Just after Lars Fruergaard Jørgensen took over as Novo Nordisk’s chief executive in 2017, he made a decision that would make the Danish drugmaker Europe’s largest company by market capitalization this month.
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 away from the approval of Wegovy, the version that targets obesity. The management team was debating whether to conduct an expensive trial to determine whether Wegovy would cut the risk of heart attacks and strokes.
Mads Krogsgaard Thomsen, chief executive of the Novo Nordisk Foundation, described the executives asking: “Why would we conduct such a trial with a high risk of potentially 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?”
Ultimately, the decision was up to Jørgensen. “His head was on the line. It’s 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% lower chance of suffering a cardiovascular event such as a heart attack or stroke compared to those who received a placebo.
Investors are hopeful that the data will convince health systems and insurers that the medicine, which has gained attention as a slimming tool for wealthy individuals, could actually save lives and costs. Shares soared 16% that day, and continued to rise until Novo Nordisk surpassed French luxury conglomerate LVMH as the largest European company on Monday.
Jørgensen has a significant commercial opportunity: Novo Nordisk and Eli Lilly are the two main companies in a market that Canadian investment bank BMO estimates could be worth up to $130bn to $140bn annually at its peak.
However, Jørgensen also faces significant challenges: the company is still working to scale up the supply of the drug, some health insurers are hesitant to cover the costs, and Ozempic and Wegovy are being used as slimming injections by individuals who are not obese.
Jørgensen learned about taking 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 understood that things do not come without an investment or effort, and based on those efforts, you reap your rewards,” 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 various roles 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, at just 33 years old. “He is the type of person who easily takes on responsibility and follows through on it, whether it’s feeding 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. In addition to responsibility, he emphasizes the importance of reflection in life and enjoys kayaking on the lake near his house.
Novo Nordisk, which turned 100 this year, is far from a household name, and Jørgensen does not aim 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, noted that he does not dominate earnings calls like other well-known pharmaceutical leaders. “He has not made himself the face of the company, and people really appreciate that. It’s about Novo Nordisk, not about him,” she said.
But one person familiar with the matter said that while he liked the idea of a flat organization, he held veto power over everything. “At first, you might think he lacks gravitas, but after spending half an hour in a room with him, you see that he is very calm and poised, never gets angry. He can control the room by simply lifting his head quickly,” the person said.
Long before its obesity drugs made headlines, Novo Nordisk faced political pressure in the US due to rising insulin prices. Recently, the company was suspended from the UK industry association for mismarketing a previous obesity drug. Jørgensen apologized and referred to the failure to disclose sponsorship of a training course as a “mistake.”
Now Jørgensen faces scrutiny in Denmark, where Novo Nordisk is the largest taxpayer, and he is also the president of the industry’s European lobby group, battling the biggest EU reform in pharma legislation in 20 years.
Jørgensen recently had lunch with one of his critics in the Danish parliament, Lisbeth Bech-Nielsen of the Socialist People’s party. She argued that now that the company has a market cap and earnings that are “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 that Novo Nordisk is a symbol of European innovation. She said that Jørgensen is the right person to lead the industry group because he knows how to make Europe better for a company “that is growing, 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
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