Before the Bell: Novo Nordisk Wins the Battle Against Eli Lilly

The Danish pharma group leads the rally toward the obesity pill, while Alphabet shows that securing energy supply remains a top priority.

Markets were fully dressed in Christmas colours yesterday, with plenty of red in Europe and just as much green on Wall Street. The Nasdaq (+0.5%) and the S&P 500 (+0.6%) put in a solid performance. Alphabet (+0.9%) agreed to pay 4.75 billion dollars to acquire a privately held specialist in solar parks and battery storage, as part of its effort to secure energy supplies for artificial intelligence. In the same sector, SolarEdge gained 6.4%. On the Copenhagen exchange, however, Vestas closed 2.7% lower. Earlier in the day, the Danish wind turbine manufacturer was even down 5.8% after the U.S. government decided to suspend permits for several large offshore wind projects. The U.S. president is, after all, no fan of wind turbines. In Europe, equity markets declined by an average of 0.3%. On the Amsterdam exchange, AMG gained 3.5%, while carmaker Stellantis lost 4.5%. The Bel20 closed 0.4% lower. Within the index, D’Ieteren managed to rise 3.2% after announcing the restart of its share buyback programme. Ageas (+1.9%) also moved higher. But three heavyweights—Argenx (-1.3%), UCB (-1.5%) and AB InBev (-2.5%)—still pushed the index into the red.

This morning, there is a modest uptick on the markets in Tokyo (+0.2%) and Hong Kong (+0.1%). Later today on Wall Street, citrus and avocado producer Limoneira and restaurant chain Good Times Restaurants will still publish late quarterly results.

Will There Be Enough Electricity?

Yesterday, Alphabet (+0.9%) announced a major investment in renewable energy. In a 4.75 billion dollar deal, the tech group is acquiring Intersect Power LLC from private equity investor TPG. Intersect develops large-scale solar parks and battery storage projects specifically designed to power energy-hungry data centres. Alphabet already held a minority stake in the company. By fully acquiring Intersect, Alphabet aims to secure its electricity supply as AI and cloud computing rapidly drive up power demand. Alphabet is certainly not the only company preparing for a surge in electricity consumption. Microsoft, Amazon and Meta have also announced long-term power contracts to supply their data centres with nuclear energy. Microsoft and Amazon are betting on nuclear power, while Meta is currently opting for wind and solar energy. The common thread is clear: big tech is anticipating a structurally rising demand for electricity. An article on this topic was previously published on Spaarvarkens.

Boost for Novo Nordisk

It is never easy to make up lost ground. That is why it pays to be first. In the race for the obesity pill, Novo Nordisk is currently leading the pack. The Food and Drug Administration approved the pill version of Wegovy after market close yesterday. This means Americans will soon be able to take a monthly pill—at a cost of roughly 149 dollars—to lose weight. Thanks to this decision by the U.S. drug regulator, the Danish company now holds a golden ticket. At the headquarters of arch-rival Eli Lilly, there was undoubtedly some loud swearing. The world’s largest pharmaceutical company recently reported excellent trial results for orforglipron, but those results count for little if the pill cannot yet be brought to obese patients. Score one for Novo Nordisk. It is now up to Eli Lilly to secure FDA approval for orforglipron as quickly as possible. To be continued.

Did you know…

that the market for anti-obesity drugs is estimated at 26 billion dollars this year, but could grow to 83 billion dollars by 2032? In addition to the United States, these products are also expected to see strong growth in Asia.

This article was translated from Dutch and was originally published on Spaarvarkens.be.