Just after Lars Fruergaard Jørgensen took over as Novo Nordisk’s chief executive in 2017, he took a decision that would this month make the Danish drugmaker Europe’s largest company by market capitalisation.
The pharmaceutical company had not yet launched Ozempic, the diabetes drug that would later become famous as celebrities took it off-label for weight loss, and was years from the approval of Wegovy, the version that targets obesity. The management team were debating whether to embark on an expensive trial that would prove whether or not Wegovy would cut the risk of heart attacks and strokes.
Mads Krogsgaard Thomsen, chief executive of the Novo Nordisk Foundation, which has the majority of voting rights in the company, described executives asking: “Why would we do such a trial with a high risk of maybe not showing anything? Maybe it’s just the anti-diabetic effect that is responsible for the benefits we’ve seen in diabetes. What if we don’t see anything in obesity, and the trial costs hundreds of millions of dollars?”
But at the end of the day, it was up to Jørgensen. “His head was on the block. It is a lot of money,” he said.
His gamble paid off: the initial trial data published last month showed that patients who took the Wegovy drug had a 20 per cent lower chance of suffering a cardiovascular event such as a heart attack or stroke than those who received a placebo.
Investors hope the data will prove to health systems and insurers that the medicine, which has made headlines as a rich person’s slimming tool, could actually save lives and costs. Shares soared 16 per cent that day, and continued rising until Novo Nordisk overtook French luxury conglomerate LVMH as the largest European company on Monday.
Jørgensen has a huge commercial opportunity: Novo Nordisk is one of two main companies, along with Eli Lilly, in a market that the Canadian investment bank BMO estimates could be worth up to $130bn to $140bn a year at its peak.
But he also faces giant challenges: the company is still trying to scale up supply of the drug, some health insurers are reluctant to foot the bill, and Ozempic and Wegovy are being used as slimming jabs by people who are far from obese.
Jørgensen learnt to take responsibility at a young age, on the family farm in Jutland, Denmark.
Lars Green, chief financial officer of sister company Novozymes, has known Jørgensen since university.
“His upbringing means he has always learned that things do not come by themselves. They require an investment, or an effort, and based on those efforts you harvest your returns,” he said.
After studying finance and business, Jørgensen joined Novo Nordisk on the graduate scheme in 1991 and has worked with the company in the US, Japan and the Netherlands, in functions from technology to business development.
Jesper Brandgaard, former chief financial officer at Novo Nordisk, described Jørgensen when he became interim head of corporate finance at the company, aged just 33. “He is the type of person that very easily will be assigned responsibility, and then takes care of the responsibility, whether it’s needing to feed the pigs or whatever he needs to do,” he said.
Jørgensen, 56, met his wife at Novo Nordisk and they now have two adult children. As well as responsibility, he stresses the importance of reflection in life, going kayaking on the lake near his house.
Novo Nordisk — with the rest of Denmark’s pharma industry — has grown so big that without it the Scandinavian country’s economy would be in a recession. With it Denmark’s gross domestic product grew 1.7 per cent in the first half of this year. Stripped out, it contracted 0.3 per cent.
But the company, which turned 100 this year, is far from a household name, and Jørgensen does not want to become a “brand”, like some other chief executives of Big Pharma. Often described by his friends as a humble introvert who listens intently, he is eager to share the stage with his team.
Emily Field, an analyst at Barclays, said he did not dominate his earnings calls like some better known pharmaceutical leaders. “He has not made himself the face of the company and people really like that. It is about Novo Nordisk, not about him,” she said.
But one person familiar with the matter said while he liked the idea that the organisation was flat, he held the veto on everything. “At first you think he doesn’t have a lot of gravitas, but after half an hour in a room with him you see he is very calm, very poised, never gets angry. He can control the room by very quickly lifting his head,” he said.
Long before its obesity drugs hit the headlines, Novo Nordisk was under political pressure in the US for rising insulin prices. Recently, the company was suspended from the UK industry association for mismarketing a previous obesity drug. Jørgensen apologised and said the failure to disclose sponsorship of a training course was a “mistake”.
Now Jørgensen faces scrutiny at home in Denmark, where Novo Nordisk is the largest taxpayer, and he is president of the industry’s European lobby group, battling the biggest EU reform in pharma legislation for 20 years.
Jørgensen recently met one of his critics in the Danish parliament, Socialist People’s party member Lisbeth Bech-Nielsen, for lunch. She argued that now the company had a market cap and earnings that were “out of this world”, it should consider lowering prices. “Obviously, we didn’t agree, but I had a good impression of him,” she said.
Nathalie Moll, director-general of the European Federation of Pharmaceutical Industries and Associations, believes Novo Nordisk is a poster child for European innovation. She said Jørgensen was the right person to lead the industry group because he knew how to make Europe better for a company “that grows, not a company that has already grown, or a tiny company, but one that has really evolved over the last 30 years”.
Additional reporting by Euan Healy and Richard Milne