A company being too valuable can bring huge problems to your country. or incredible benefits. Nokia This is an example. For years, the Finnish economy was dominated by mobile brands, representing 4% of the country’s GDP at its peak. The decline of the brand, however, This led to a decade of economic stagnation in Finland. Its collapse in 2008 exacerbated the country’s woes.
Denmark faces a similar situation. Above is the market capitalization of its largest company, Novo Nordisk 570 billion dollarsmore your GDP. The culprit: Ozempic.
Olympic success. Rising demand for weight loss treatments has skyrocketed Novo Nordisk’s fortunes. Company Corner the US market Thanks to the success of semaglutide, the active chemical behind Ozempic, a type 2 diabetes drug, and wegovy, a treatment for obesity. The weight loss industry makes money.
sale, sale. It became the largest company in the European Union by market capitalization, According to company market cap, over $633,000 million, significantly more than second (AML) and third (LVMH). a year ago FactSet Analyzer They have already estimated that Novo Nordisk’s drug sales will reach 6 billion in 2023 and 15,000 million in 2027.
This has had an impact on the Danish economy. The global obsession with losing weight Already affecting Denmark’s economy. To understand why, you need to understand that its currency, the crown, is linked to the euro. Central bank strategy with this interest rate and other interventions to stabilize its value with the European currency. As exports from the pharmaceutical industry have increased greatly, the Danish economy has a large inflow of foreign currency.
As a result, Denmark has kept rates below the European Central Bank rate, The crown is weak. Novo Nordisk’s growth is masking other weaknesses in Denmark’s economy. Data from Denmark Statistics for 2023 shows that without the contribution of the pharmaceutical industry, the GDP would have decreased by 0.1%.
result. Just one company contributing so much to the country’s coffers means its economy is more vulnerable, with Novo Nordisk becoming the “Nokia of Denmark” since a possible collapse. Can drag down the entire economy. Its economy is blocked. A sudden crisis or the emergence of competitors at Novo Nordisk, which is already marketed in the US, is a threat.
well. But it also has positive aspects. Novo Nordisk’s success is a miracle for job creation as it invests nationally. Additionally, lower interest rates will also benefit home buyers who can afford them Slightly lower mortgage rates Compared to the rest of Europe.
What do they sell? A solution to obesity, a growing health problem almost all over the world. Especially at a time when data from the World Obesity Federation suggests that by 2035, One of the four People will be obsessed with following this trend. Ozempic’s “miracle” properties are real, although there is widespread uncertainty about its rebound effect and other side effects.
Apart from these limitations, pharmaceutical companies are testing a weight loss pill that has revolutionary potential. The key is in its composition. Semaglutide Forces the body to produce more insulinIt helps in reducing blood sugar in diabetic patients. At high doses, it also interacts with parts of the brain that control appetite, creating feelings of satiety.
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*An earlier version of this article was published in August 2023