Novo Nordisk, BioNxt Solutions, Bayer – The market continues to boom

Novo Nordisk – Increased production capacity

Prescriptions of weight-loss drugs, including Novo Nordisk's Wegovy and Eli Lilly's Zepbound, have more than doubled in the US this year and are expected to remain strong next year. Demand has increased even though many Americans still lack health insurance and must pay out of pocket for the injections, which cost USD 1,000 per month on average. Demand for weight loss treatments has far outstripped supply, with as many as 25,000 new people starting the medication each week.

Analysts expect the market to reach USD 150 billion by 2033. Last month, the Biden administration proposed expanding coverage of weight-loss drugs through Medicare and Medicaid. An estimated 93 million Americans meet the medical criteria for the drugs, but only 52 million are covered by government health plans.

In order to drastically increase production capacity, Europe's most valuable company must grow inorganically. This has now been achieved with the acquisition of the contract manufacturer Catalent by the majority shareholder of Novo Nordisk, Novo Holdings. After paying the purchase price of USD 16.5 billion, including debt, the holding company is passing three of the most important production sites onto Novo Nordisk for USD 11 billion.

From a technical point of view, the Danes' stock was able to stabilize after a correction of over 30% to USD 112.45. The RSI has already generated a buy signal, and the trend follower MACD is about to turn up at a low level.

BioNxt Solutions – Further milestones

Novo Nordisk is also likely to be interested in developments currently taking place at BioNxt, a life sciences company focused on next-generation drug delivery, diagnostic screening systems, and the development of active pharmaceutical ingredients.

Despite the immense success of Novo Nordisk's semaglutide, challenges remain with its injection-based delivery, such as needle anxiety and long-term adherence to therapy. BioNxt has now announced the development of a sublingual thin film or oral dissolvable film (ODF) for semaglutide that is designed to overcome the limitations of existing delivery methods for a therapeutic developed by Novo Nordisk without infringing on the Danish pharmaceutical giant's intellectual property.

BioNxt also announced several milestones in the development of BNT23001, its proprietary sublingual film-or-dissolution (SOD) formulation of cladribine for the treatment of multiple sclerosis (MS), which open the door to marketing applications and clinical trials in the coming year.

Sublingual administration of BNT23001 in pharmacokinetic studies in animal models has achieved high absorption rates of cladribine and confirmed the product's bioequivalence with the original drug Mavenclad. In addition, clinical batch production was secured with the transfer of the manufacture of BNT23001 to the production partner Gen-Plus GmbH & Co KG in Munich. In terms of patentability, a preliminary report highlighted the value of the product for the treatment of MS. BioNxt has entered the national phase for patent protection in Europe, the United States and Canada and expects the patents to be granted by the middle of next year.

Bayer – No sign of a rebound yet

After the sell-off and reaching a 20-year low at EUR 18.41, Bayer shares were only able to recover marginally; at least it does not look like an impulse movement. However, there is still a possibility of further gains up to the EUR 24 mark, where a downward gap was created in mid-November. However, it is difficult to speak of a breakthrough here. Instead, a retest of the support at the yearly lows and further sell-offs seem likely.

In addition to the glyphosate litigation, which remains unclear, the securing of a reserve credit line of EUR 5 billion caused uncertainty. However, the pharmaceutical giant has issued an initial statement. The new credit line merely replaces the old one with a volume of EUR 4.5 billion from December 2018. The new facility has a term of five years, after which two one-year extensions are possible. 23 banks are equally involved in the credit line. In addition, the old credit line has never been used.

In its latest analysis, the major Swiss bank UBS left its rating for Bayer unchanged at "Neutral" with a target price of EUR 22.

The market for weight loss products is growing, and Novo Nordisk has secured the necessary production capacities. The pharmaceutical and agricultural giant Bayer has secured a new credit facility. BioNxt has achieved important milestones in the development of BNT23001 against multiple sclerosis.