Novo Nordisk A/S, which faces supply bottlenecks amid high demand for its blockbuster weight-loss medicines, will invest €2.1 billion ($2.3 billion) to expand its production in France.
France’s President Emmanuel Macron will officially announce the investment later on Thursday at Novo’s site in Chartres, southwest of Paris, according to his office. A Macron aide didn’t immediately respond to a question of whether the sum also includes public subsidies.
The Danish company is working to boost production of two sister medicines, Wegovy for weight loss and Ozempic for diabetes, and their injection pens amid booming demand. The frenzy around the drugs, endorsed by celebrities and entrepreneurs including Elon Musk, turned Novo into Europe’s most valuable company, sending its stock up by about half this year.
The investment will bring more than 500 jobs, Macron’s office said.
There are shortages of both injected medicines, which contain an active ingredient called semaglutide that mimics the action of a gut hormone, making people feel full.
Wegovy has been shown to help users shed about 15% of their body weight on average, and recent studies also demonstrated heart benefits. Novo has so far only introduced the drug in a handful of countries. Access in France is restricted to morbidly obese patients with another risk factor such as heart disease or sleep apnea.
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Spurring a reversal of the country’s industrial decline has been one of Macron’s key economic goals and he laid out a series of measure earlier this year to try to do so, including expanded use of tax credits for investment and streamlining procedures to open new factories.
France’s attractiveness as a place to invest may also get a boost from a court decision in Germany last week. That country’s government was forced to put in an emergency spending freeze as it assesses the implications from the court’s ruling that some €60 billion couldn’t be transfered to a fund aimed at supporting a range of industrial projects.
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The Danish drugmaker is racing to build out factories and production lines as competition intensifies in a weight-loss market estimated to hit $100 billion by the end of the decade. Earlier this month Novo unveiled a plan to invest more than $6 billion to build a 170,000 square-meter manufacturing facility in Denmark.
Thursday’s news comes on top of a €130 million investment into expanding capacity in Chartres that Novo announced in January. The site currently employs 1,450 people and produces insulin used by more than eight million patients worldwide.