Novo-Nordisk gives me a boost with a double dose of power.

Most people prefer to take a pill rather than inject themselves with medication when they are sick. This simple fact helped Novo-Nordisk, (stock ticker:NOVO), to become the third-most valuable holding in my “forever fund” after renewed hope from the pharmaceutical company that its wonder drugs Ozempic or Wegovy could be delivered without a need for a stab.

The share price soared because Mr Market, who is known for discounting the future or anticipating events before they happen, was able to do so. Ozempic, and Wegovy, were also boosted by the hope that China, which is the second-most populous country in terms of population, would soon approve them. Both were synthetic hormones originally designed for diabetics, but gained popularity as weight loss drugs.

The American Food and Drug Administration has approved Wegovy to reduce the risk of stroke and a heart attack among overweight or obese adults without diabetes. These medications reduce the desire to consume food, which can help humans cope with a flaw in their psychology. For millennia, evolution has equipped us better to deal with periodic scarcity than constant abundance.

This is what made this fat person invest over three years ago when I heard the rumors of a weight-loss medication that worked after decades of failures. It’s a good thing that your humble correspondent bought Novo shares when few Brits knew about the Danish drug maker.

In February 2021 I reported that, after paying $73 in American Depositary Receipts (ADRs), which were divided in half last September, the effective price for this stock was $36.50. The stock cost $132 on Friday. In June 2021, after discovering that ADRs didn’t help me avoid Danish withholding taxes, I bought the shares at 509 Danish Krone (effectively DK254 following the subsequent split). Stocks now cost DK908.

Ozempic, Wegovy and other weight loss medications are now more affordable for those who want to lose weight. There is also the potential to treat a wider range of diseases.

Cowie purchased Novo-Nordisk for $36.50 per share in February 2021. This week, the price is $133.

Novo, owned by a charity foundation, says that its large-scale clinical trials have shown that their drugs reduce the risk for nonfatal heart attacks, nonfatal stokes, and heart-related death by 15% compared to a placebo in patients with heart conditions.

This has, of course, attracted the usual cynicism on antisocial media and dire predictions. It’s hard to see how this will help the estimated 41 million Americans who suffer from diabetes and other obesity-related problems.

No one, not even the critics, followed Novo last year in investing 45billion (£5.2billion) into research and development for those patients. According to Refinitiv, the independent statisticians, this is financed by a gross profit margin (85%) and net profit margin (36%), which are both eye-stretching, if not waist-shrinking.

It is unlikely that any business, whether owned by a charity or not, will be able to match these returns. It is a highly competitive global market, and Big Pharma rivals are racing to catch up. Eli Lilly, the American company that has the largest medical business in the entire world, is also not far behind. It also has a weight-loss medication that is marketed under the names Mounjaro or Zepbound. A treatment for Alzheimer’s, which awaits approval, is also available.

It is acceptable to support more than one pharmaceutical company, as two opinions make a market. In July of last year I invested another 2% of my savings into LLY, at $441. This was reported on here at the time. On Friday, the shares were trading at $752, and they are now my sixth-most valuable holding. Both companies are finding innovative ways to meet real needs.

It’s no wonder that Novo, Europe’s largest company with a market capitalisation of £472billion is the most valuable in Europe. It is unfair to compare apples and pears but that pile of shares has a value greater than the gross national product of Denmark.

Morgan Stanley Capital International (MSCI) says that Novo is the 12th largest business in the entire world. It may soon be the only non American firm to make the top 10 of the MSCI All Countries World Index. This small shareholder is thrilled to welcome our tracker fund friends aboard. It’s better late than never.

In addition, and in a more serious way, investing in health care offers us all a chance make our money count and to do good while doing well.

The income that we do not have to share with HM Revenue & Customs will be a tenth less than it was a few short years ago. In a move that has been largely overlooked, Jeremy Hunt’s chancellor will reduce the annual dividend tax exemption, a portion of tax-free investment income, to £500 as of April 6. In 2017-18, it was £5,000. Tory tax increases!

This makes the annual Isa allowance – the £20,000 we can put out of reach of the taxman – even more valuable. The British Isa, which was so highly praised, is now looking like a bad idea. Treasury has indicated that it will not be implemented before the next elections. However, the ordinary Isas exist. The Isas allow every adult to benefit from tax-free income and capital growth on their savings and investments without the age-related restrictions which make pensions less flexible.

Isas do not offer any tax benefits at the beginning, but pension contributions are eligible for initial or upfront relief. These two shelters are essentially mirror images. It doesn’t need to be either/or. Those who can afford both should seriously consider it.

Remember that the tax-year ends on April 5 at midnight. Anyone who hasn’t used their allowance for 2023-24 must get moving. Investors in Isas cannot make up lost time, unlike pensioners. Name is the clue. Use it or lose your annual allowance.