Back before Ozempic, when Kate Mulroney (MBA 1984) spoke at technical conferences about her work at Novo Nordisk, people often assumed she was talking about Novartis. “I’d have to explain that’s a Swiss company; we’re Danish,” says Mulroney, now head of advanced analytics and innovation for the US affiliate in Plainsboro, New Jersey. That all changed when its breakthrough drug for type 2 diabetes, Ozempic, hit the market in 2018. By some biochemical mystery, it also turned out to be a powerful tool for weight loss—which led to the FDA’s 2021 approval of Wegovy, marketed for weight loss. Suddenly everyone everywhere was talking about the smallish Danish company, as its story migrated from medical journals into mainstream and social media. Once Jimmy Kimmel opened the 2023 Academy Awards with a joke about Ozempic, the drug’s household-name status was sealed.

Yet the runaway success of these drugs, known as GLP-1 agonists, amounts to so much more than media buzz. In just a few years, they have ignited a wave of change that has transformed Novo Nordisk into Europe’s most valuable public company. The seismic shift is on track to continue reshaping the company, the entire pharmaceutical industry, philanthropic efforts, and potentially global health for years to come.

The difference inside the company already feels like “night and day,” says Mulroney, who’s been there since 2004. At that point, Novo Nordisk had been primarily a niche insulin manufacturer. That work dates to 1923, when two scientists won the Nobel Prize for their discovery of the miracle drug. Before that, doctors had few tools to treat people with diabetes, so the autoimmune condition was often fatal. Insulin became Novo’s steady business for much of the 20th century, but as lifesaving as it was for people with diabetes, insulin itself never amounted to a huge market. By 1980, about 108 million adults were living with (mostly type 1) diabetes, and the global insulin industry was valued at half a billion dollars. The arrival of type 2 diabetes led to a significant rise, tripling demand. By 2023, Novo Nordisk controlled almost half of the global insulin market.

Then came Ozempic, which turned Novo’s balance sheet on its head. The business that for a century had considered itself a diabetes company saw its earnings from diabetes products fall from 81 percent in 2017 to 25 percent in 2023. Net sales, meanwhile, climbed from $16.2 billion to $33 billion in that same period, riding the GLP-1 wave. Novo Nordisk’s valuation has shot up to almost $600 billion, which is more than the entire Danish GDP. And the top of the curve is still out of view: The World Health Organization estimates that 500 million people worldwide are obese. The total addressable market for weight-loss drugs is almost unthinkable, especially considering that these drugs are prescribed for life.

“They thought they were sitting in an airplane, and it turns out they’re in a rocket,” says HBS professor Joseph Badaracco, who co-wrote the 2024 case “Market Dynamics and Moral Dilemmas: Novo Nordisk’s Weight-Loss Drugs.” Part of what makes the story so fascinating, in his view, is the fact that we can’t yet see the scope of the potential.

“Every other news cycle, there seems to be another serious medical condition that these GLP-1s may be able to help, for reasons we are just beginning to understand,” Badaracco says. Take, for example, the fact that in March the FDA approved Wegovy as a treatment to reduce the risk of potentially deadly cardiovascular events. A study published in May found that Ozempic could significantly lower the risk of complications from chronic kidney disease. Then in July, researchers announced that a similar drug slowed the progression of Alzheimer’s disease in a phase 2 trial. Other trials are examining the extent to which GLP-1s can curb cravings for alcohol, nicotine, opioids, and even psychostimulants—or whether it could help eliminate the need for insulin altogether in some type 1 diabetics.

Beyond the potential benefits to human health, which are promising but still speculative, each of these new applications would pile even more riches into the coffers of the nonprofit Novo Nordisk Foundation, which owns 28 percent of Novo Nordisk’s equity. The organizational structure is unusual for the pharmaceutical industry but not uncommon in Denmark, where companies like Lego and Maersk are also owned by charitable foundations. In the case of Novo Nordisk, its foundation has a very specific mission: to support scientific, humanitarian, and social causes in health and education.

Those values are woven into the company’s day-to-day work through a set of norms known as the Novo Nordisk Way, Mulroney explains. “We talk about the triple bottom line from day one. Responsibility for financial goals, environmental goals, and societal goals are measured and taken seriously—it’s so much a part of the culture as a Danish company,” she says, and a contrast to the cultures she encountered at other pharmaceutical companies. In the 2023 annual report, President and CEO Lars Fruergaard Jørgensen cites its commitment to health equity as a cornerstone of its commitment to patients—and the force behind investments of more than DKK 75 billion to expand production and improve human health across the globe.

Yet, skepticism persists. In September, Vermont Senator Bernie Sanders challenged Jørgensen in a Senate committee hearing on the high cost of drug prices in the United States. Why should a month’s supply of Wegovy cost an American $1,300, when the same product runs $137 in Germany or $92 in the UK?

This tension over pricing and access became a focus of the conversation when Badaracco taught his case in Leadership and Corporate Accountability (LCA). The case asks students to consider how the company is doing in terms of its responsibility to its investors, customers, employees, and society. Students were split on the question: Was the foundation failing to make good on its commitments to global health because most of the product is sold in the US to people who can afford it or have the insurance to cover it? Or should Novo do what it can to enhance its profits now, before the competition arrives, to maximize funds for the next generation of products and its capacity to produce them? It’s a sticky question, considering these products could have untold benefits “that could transform the world,” Badaracco says.

Novo Nordisk acknowledges that, as the business grows, so will its impact on society—thanks in part to the windfall that’s headed to its foundation. Already one of the world’s largest charitable foundations, it has $167 billion in assets under management. (The Gates Foundation has $75 billion, by comparison.) Grants nearly doubled from 2018 to 2022, to $1.1 billion; Novo Holdings, the company’s controlling shareholder, announced plans to invest up to $7 billion annually by 2030, according to the Financial Times. As GLP-1 revenues have soared, the foundation has been able to direct millions toward efforts to improve the treatment of diabetes. It recently committed $4.7 billion to Alzheimer’s research and $200 million for a quantum computer that will focus on drug development and climate research. With investments at this scale, the foundation is positioned to do more than merely contributing to progress; it’s setting the stage for transformative changes that will ripple through the industry—and society—for years to come.

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