(Bloomberg) -- Novo Nordisk A/S has secured land and planning permissions for what may be its next major factory site in Denmark as the 100-year-old company works to meet soaring demand for its weight loss drugs.
The producer of Ozempic and Wegovy signed an agreement earlier this month to buy a 200-acre plot in Odense after the city council greenlit its planning proposal. The company will start preparatory excavation work on the southern part of the site soon, a spokesperson said by email, and following an internal review Novo will make a final decision on whether to invest in the new site at the end of the year.
The potential development on the outskirts of Denmark’s third-largest city comes as Novo races to ramp up supplies of its diabetes and weight loss medicines. In the past 14 months, the company has announced multi-billion-dollar factory expansions in Denmark, France and the US. In June, Novo said it expected to invest $6.8 billion in production this year, up from $3.9 billion in 2023.
The success of its semaglutide-based drugs has transformed Novo into Europe’s most valuable company and triggered worries over Denmark’s reliance on the drugmaker’s success. The Danish economy expanded almost 2% last year, but would have stagnated without Novo’s contribution.
Odense, about a two-hour drive from Copenhagen, would be a new location for Novo. The company has yet to reveal what the site would be used for, but an environmental report submitted as part of the permitting process includes plans for a fill-finish facility, in which medicine is prepared and loaded into injector pens. The site is less than 60 miles from Kalundborg, where Novo produces the key ingredient in Ozempic and Wegovy.
In the environmental impact report, Novo laid out plans to build a packaging facility on the Odense site by 2026, and to potentially add plastic molding and assembly facilities for its pharmaceutical pens by 2030. If all expansion scenarios are pursued, construction of as many as seven buildings will take place in stages over an 11-year period. The company has already begun advertising for jobs in Odense in the area of fill-finish expansion.
Novo’s facilities have had a huge impact on the areas they’re located in. In addition to creating growth and jobs, they’ve also led to tensions in cases where the company has been accused of interfering in local politics. In Odense, where an expansion could mean at least 3,000 additional people commuting by car to the site every day, according to a Novo analysis, the city council and drugmaker have held open meetings in recent months to allow residents to ask questions and raise concerns about the proposal.
Not all of the company’s recent expansion plans have come to fruition. Novo backed away last month from a project on the outskirts of Dublin, although it is still moving ahead with a smaller facility in the central Irish town of Athlone.
--With assistance from Christian Wienberg.
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