Novo Holdings Reports Record Annual Performance Amid Global Economic Uncertainty

Novo Holdings, the controlling shareholder of Novo Nordisk, reported a remarkable annual performance despite facing a challenging global economic landscape. The investment company, which manages the assets of the Novo Nordisk Foundation, generated a total income and investment returns of €8 billion for 2024, significantly up from €4.2 billion the previous year.

Of this impressive return, just over €3 billion was derived from dividends and share repurchase programmes at Novo Nordisk, alongside Novonesis, a maker of industrial enzymes. The remaining €4.9 billion came from gains in its investment portfolio. Life sciences investments contributed notably to this success, achieving a record return of 18 per cent, compared to 9.4 per cent in 2023.

Despite these gains, Novo Holdings faced challenges as total assets under management declined from €149 billion in 2023 to €142 billion in 2024, primarily due to a fall in the market value of Novo Nordisk. The company’s shares had previously soared following the breakthrough of Wegovy in the weight-loss market, but increased competition from companies like Eli Lilly has since pressured shares.

Kasim Kutay, the CEO of Novo Holdings, expressed optimism about the previous year’s returns, which he described as both record-breaking in absolute terms and significantly outperforming benchmarks. However, he acknowledged that the beginning of 2025 has presented a more challenging environment, characterised by widespread economic uncertainties and geopolitical risks.

Concerns regarding future investment strategies loom as Novo Holdings plans to decrease investments in response to current market conditions. Kutay observed that differences in Federal Reserve interest rate predictions are creating a risk-off sentiment among investors.

Despite these headwinds, Novo Holdings has outlined intentions to increase its annual investment budget from $3 billion to $5 billion over the coming years, with a target of reaching $7 billion by 2030. This move reflects a long-term strategy of capitalising on downturns to identify investment opportunities.

Kutay highlighted a significant equity investment in Oxford Nanopore, underscoring the importance of prudent timing in investments. He expressed concerns about the overall sentiment in the UK’s life sciences sector, emphasising the need for government support to unlock the industry’s full potential.

As the government develops a sector plan as part of its industrial strategy, Kutay remains hopeful that it will address the critical issues facing the life sciences industry, which is pivotal to the economic health of the UK.