10 Nov 2023

Overweight and obesity prevalence is set to cost the global economy 3.3% of GDP by 2060, according to a study by the World Obesity Federation and RTI International

Novo Nordisk is the leading warrior against the obesity pandemic with their much-hailed Ozempic and Wegovy solutions getting even Hollywood and Silicone Valley tongues wagging about the success of their weight loss journeys.  As the largest provider of diabetes-care products in the world, occupying roughly a third of the global diabetes treatment market and around half of the insulin therapy market having exposure to this stock has great long-term benefits.  The inclusion of this stock in the VAM Managed portfolios is another way we give investors the edge.

Says Max Newman of atomos: “The prevalence of diabetes is expected to soar in the coming decades as a result of an increasingly overweight and aging population. The investment case for Novo Nordisk has shifted increasingly towards obesity, as a single molecule called semaglutide that suppresses appetite has emerged as a multi-decade opportunity in the tens of billions of dollars. With a notable first move advantage, Novo and closest peer Eli Lilly may well capture most of this. Through two key drugs, Ozempic and Wegovy, Novo has not only kept its mantle as arguably the best growth story in large cap pharma but has catapulted itself to becoming the most valuable company in Europe. Novo has simply not been able to make enough to keep up with demand, and supply is expected to gradually improve from early 2024. 

We initiated a position in Novo Nordisk towards the end of June in VAM portfolios, prior to the Landmark obesity study (SELECT) that proved to be a major positive catalyst for the company, with its Wegovy drug demonstrating a 20% reduction in the risk of heart attacks, strokes and cardiovascular deaths (MACE-3) in non-diabetic obese patients. The next potential catalyst is on 11th November when the Wegovy SELECT trial is presented to the American Heart Association (AHA) and should further highlight Novo’s mission in that “weight management saves lives.”

We will continue to follow the many advantages of this ground breaking drug and have strong conviction that it will be a big contributor to the success of the VAM Funds outcomes.

Thank you Max Newman for your contribution to this article.

Source: atomos

atomos is the trading name of Atomos Investments Limited, which is authorised and regulated by the Financial Conduct Authority. Atomos Investments Limited is registered in England and Wales, No: 2041819. Registered office: 2nd Floor, 5 Hatfields (alto), London SE1 9PG.

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