31 January 2024
If you are covering GSK or Novo Nordisk’s latest results, please see the following comments from Sheena Berry, healthcare analyst at Quilter Cheviot:
GSK
"GSK has reported a solid quarter, underlining its steady performance in the pharmaceutical sector. Something of note is the 17% growth in 2023 for Shingrix, GSK's vaccine for shingles.
"The introduction of Arexvy, GSK's vaccine aimed at preventing lower respiratory tract disease caused by the respiratory syncytial virus (RSV) in individuals 60 years and older, has also been well-received. Since its availability in US retail pharmacies in August, the vaccine has seen strong demand, indicating a positive response to its early launch in the US market.
"Looking ahead, GSK has updated its outlook, predicting underlying operating profit growth in the double digits between 2021 and 2026. Despite the challenge posed by the expiration of a crucial HIV patent in the coming years, GSK expects to maintain stable operating margins through this period.
"GSK continues to prioritise enhancing its pipeline and product offerings through business development.
Novo Nordisk
"Novo Nordisk emerged as a standout performer in 2023, largely owing to the significant opportunities identified in the obesity treatment market. The company's fourth quarter results surpassed expectations, primarily fuelled by the success of Ozempic, a medication approved for managing type 2 diabetes.
"While the company's obesity drug, Wegovy, did not meet expectations, this shortfall is attributed to production constraints rather than a lack of demand. Novo Nordisk faced challenges in meeting the high demand for Wegovy, leading to a decision to restrict supply in May 2023. However, the company has announced that it is progressively increasing the supply of Wegovy's lower dose strengths, signalling a positive move towards meeting market demand.
"Looking forward, Novo Nordisk's growth outlook remains compelling. The company's strategic focus on expanding its portfolio in the diabetes and obesity markets positions it well for sustained growth. The proactive measures being taken to address supply issues with Wegovy also highlight Novo Nordisk's commitment to overcoming operational challenges and capitalising on the significant demand for effective obesity treatments.
"Novo Nordisk is well-positioned to leverage opportunities in the evolving healthcare landscape and its growth looks attractive"
