Glucagon-like peptide-1 (GLP-1) drugs are rapidly becoming the latest blockbuster in the pharmaceutical industry. However, rising demand has led to shortages, driving companies to scale up their production capabilities.

Danish pharma giant Novo Nordisk is one of the major players in diabetes and weight loss market with its drugs Ozempic and Wegovy (both semaglutide) reporting strong sales. While the firm has invested heavily in its capacity to produce drug substance for semaglutide and other GLP-1 drugs, excess demand remains a major concern for the firm.

According to a text note from financial services firm Jefferies Chad Henry, former general manager and site head at Novo Nordisk said, “Currently all semaglutide active pharmaceutical ingredient (API) for injectable use (Ozempic/Wegovy) is manufactured in Denmark, whereas the vast majority of oral tablet semaglutide (Rybelsus) is manufactured in North Carolina (NC) in the US. Whilst efficiency can improve yields to a certain extent, the only option is to expand capacity.”

Talking about the complexity of Novo’s purification process, Henry added, “It was highly unlikely for Novo to either consider reallocating existing insulin fermentation capacity or be willing to disclose know-how of its fermentation process to a third party.”

“A contract development and manufacturing organization (CDMO) could theoretically do it, but this would take enormous investment to replicate the complexity required for fermentation & purification (relative to the less complex peptide process used by Lilly)."

To remedy this issue and accommodate the increasing demand in the US, Catalent could play a crucial role for the company. In February 2024, investment firm Novo Holdings acquired CDMO Catalent, while it sold three of its drug-product manufacturing facilities to its company Novo Nordisk.

“Novo is very familiar with Catalent’s sites, critically with both Belgium and Indiana already US Food and Drug Administration (FDA)-approved for production of Wegovy. It is feasible to double the capacity at Belgium to approximately 100 to 150 million vials per annum and Catalent’s Indiana facility will potentially produce 70 million vials.”

Furthermore, Henry said if Novo subsidized equipment upgrades and implemented operational efficiencies to the existing lines, it could increase capacity by 20% per annum. Meanwhile, he highlighted that Thermo Fisher Scientific’s Greenville, North Carolina facility currently contributes an additional 70 million vials per annum. However, third-party Wegovy CDMOs have a limited operational capacity, making it imperative for Novo to accelerate in-house production.

In August 2023, Novo Nordisk added Thermo Fisher as an external drug product maker for weight-loss drug Wegovy. Thermo was tasked with filling Wegovy injection pens at its Greenville site, added through the acquisition of Patheon in 2017.