specifically the primary for its marvelous success within the United States.

The employer, one of the oldest European pharmaceutical businesses, has been making diabetes medicines for nearly a century. And so it persisted till in 2017 the US employer in price of approving the use of drug treatments approved Ozempic against diabetes and in 2021 it did the identical with a comparable remedy, Wegovy.

Originally designed towards diabetes, it changed into observed by means of accident that have weight loss as a facet impact. And even though it isn't known what causes the drug to provide this end result, inside the United States it is being hugely prescribed in opposition to weight problems.

What is known is that it could purpose malnutrition due to the fact the effect is not weight reduction because of improved metabolism, however as an alternative due to the fact reduces urge for food. It also produces facial growing old and addiction. For now it's far injected, however studies is progressing to turn it right into a pill.

The Danish enterprise Novo Nordisk, maker of the weight-loss capsules which are a hit within the United States. Photo: REUTERS

Rising stocks and economic increase

The monetary impact of the vast growth of the organization alters all of the macroeconomic statistics of the u . S ., from the GDP to the want for its Central Bank to maintain hobby fees. Denmark is within the European Union however maintains its very own foreign money and with it its issuer.

The company has become in a completely quick time within the second most precious on the European continent after the French LVMH, devoted to luxurious products.

The Danish government do no longer disguise the fact that the powerful financial increase has no other clarification than Novo Nordisk and its anti-diabetes drugs changed into anti-obesity drugs, and that it is not their financial policies, just like the ones of the entire of Europe. What they do already do is announce that they'll must make data that dispose of the effect of the corporation so as now not to modify all of the information in the united states.

The impact commenced with that pressure remaining 12 months, while the government already warned that  thirds of the u . S .’s boom became because of the income of pharmaceutical corporations, however it become Novo Nordisk and its two pills that defined all of the upward push. The agency’s profits inside the first half of this year had been forty five% better than inside the preceding 1/2 and reached $five.7 billion.

The company has started to restrict the quantity of those two tablets that it sells in the United States whilst seeking to growth its manufacturing to satisfy even better demand forecasts. Thousands of docs in the United States prescribe their anti-obesity pills in a rustic with more than 100 million obese humans.

The business enterprise has not created jobs on the price of its growth nor does it intend to, because a terrific part of its production is performed in plant life in the United States, however it does pay its taxes in Denmark, where it is inflating the coffers of the employer like no other business enterprise. Treasury Administration.

The Central Bank of Denmark is also seen before a predicament. Novo Nordisk need to vastly buy crowns to repatriate its income in different currencies, including dollars or euros. This triggers the cost of the nearby forex, which places the Central Bank at the ropes, whose task by law is to keep the fee of the crown connected to the fee of the euro. Thus, the Central Bank should vastly buy foreign currencies and hold its interest fees beneath those of the euro so as not to attract too many investments.

Could Denmark emerge as too dependent on Novo Nordisk? Some analysts evaluate the situation with the dependence that Finland as soon as had on the era business enterprise Nokia, which dominated the mobile telephone marketplace many years ago.