Shares of Novo Nordisk surged more than 8% to record highs, bringing the company up in the global rankings to the 12th most valuable company in the world, up from 14 previously, after it told investors a Phase I trial of the pill version of experimental drug amycretin showed participants lost 13.1% of their weight after 12 weeks.
Novo's shares have risen more than three-fold since June 2021 when it launched Wegovy in the United States, which helped it in becoming Europe's most valuable listed company, ahead of LVMH.
Its value of $566 billion on Thursday placed it ahead of Tesla and Visa, according to LSEG data.
"Novo has made clear that the amycretin molecule likely will form the foundation of the company's rapidly growing pipeline," said Guggenheim analyst Seamus Fernandez.
Nearly half of Novo's valuation is based on its new experimental weight loss drugs, according to analysts.
Wegovy is in a class of drugs called GLP-1 agonists and was originally designed to treat type 2 diabetes. This class of drugs reduces food cravings and empties the stomach more slowly.
Amycretin targets a hormone called amylin in the pancreas that affects hunger.
Wegovy was the first in a new group of historically effective weight loss drugs to be launched, with Novo and Eli Lilly becoming industry leaders in the field.
The obesity market could possibly be worth $100 billion by 2030 according to industry analysts. A boon for the company was the discovery last summer that Wegovy has a positive effect on the heart as well.
"Any company that is so heavily exposed to one therapeutic area needs to try to develop other pillars to stand on," said Wolfgang Lickl, portfolio manager at KB-Vermögensverwaltung."The sheer success in diabetes and obesity will make that difficult, but the cardiovascular field makes sense because of the many synergies," he added.
After the August trial, Novo has been trying to persuade hesitant medical insurers that Wegovy's long -term advantages will alleviate the strain on healthcare systems and diminish the expenses associated with treating heart disease in overweight and obese individuals.
