Novo to Buy Catalent for $11.5B to Boost Wegovy Supply

Novo Holdings, parent of Novo Nordisk, will buy contract drugmaker Catalent for $11.5 billion in cash to help meet the strong demand for its popular weight-loss drug Wegovy, the companies said Monday.

As part of the deal, Novo Nordisk will buy three Catalent fill-finish sites, as the Danish company struggles to meet the extraordinary demand for newer, powerful weight loss and diabetes drugs such as Wegovy and Ozempic over the past one year.

Catalent, whose shares rose 13% to $61.69 in premarket trading, is the main supplier of fill-finish work, or filling and packaging syringes and injection pens, for Novo Nordisk's Wegovy.

"The acquisition complements the significant investments we are already doing in active pharmaceutical ingredients facilities, and the sites will provide strategic flexibility to our existing supply network," Novo Nordisk CEO Lars Fruergaard Jørgensen said.

Novo expects the deal to gradually help increase its filling capacity from 2026 onwards.

As part of the deal, Novo Nordisk will buy three Catalent sites from its controlling shareholder Novo Holdings for $11 billion. Novo Holdings owns 76.9% of the voting shares in the Wegovy maker.

The deal for the three fill-finish sites will have a low single-digit percentage negative impact on operating profit growth in both 2024 and 2025, Novo Nordisk said.

Novo Nordisk faces competition from Eli Lilly's Zepbound in the fast-growing obesity drug race, but a major hurdle for both the companies is meeting ferocious demand. Analysts have estimated the market could be worth as much as $100 billion by the end of the decade.

Novo Holdings said it will buy all outstanding shares of Catalent for $63.50 per share in cash, a premium of 16.5% to the company's last trading price.

Elliott Investment Management and some of its affiliates have agreed to vote their shares of Catalent common stock in favor of the merger with Novo Holdings.

The Danish holding company will also take on Catalent's debt, taking the total enterprise value of the deal to $16.5 billion.