By Dhirendra Tripathi
Investing.com – Novo Nordisk stock (NYSE:NVO) slumped 5% in Monday’s premarket trade after the company warned of a hit to the availability of a key obesity drug in the U.S. due to issues at a supplier.
The company said a contract manufacturer filling syringes for its Wegovy pens for the U.S. market has temporarily stopped manufacturing and deliveries, following issues with Good Manufacturing Practices.
Wego was turning out to be a winner for the company at a time when its core insulin business is under pricing pressure. The development is a setback to Novo Nordisk when it was hoping to establish the drug in the obesity segment ahead of a 2024 launch of a rival drug by Eli Lilly (NYSE:LLY).
Last month, the company said it expects sales growth to slow by about 3% in 2022 because of lower prices and a drop in insulin sales volumes in China. It doesn’t expect supply challenges to affect the previously communicated outlook for 2021.
The Danish company said that it does not expect to be able to meet demand in the U.S. in the first half of 2022 and that few new patients will be able to initiate treatment. It expects to be able to meet demand in the U.S. in the second half of 2022.
Novo Nordisk declined to name the manufacturer but said the issues concerned a European site of a large international company. According to Reuters, the two parties are in dialogue and the company believes the contractor has a "good plan in place".
The company will declare its full-year earnings on February 2.