(Bloomberg) -- Novo Nordisk A/S sales surged in the third quarter and double-digit growth should carry into 2024, driven by burgeoning demand for its obesity and diabetes blockbusters. 

Revenue jumped 38% to 58.73 billion kroner ($8.3 billion) excluding some items, the Danish drugmaker said Thursday, strengthening its grip on an obesity market estimated to hit $100 billion by 2030. Operating profit also rose 47% during the period. 

Novo has vaulted into the limelight as Wegovy and another related medicine for diabetes, Ozempic, proved they could help people shed unwanted weight by curbing their appetite. Wegovy sales hit nearly 10 billion kroner during the period, ahead of expectations even as it continues to battle with supply issues. 

Novo shares rose more than 3% in early trading. The stock has almost doubled in the past two years, helping the company overtake behemoths like Nestle, L’Oreal and luxury-goods giant LVMH to become Europe’s most valuable company. 

About 95% of sales of Wegovy are in the US, where the pharma group is struggling to keep up with demand. While the company is investing to boost supply capacity, it still expects to periodically face constraints and shortages in the US and elsewhere. For now, it’s restricting starter doses for Wegovy — which can help patients lose about 15% of their body weight — to safeguard supplies for people in the US who are already on the medicine, the company said. 

Potentially 50 million Americans could need access to obesity drugs right now and more people are willing to opt into treatment, according to Novo Chief Executive Officer Lars Fruergaard Jørgensen. Novo is currently treating about 500,000 US patients. 

“We’re pleased with our ability to gradually expand and treat more patients,” he said on a call with reporters. “We have a growth strategy and we can deliver according to that.”

He declined to go into details about when new factories or production lines will come online to help ease supply constraints.

Read More: Novo Nordisk Drug Supply Key to Rosy Prospects: Earnings Outlook

Sales of Novo’s treatments for diabetes, including Ozempic, Rybelsus and Victoza, rose by nearly 50% during the period. The company said it aims to have more than one-third of the global diabetes market by 2025.

“Overall a strong set of numbers from Novo Nordisk - driven by Wegovy,” Brian Godsk Borsting, a credit analyst at Danske Bank A/S, said in a note. “The coming years will benefit further from a wider launch of Wegovy in various markets.”

Gold Rush 

The success of weight-loss drugs has sparked something of a gold rush in the pharma industry, and some analysts predict this class of treatments could become one of the biggest-ever blockbusters. 

Novo has already raised its full-year outlook for revenue and profit for a third time, saying operating profit may jump by as much as 46%, fueled by Wegovy and Ozempic sales. The injected medicines share the same active ingredient and work by suppressing patients’ appetite as well as slowing the movement of food through the digestive tract.

Read More: All About the New Obesity Drugs Causing a Big Stir: QuickTake

About 40 companies are chasing after Novo to grab a share of the market, led by Eli Lilly & Co., which expects to get US approval to use its Mounjaro diabetes drug to treat obesity this year.

Competition with Eli Lilly is a good thing for both companies and societies, since it will create a greater market for obesity medicines and drive innovation, said Fruergaard Jørgensen. 

“It keeps both companies on their toes,” he said. “I think it’s a very positive situation to be in.”

Analysts at Goldman Sachs Group Inc. predict the market for obesity drugs could reach $100 billion by 2023, with Lilly and Novo together capturing about 80% of the obesity market in 2030. 

Novo recently launched Wegovy in Denmark, Norway, Germany, the UK and Iceland, and plans to add some additional markets later this year and in 2024, Novo’s Chief Financial Officer Karsten Munk Knudsen said. The company learned lessons from its US launch experience and is being careful to only introduce the medicine to new patients in countries where it’s confident it can meet demand, he said. 

Part of the excitement about Novo’s Wegovy is that recent clinical trials show that it reduced not just weight but also the risk of heart attacks and strokes. The study may aid Novo in reimbursement discussions with insurers who might otherwise balk at the cost of Wegovy which can run into thousands of dollars a year per patient. Obesity drugs more broadly are also being studied to see if they may potentially help combat other ailments including kidney disease and Alzheimer’s.

“Addressing one of the gateway conditions — obesity — and thereby addressing a number of comorbidities is, we believe, a very good addition to society,” Fruergaard Jørgensen said on a call with reporters. “We also believe it’s really good business.”

--With assistance from Lisa Pham, Dani Burger and Manus Cranny.

(Updates with CFO comments from interview, adds other details)

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