Diabetes and obesity treatment are currently two driving forces for the pharmaceutical industry. novo nordisk (NYSE:NVO) is at the forefront of these markets thanks to its much-hyped blockbuster drugs Ozempic, Rybelsus, and Wegovy.

2024 will be a milestone year for Novo Nordisk, and it looks like it’s not slowing down. Let’s dig into the company’s recent wins to assess whether now is a good time to buy stock.

Novo Nordisk’s big breakthrough

Pharmaceutical companies often seek alternative uses for their most successful drugs. These are known as extended indications. They go through a separate and robust clinical trial process with the Food and Drug Administration (FDA).

In early March, Novo Nordisk received an expansion grant for its obesity treatment Wegoby. Specifically, Wegovy is currently approved to treat patients at risk for heart disease. Expanding into the cardiovascular market makes sense given that cardiac complications such as stroke and hypertension are often highly correlated with obesity and diabetes.

This gives Novo Nordisk an advantage over its competitors. Eli Lilly –Danish pharmaceutical companies don’t seem to be slowing down at all.

Novo Nordisk is firing on all cylinders

Successful development of new drugs offers several lucrative benefits to pharmaceutical companies. Increased sales and profits are obvious by-products. But how companies reinvest these profits could create further catalysts.

Acquired by Novo Nordisk in February Catalent 16.5 billion dollars. The rationale behind the deal was interesting. Novo Nordisk’s management has consistently advised investors to taper expectations related to revenue and profit growth as it faces several challenges meeting demand for Ozempic and Wigoby during 2023. I told him.

Catalent is a pharmaceutical subcontractor. Therefore, this agreement provides Novo Nordisk with an additional factory that it can leverage to increase manufacturing output and meet demand levels.

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While this deal is very smart, Novo Nordisk is not done yet. The company announced in late March that it would acquire Cardiol Pharmaceuticals. Cardior is currently conducting a Phase 2 trial of its compound CDR132L and hopes to gain approval as a heart failure treatment.

Is now a good time to invest in Novo Nordisk?

With so much positive news coming out of Novo Nordisk, investors shouldn’t be surprised to see the stock trading near all-time highs. But despite the company’s recent valuation jump, I still think Novo Nordisk is an attractive buy. First of all, Wegovy’s potential for the company is just beginning.

While competition in obesity treatment is noteworthy, Wegovy is now a multi-platform drug and its growth prospects should not be discounted. The expanded approval of Wegobee and the acquisition of Cardiol demonstrate Novo His Nordisk’s commitment to aggressively pursue the $200 billion heart disease market.

Second, in the midst of Novo Nordisk’s acquisition spree, it may have been overlooked that Novo Nordisk had successfully completed a Phase 1 clinical trial for its oral obesity drug candidate, amicletin. Although it will likely be many years before amicretin is commercialized, I am optimistic that Novo Nordisk is already laying the foundations for a growing presence in obesity care.

Finally, the company’s crown jewels are the diabetes drugs Ozempic and Libersus, which together account for nearly 60% of the glucagon-like peptide-1 (GLP-1) market. According to research, by 2045, there will be approximately 1 billion adults with diabetes worldwide. I see this as a huge tailwind for Nordisk over the next few decades, and I’m not worried that demand for Ozempic or its siblings will wane anytime soon.

We think now is as good a time as ever to buy Novo Nordisk stock, given the abundance of growth opportunities in diabetes and obesity treatments, as well as its entry into the cardiovascular market. A smart strategy is to use dollar-cost averaging and add to positions over time.

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Adam Spatacco holds positions at Eli Lilly and Novo Nordisk. The Motley Fool recommends Novo Nordisk. The Motley Fool has a disclosure policy.

Novo Nordisk continues to move after approval of Wegoby heart disease drug Original article published by The Motley Fool