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In a press conference, economy minister Jakob Ellemann-Jensen acknowledged that highlighting one company so many times was “a bit bizarre” and “certainly not something that happens normally”.
“Things wouldn’t be looking quite as good [for the economy] if you removed Novo Nordisk from the equation. But luckily, it is part of the equation,” he said at a press conference.
One of the country’s largest financial papers recently ran an article asking whether the Danish economy was about to become a subsidiary of Novo Nordisk.
Dependence on one company can be a risk in a global economy where businesses are mobile. Ellemann-Jensen has acknowledged that Denmark “must make sure Novo Nordisk keep being [here] so we don’t lose the income, the number of jobs and the pride we all feel.”
Birthe Larsen, of the Copenhagen Business School, says there is “always a risk” when a country becomes “too dependent on one company”.
Nearby Nordic neighbour Nokia provides a cautionary tale. The mobile phone pioneer was at one point responsible for a fifth of Finnish exports.
However, sales quickly plummeted after Apple triggered the smartphone revolution with the launch of the iPhone in 2007.
Nokia never fully recovered and its woes have been blamed for triggering a decade of stagnation for the Finnish economy.
Olsen says: “If you gain a lot, you can also lose a lot. Clearly, someday it might go the other way for Novo Nordisk.”
The main risks would be if rival pharmaceutical companies develop a drug to eclipse Wegovy, or if Novo Nordisk were to decide to relocate for some reason. Most pharmaceutical majors are now racing to develop their own weight loss jab.
If boom does turn to bust “then you would have all the effects in reverse”, says Olsen. “Shareholders getting less money, the government getting less taxes, some good jobs disappearing, and GDP declining.”
Olsen believes Novo Nordisk’s deep roots in the country and Denmark’s highly skilled workforce will keep the company headquartered there.
“Of course, if we were to rest on our laurels and become very complacent and say, ‘Oh, we really don’t have to make an effort’, then we are creating [this risk] for the future,” Olsen says.
“But that’s not the situation right now.”
More broadly, he believes the Danish economy is resilient enough to withstand any unexpected shocks. The country has in the past adapted to the decline of once-major industries such as textiles, agriculture and shipbuilding.
“We are used to big shifts.”
For now, the Danes are enjoying the windfall from their miracle drug. And why not have a party while it lasts.
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