Novo Nordisk A/S is spending 15.9 billion Danish kroner ($2.29 billion) to expand production facilities in Denmark as the obesity drug manufacturer looks to ensure capacity for its future portfolio.

The investment in Hillerød, Denmark is planned to create additional production for its pipeline drugs to fight serious chronic diseases, Novo said in a statement Monday. The expansion is unrelated to semaglutide, the active ingredient in its obesity and diabetes medicines Wegovy and Ozempic, Novo said.

Novo’s market valuation has rocketed up — now second in Europe only to luxury giant LVMH —on the promise of therapies that induce weight loss, creating clamor around the world, along with struggles to keep up with demand. Drugs under development in the company’s portfolio include medicines aimed at treating heart and sickle-cell disease.

Construction to expand the existing active pharmaceutical ingredient production facility has started and is expected to be online by early 2029, Novo said. The expansion will cover about 65,000 square meters and has been designed flexibly to accommodate a wide range of technologies for different medicines.

Production Issues

The new capacity may help Novo ward off the kind of troubles it’s encountered in getting supplies of its weight-loss medicine to the public. The drugmaker said last month it was temporarily reducing the availability of some dosages in the US by 50% as it worked to expand manufacturing.

The global obesity market is predicted to explode as countries grapple with the disease and its related health conditions. Sales of obesity medicines are estimated to reach $44 billion by 2030, according to Bloomberg Intelligence.

The manufacturing “investment will ensure the continuous development of our late-phase pipeline,” Henrik Wulff, executive vice president of product supply, quality and IT, said in the statement. It also “confirms Hillerød and Denmark as cornerstones in our global footprint.”

The expansion is expected to create 340 new jobs on completion.