Novo Holdings, the asset manager for the philanthropic Novo Nordisk Foundation, is set to invest up to $7 billion annually by 2030, thanks to the success of Novo Nordisk’s weight-loss and diabetes medications.
With a portfolio valued at approximately $26 billion at the end of 2022, Novo Holdings intends to invest $5 billion per year over the next five years. By 2030, it plans to increase its annual investments to $7 billion. The company invests in life science companies and manages various assets, including equities, bonds, real estate, and infrastructure assets. It also holds controlling stakes in Novo Nordisk and enzyme maker Novonesis.
Novo Nordisk witnessed a significant 31% increase in overall sales in 2023 compared to the previous year. It anticipates further growth of 18% to 26% this year, driven by the high demand for its popular diabetes and weight-loss drugs, Ozempic and Wegovy.
Due to the overwhelming demand for these drugs, Novo Nordisk has had to impose limitations on supplies while actively working to enhance its production capacity.
In a recent development, Novo Holdings agreed to acquire New York-listed contract manufacturer Catalent for $16.5 billion. As part of the deal, Novo Nordisk will purchase three Catalent manufacturing sites for $11 billion. Initially, Novo Nordisk will fulfill existing contracts at these sites for third-party products before transitioning to focus on its own drug production.
Catalent, with more than 50 sites, aligns with Novo Holding’s commitment to investing in life sciences companies in support of the Novo Nordisk Foundation’s mission and philanthropic causes. While additional sales of Catalent assets are not part of its core strategy, Novo Holding believes that there is substantial untapped value within the business.
“We recognize the significant market opportunity in Catalent’s areas of operation, and we are confident that there are further avenues for growth and value creation,” stated Christoffer Soderberg, Managing Partner, Principal Investments, at Novo Holdings.
Overall, the success of Novo Nordisk’s medications has not only driven growth for the company but also paved the way for increased investments by its controlling shareholder, Novo Holdings. These investments will support the advancement of their portfolio and long-term goals in the life sciences sector.
