Danish pharmaceutical company novo nordisk (NYSE:NVO) has taken the world by storm thanks to its popular diabetes and obesity drugs Ozempic, Rybelsus, and Wegovy.

2023 was a milestone year for Novo Nordisk, with Ozempic and Wigovy playing leading roles in the company’s growth. Just last week, Novo Nordisk received positive news from the Food and Drug Administration (FDA), sending its stock price soaring to new highs.

Let’s analyze what’s happening at Novo Nordisk and assess why the company’s best days are yet to come.

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Most of the buzz surrounding Novo Nordisk stems from the company’s blockbuster drug Ozempic. Although weight loss may be a byproduct of taking Ozempic, the treatment itself is not FDA-approved for weight loss. Instead, the FDA granted Wegovy approval for chronic weight management. Interestingly, Ozempic and Wegovy both use the same compound, semaglutide.

In 2023, Wegovy’s sales jumped 393% in the US alone. Wegovy sales may have just begun. Last week, the FDA approved a new indication for Wegovy. This weight loss drug is now also available for patients with cardiovascular disease. The expanded indication expands Novo Nordisk’s addressable patient base to include patients at risk of stroke and heart attack.

What does this mean for Novo Nordisk?

The expanded adaptation of Wegovy opens many doors for Novo Nordisk. But I think the cardiovascular disease approval is particularly important.

According to Precedence Research, the addressable market for cardiovascular drugs is expected to exceed $200 billion by 2032. The sheer size of this market is not particularly surprising, considering that data from the Centers for Disease Control and Prevention (CDC) suggests that heart disease is the leading cause. Additionally, the World Health Organization (WHO) estimates that ischemic heart disease and stroke are the top two causes of death worldwide in 2019.

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It is important to note that analysis of data collected by agencies such as the CDC and WHO takes years. So while some of these health trends may change, the broader theme is that Novo Nordisk is currently operating within a huge market with unprecedented challenges. is.

Is now a good time to buy Novo Nordisk stock?

Novo Nordisk stock currently has momentum driving its share price higher. Shares are up 30% this year already, and the stock is hovering near all-time highs. Part of this movement is being driven by the company’s strong Q4 earnings report and the latest news from the FDA, but I think there’s a bigger factor here.Both S&P500 and Nasdaq Composite Investor enthusiasm remains largely confident, with stocks trading at record levels. While the overall market is up, Novo Nordisk stock is likely experiencing a bit more of a broader “crash.”

Nevertheless, it is important for long-term investors to remember that spending time in the market is more important than market timing. For now, the company’s core businesses are obesity and diabetes, with the latter expected to grow rapidly over the next 20 years.

In addition to Ozempic and Wegoby, Novo Nordisk also appears to be stepping up its ambitions thanks to its latest development, a pill version of its weight loss drug, Amicletin. As such, Novo Nordisk appears to be well-positioned to continue to dominate the two growth markets.

Now, with the expansion of Wegoby’s indications, Novo Nordisk has the opportunity to disrupt an even larger part of the healthcare space. Despite the premium valuation, we think now is as good a time as ever to buy up Novo Nordisk stock and plan to hold it for the long term. A wise strategy is to use dollar-cost averaging and gradually add to positions as the company’s long-term execution progresses.

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Adam Spatacco has a position at Novo Nordisk. The Motley Fool recommends Novo Nordisk. The Motley Fool has a disclosure policy.

A big win for Novo Nordisk. “And It Has Nothing to do with Ozempic” was originally published by The Motley Fool