Latest / The Curve / TCW34: The Danish pharma-giant taking the world by storm, and how literal storms are adding to inflation.

Transcript

TCW34: The Danish pharma-giant taking the world by storm, and how literal storms are adding to inflation. · The Curve

• 0:00
  Hi and welcome to the Curve Weekly, the podcast that keeps you up to date with all the money,
• 0:06
  business and stock market tea. Everyone should experience for us at least once in their lives
• 0:10
  and Annie shouldn't miss out just because she can't afford it. Help me, I'm poor.
• 0:16
  You know how last week I had a bit of a wha about the whole my scenario, breaking my phone,
• 0:22
  losing my AirPods, you know when it just rains at pause and it's just all the shit things
• 0:27
  tend to happen at one go. I decided, I mean I came out to stay with my family in the country
• 0:32
  firstly, which thank God is such a life saver, just being around family and people who you can like
• 0:38
  have a home cooked meal with and anyway, so good for the soul. But do you know what I also decided?
• 0:43
  You're probably not going to be that proud of me. I went into my investments and took out some more
• 0:50
  money. I've pulled out like five grand. So if this is not sustainable, what if that's your last
• 0:56
  five grand? Imagine that's your last five thousand dollars. What would you do?
• 0:59
  Cry. Exactly. I'm going to be a harsh critic here and I know you know it's bad. And it's like,
• 1:07
  it's like when your parents say, well, why did you do that? And you're like, I've pissed off,
• 1:10
  I've done it now, but you just need to real like, if that's your last five thousand dollars,
• 1:15
  you know, like that's how you need it. It's not my last five thousand. No, no, I know, but that's
• 1:19
  how you need to approach it because it will be at some stage of it. If you keep going, do you know what I mean?
• 1:24
  So it's like not to be brutal. But that's how you should be thinking. Is this? Yeah.
• 1:31
  Can you just hear me out? So what I thought was, I thought, I'm feeling really sad at the moment.
• 1:39
  I've lost my ear pods. I need to replace them. There's so many things that I need to actually
• 1:45
  do to feel like a functioning human right now. Even just small things like I use my ear pods to
• 1:50
  meditate. I use every time I look at my phone screen because it's so cracked. I just feel like a
• 1:56
  shit human. But all of these things that have been stressed me out, that's one side of it.
• 2:02
  But the other is I haven't had a summer, you know, like I haven't had any kind of holiday at all.
• 2:09
  Except for actually that's not true. We went to Italy today. Other than that, I haven't, I haven't
• 2:14
  had all of it. And I thought, do you know what? For the mental health, I'm just going to pull a
• 2:18
  bit of money out of my investments. I'm going to book a flight to France and go and see one of my
• 2:22
  best friends. And I'm not going to sit there stressing like I didn't actually about how much money I
• 2:27
  have or how much things cost. I'm going to let myself have one blow out. You know, like for four days,
• 2:34
  just a little holiday, a little, it's okay. Everything's going to be fine. And then when I come back,
• 2:40
  I'm going to start being more strict on myself. Nice. Okay. I like that. Sorry. I feel terrible.
• 2:45
  So do you still not think, do you think that's fine? Or do you still think that's good?
• 2:49
  Yeah. I feel terrible for giving you a little brutal pep talk just before.
• 2:52
  No, it's good because I don't want to keep doing this. And I have taken out so much money from
• 2:58
  my investments. So like it is definitely something that I need to be not doing on the long term.
• 3:03
  But I kind of was just like, you know what? I'm going to give myself a break and not stress and
• 3:08
  just spend this money without any guilt. And then when I come back, head down bummer.
• 3:13
  Yeah. Love that. Love that. Enjoy fast. Thank you. I will. I'm going to eat croissants.
• 3:19
  Yeah. I'm going to drink coffee. And I'm going to wander around and just
• 3:24
  hopefully, I honestly, I just want to be horizontal with a book in some kind of sunshine,
• 3:31
  even if it's just for 30 minutes. Yeah. Nice. Because we've had a pretty,
• 3:34
  I'm just desperate for like a relax London summit, you know? I know. Everyone's like,
• 3:39
  it's never like this. I traveled halfway around the world for this. Yeah. I know. It's like,
• 3:44
  God, it was never like that in New Zealand last summer either. We're talking about just
• 3:47
  following the bad summer. Yeah. We're following the rain. Anyway, it's sorry. First world
• 3:52
  problem. You know, it's kind of, yeah, completely. But we're very thankful to be here. It's great to
• 3:57
  be here. So the S&P 500, which is the top 500 companies in the US public list of companies. Yes.
• 4:08
  Well done. That's been a pretty miserable August for the S&P 500. So when we talk about the US
• 4:14
  stock market, that's what we're referring to is the S&P 500. Oh, sorry. It's going to be
• 4:19
  email. It's going to be a volume of home. Sorry. Just all my hinge notifications, my jokes.
• 4:24
  That joke's old now, but I love that you keep using the same jokes as if people aren't listening
• 4:30
  and already hearing them. I'm like, I know. You said that last week, right? I know. It's just
• 4:35
  funny, but it's, yeah, no, it's not anyone. Sorry. It's not though. For the fourth time, it's not
• 4:40
  funny. I know. Okay. Get somebody back. It's hard getting you content twice a week, you know?
• 4:47
  It can't be that funny all the time. Well, the S&P 500 had a pretty shocking August. It's
• 4:53
  down 2% for the month, but remember, it's still up 18% for this year, which is pretty incredible.
• 5:03
  Like 18% return in eight months is, you know, like, I'll take that. Thank you very much. But
• 5:11
  isn't that S&P 500, if you're saying it's up 18%, does that mean if you put $100 in, you would
• 5:20
  have $120 now. If you'd invested in the S&P 500 as a whole, yes. That's great. $180. Just be
• 5:28
  patented. Oh yes. Yeah. You caught your annoying. I know. Anyway, this probably doesn't give you much
• 5:36
  comfort, you know, the fact that the market's down for the month because as we head into September,
• 5:43
  September has historically been one of the worst month for stocks with the S&P 500 falling
• 5:50
  on average over 1%. In the month, dating back to the 1920s. So historically, September has
• 5:59
  been a really, really bad month. So if had a bad August, historically, if had a bad September,
• 6:04
  so if history repeats, we'll probably have a bad September. But yeah, remember, it's long term
• 6:10
  game, you know, the stock market is still up 18%. So don't get too concerned with that. We don't care
• 6:17
  about one percent down. So we have some company news in Europe, actually. So we always talk about
• 6:28
  LVMate, which is Louis Vuitton, more at Hennessy, about being the most valuable company in Europe,
• 6:33
  which means it has the largest market cap. So that just means the size of the company. So it's
• 6:42
  the largest company in terms of its size. And it's market cap is, it's share price multiplied by
• 6:50
  the number of shares that are available to investors. So when the share price goes up, the market cap
• 6:56
  will the overall value of a company goes up. So currently, LVMate is the largest company in Europe,
• 7:04
  the largest public company. But it has another company that is very hot on its tails. And I
• 7:11
  keep checking to see if it's surpassed it. Can I guess it? Can you give me some clothes?
• 7:16
  Sorry, I should have wanted to give me some clothes. You should, it's a healthcare company.
• 7:20
  I thought, how rude are you? I know, sorry. Sorry, that was really unencourageary.
• 7:25
  I can't get you, Gallabray. I know. Go for it, girl. You got this.
• 7:29
  Okay. Can I have a clothes? It begins with in.
• 7:34
  NVIDIA. Wow. Good.
• 7:35
  NVIDIA, but no. Oh, okay. It's a US company, but okay. Okay. Wait, wait, wait,
• 7:39
  we're a good guest. Oh, a future Gina. No, honestly, I don't think you would have heard of it.
• 7:45
  Sorry. Sorry to break your heart.
• 7:49
  I got it. Okay. It's called Nova Nordisk.
• 7:52
  No, there's NVIDIA there.
• 7:55
  No, there was NVIDIA there. We're going to be here for a whole 12 episode,
• 7:59
  where you guest every in-listed company in Europe.
• 8:04
  Anyway, so new to Gina. I loved the enthusiasm and I loved the trying,
• 8:09
  but Nova Nordisk is a Danish pharmaceutical company.
• 8:14
  And why is it doing so well and it's done so well literally recently, literally just
• 8:19
  this year or the last 12 months and it's all around, it launched two weight loss drugs.
• 8:25
  I feel like we have a population that is increasingly becoming obese and so these weight loss
• 8:35
  drugs, they're primarily being targeted for type 2 diabetes to reduce, I think it's to reduce
• 8:42
  appetite and therefore you don't eat as much and therefore it helps tackle type 2 diabetes.
• 8:48
  So the two drugs are ozempic and we'll go be gosh, I'm going to bridge those. Anyway,
• 8:54
  they have been so hold on. Is it kind of like a tummy tuck or were they doing like a stomach
• 8:59
  stapling operation, except it's a pill? Yes. So that you actually just your stomach is like,
• 9:04
  oh no, I can't have any more food and you feel kind of sick and yeah, I think you feel you feel
• 9:09
  full, fuller earlier because it kind of suppresses your appetite, meaning don't eat as much,
• 9:14
  meaning therefore you don't. So it reduces your weight loss. Sorry, it reduces your weight.
• 9:18
  It's just so bad for your body. Yeah. So but the thing is your weight is contributing to other
• 9:23
  health factors, then maybe it is a good thing. So anyway, this is what they're saying. So they've
• 9:28
  released these two drugs and they've gone absolutely bananas like they've out of supply and they
• 9:34
  can't make enough. But the thing is that people without type 2 diabetes are now using the drug.
• 9:41
  So just every day people that don't actually need it from a pharmaceutical point of course they are
• 9:47
  though. Yeah. I mean, it's kind of like that makes there's no less than a prize to me. It's like if
• 9:52
  you could take a pill and have less wrinkles, I'd be like, hell yeah. But would you at what?
• 9:57
  At what price? Like what if it was really bad? I know, but the thing is yeah, I take that back,
• 10:03
  but I'm just being facetious, but yeah, I know. So anyways, when a lot of people in the world,
• 10:10
  I guess are trying to lose weight, lose weight. And no, but the thing is there's no generally in life,
• 10:18
  there's not quick fixes, right? And this is, this is kind of like, you know, because it's hard
• 10:23
  to exercise. Like sometimes you just don't want to. Sometimes you get bothered. Sometimes you just
• 10:28
  want to eat shit food. So this is kind of like helping all those people who can't be bothered doing
• 10:33
  the hard yards or maybe can't do the hard yards for whatever reason. Exactly. Same with investing.
• 10:38
  You've got to be patient. You've got to, you know, you've got to put in the effort and, you know,
• 10:44
  contribute regularly and do that consistent and regular investing to see the gains. And I think,
• 10:50
  yeah, we are in a world where we just want instant quick fixes all the time. Yeah. But the good thing
• 10:56
  about this is the flow and effect. So, you know, like the healthcare industry, the number of
• 11:01
  healthcare costs a country has that associated to obesity and, you know, increase weight. So if
• 11:09
  this company can reduce that, that alleviates a lot of pressure on healthcare systems globally,
• 11:16
  because they don't have to deal with, with those issues, I guess. So there is positives in this,
• 11:21
  but I think what is fascinating is how quickly, you know, that this share price has moved and how
• 11:28
  big the demand has become for these products. And this has been a hundred year company and they do
• 11:35
  focus on diabetes and, you know, that's kind of their specialty. So, yeah, the fact that they've
• 11:40
  released this drug, you've got other pharmaceutical companies that are scrambling over themselves to
• 11:44
  also release similar drugs. So it's just quite interesting to see. Because they patient to see a
• 11:48
  player like has the drug been paid to get it or whatever it's called. Yes. Yeah. Yeah. No, it has. But
• 11:54
  I guess you can always make us buy the drugs and figure out and then change a little molecule and
• 11:59
  make it release it if you're a competitor. The thing is it's got so many other drugs. But I
• 12:06
  guess what I'm saying is that, you know, it's now a four hundred billion dollar company. Whoa. And
• 12:12
  this is greater than the whole size of Denmark. So Nerva Nordisk is a four hundred billion dollar
• 12:21
  company now. And it is now worth more than the entire size of Denmark. So it's greater than the
• 12:29
  entire country that it's headquartered in. So it's worth more than it's the country it came from.
• 12:34
  Yes. Yeah. And it's all because of these two drugs. The weight loss drugs that have just come
• 12:38
  out. Well, the majority of it. Yeah. I guess the recent increase in its share price. So the majority
• 12:43
  of it. Yes. Like the last 12 months has seen this like shoot up in its share price. And yes,
• 12:49
  it's hot on the tails of LVMH. And it's actually it's now larger than McDonald's and Netflix combined.
• 12:56
  So it's massive massive massive massive. Yeah. Shit, that's huge. And it's been around for
• 13:01
  every bit like this company's been around for a hundred years. And you know, they can't it's kind
• 13:07
  of like when Pfizer came out with Viagra, you know, they're constantly releasing these drugs. And
• 13:11
  then they just release this blockbuster drug which, you know, propels their share price, you know,
• 13:18
  for years. And then they're constantly thinking of new drugs and trying to find new solutions
• 13:25
  for our issues for health issues. And then they'll come across another one. So it's kind of you
• 13:29
  get these blockbuster drugs. I guess every kind of 10 every, you know, every decade or so.
• 13:35
  And so do you think that this drug is going to end up being as commonly used or known as Viagra?
• 13:42
  It's hard to tell. I mean, it's gone crazy on TikTok. Has it?
• 13:47
  Like so many people taking it. I don't know. They'll probably have to be some restrictions, I think,
• 13:52
  in terms of proving that you actually have type two diabetes or that kind of thing. And I mean,
• 13:59
  they can't keep up with supply. It's pretty dangerous. Like imagine if there's like young girls
• 14:03
  are totally who are wanting to lose weight because they think they need to be able to keep up
• 14:08
  beauty standards. And they're taking pills to try and lose weight. Like that's quite scary.
• 14:12
  Yeah, that is really scary. It's quite. Yeah, that's a thing with all these drugs is that they do
• 14:19
  there is a minority or, you know, there is a group of people that usually it gets into the wrong
• 14:24
  hands and is not good for society. So I mean, I just watched that oxycodon. Oh my god.
• 14:34
  Is it the one that's called painkiller or something?
• 14:36
  Yeah, sorry, it's not a documentary. It's a TV series. But yeah, it's quite wild.
• 14:41
  How that was used to combat pain. And then people got addicted. And then it's just like how easily
• 14:47
  a drug if in the wrong hands or I mean, this is a different story. I'm not saying that these drugs
• 14:54
  are the same as oxycodon at all. But it's just yeah, some drugs can have terrible side effects
• 15:02
  for society. What's oxycodon again? I think to be a painkiller. Oh, I know people that have
• 15:06
  been addicted to this. Yeah, it's quite, it's quite crazy. It's not a very nice series to watch,
• 15:11
  but it is, it's really, because you just see these people become drug addicts in this.
• 15:16
  Yeah, humans as, I mean, there's a, I can't remember what percentage of the population
• 15:21
  really susceptible to addiction problems, but it's super high. I remember I think it was a
• 15:28
  docker or something on a similar drug. And they were just talking about how some people,
• 15:33
  they just can't almost can't help it. Like they should never have been prescribed in the first
• 15:36
  place, but you just don't know how your body or your brain is going to react whether or not you're
• 15:40
  going to be someone that becomes addicted. Quite scary. And some people have addictive personalities
• 15:45
  to anything if it's like chocolate or alcohol or scary. Yeah. Anyway, on to other news. It's not
• 15:52
  that much better, to be honest. Oh, really? Sorry, it's a bit of a doom and gloomy episode.
• 15:58
  So you would have seen in the headlines, like I cannot believe how many natural disasters
• 16:05
  there have been even just this year, but it's been like increasing and increasing and increasing,
• 16:10
  like in New Yorker and Europe, like there's a huge massive storm at the moment and like I betha.
• 16:16
  And then we've just had all these wildfires and grease like it's crazy. And then the hurricanes
• 16:23
  in the US, honestly, I just feel like I turned on the TV or put up my news on my phone. And it's just
• 16:28
  like, oh, the worst hurricane, all the worst storm and 50 years, you know, like it's getting like
• 16:34
  every day. It's quite crazy. But anyway, why does it happen? It's like global warming is so
• 16:41
  if you see KED, I don't know why I'm not saying it. There's no babies listening, but I mean, even just
• 16:46
  our summer that we've had here that we're whining about at the beginning is 100% there. And
• 16:51
  same with the New Zealand, like last the summer we just had and it was just storms. I just don't
• 16:55
  think you need any more proof that the world is starting to tumble. I know. All those naysayers are
• 17:02
  like global warming's not happening. It's like, have you looked outside? Are you a newspaper?
• 17:07
  Why? Are you sleeping under a rock? Honestly, yeah. Like what would Donald Trump be doing? I wonder.
• 17:15
  Sometimes I feel like with those people, though, it's just like, ignorance is bliss. You know,
• 17:19
  like in time, not that's the wrong term, but you know, in terms of, isn't it just
• 17:22
  pretending that it's not existing? Yeah, because it's too big of a problem to solve. You know, it's like,
• 17:28
  you know, I don't even want to condone it or, you know, let it out. But it's, yeah, in any way,
• 17:34
  that's not the best approach at all. But anyway, this is the all these weather events is having
• 17:39
  a huge impact on the insurance industry. And that in turn is having a huge impact on inflation.
• 17:47
  How? Yes. Great question. So, well, well, I've got to think about how an insurance company
• 17:54
  works is that you pay your premium, which is your monthly amount to your insurance company to
• 17:59
  cover you in case of an emergency. So say your house gets blown away by a hurricane. You've paid
• 18:05
  your insurance. And then when your house gets blown away, you know, their insurance company's
• 18:09
  going to cover you in the simplest form. Now, if they've got this increased frequency of these
• 18:14
  events for insurance companies, they're sitting there going, oh, you know what? We need more money
• 18:20
  because we're having to pay out more money because of these increased natural disasters. So they're
• 18:25
  going back to us and saying, okay, look, we need to increase the amount that you're paying us
• 18:30
  because there's been an increase frequency of events. So this causes our premiums or what we
• 18:36
  pay monthly to go up. And this all adds to inflation because the price of everything is growing up.
• 18:43
  So in the US, insurance premiums have gone up about 40% since 2018 and they're up over 10% since
• 18:51
  last year. So it just is another thing that's adding to the whole concept of inflation remaining
• 19:00
  high. When things are increasing in price, that is not good for inflation. So does this mean
• 19:05
  then that people are going to stop being insured for natural disasters? Because I remember when
• 19:11
  all of those earthquakes and things were happening in Bali a few years ago, when you were
• 19:16
  traveling there, all of a sudden you couldn't get insurance. Yeah. Is that going to then happen
• 19:20
  just for the everyday person? Yeah. If you've got a house on a beach or near a beach and
• 19:28
  global warming means that we're going to have rising tides, we're going to have more storm
• 19:33
  surges, all of that, then yeah, you could get a situation where your insurance company turns around
• 19:38
  and goes, you know what, we're not going to show you. Or we can ensure you, but it's going to cost
• 19:44
  you like a ridiculous amount that it's almost probably not even worth getting. Like if they turned
• 19:49
  around and said it's going to cost you a couple of hundred thousand dollars to ensure your house
• 19:56
  which is worth only worth a couple of hundred. You know, like it's kind of at what point does
• 20:01
  to cost benefit not actually make it worthwhile. And then good luck trying to sell that house as well
• 20:07
  because who's going to buy that when they can't get insured or the insurance is so high. So all
• 20:15
  these factors come into play which means yeah, it's going to be interesting to see how it plays out
• 20:20
  in terms of where people reside, you know, and how that all is impacted in terms of location of
• 20:27
  of populations and people and cities and yeah, it's going to be interesting. Oh my god, this is so
• 20:32
  scary. It's so scary. Yeah. I think a lot of us have taken for granted insurance in a sense,
• 20:38
  like we're like, oh, boring insurance, wow, wow, yeah. But you know, I think the more that we've
• 20:42
  learned about insurance over the last couple of months, we're like, holy shitballs, we all need it.
• 20:47
  PSVN wants to go back and listen to our episode. I can't remember what it's called. It is episode
• 20:54
  63. So if you want to hear, we actually have a really good episode on insurance. It's not
• 21:00
  home and content insurance, but it is more personal insurance, but it teaches you how insurance
• 21:07
  works. And that is episode 63, a guide to adulting that's raising the curve as well, not the curve
• 21:14
  weekly. But I guess it's just scary because in our heads, we've sort of been like, oh yeah,
• 21:18
  nah, it's all fun because insurance will cover it if something out of our hands happens. But
• 21:23
  the reality is you're right. Like insurance companies all over the world can't insure everybody
• 21:29
  for natural disasters because they're just going to start happening more and more and more. And
• 21:33
  it's just the inevitable. So what are those companies? Where do they draw the line in terms of
• 21:38
  what can be and can't be insured? It's kind of scary. Yeah, no, it is. And even in the US, so
• 21:43
  they've had 15 weather events this year. So in this eight months versus an average of about eight
• 21:53
  over the last 20 years. So it's not just something that we think we're seeing, it is actually
• 21:59
  happening. We've had a massive step up in these weather events in the last year. So
• 22:07
  shit, that's good. It'll be interesting to see what happens, but it is just a case of they're
• 22:12
  going to have to charge more. And that comes back to the consumer, which is you and me. So
• 22:17
  fun times ahead. Do you think, sorry, just quickly, do you think it would be best to get insurance
• 22:23
  now then before they start to, you know, for example, if you already are paying a certain amount,
• 22:29
  they probably can't up it by double. Can they? If you already committed it, it would be new people
• 22:33
  joining or can they? No, they definitely can. Mine increases every year. I would know that if I
• 22:41
  have insurance. Yeah, last year episode 63. I know. I think it's a problem is because we now do
• 22:51
  this so much work like in terms of talking about all the things I need to do. It's different.
• 22:55
  I'm not a consumer. You know, like when you're cooking food and you're eating it for a whole time
• 23:00
  that you're cooking the meal by the time you serve it, you kind of like don't even want to eat it
• 23:03
  anymore. Yeah, it's kind of happening, but oh gosh, we're financial stuff. Oh my god, please don't
• 23:08
  have that. I know it's dangerous. I need to get a will after our last episode. Yeah, it's like
• 23:14
  must do that. It's on the to-do list, right? Yes. Yeah. Oh, the to-do list is so long. I know. I
• 23:20
  need the world to just pause for a week would be really good. Could we just go back into lockdown for
• 23:26
  a second just for us to just get out to do it? Oh my god, please. Actually, every time I do
• 23:30
  like this, we end up going into lockdown. So if we did, would you come out to the country?
• 23:37
  Maybe. Really? You'd rather be in a city that's doing nothing than out here with my beautiful
• 23:41
  family. That's good to know. You're not invited. Should we go into lockdown? I don't think I can
• 23:45
  handle more than one softy whoreight to be honest. Firstly, that much cooler than me. That way
• 23:53
  cooler than me. That's easy. Secondly, fuck you. There's honestly acres and acres and acres. You
• 24:02
  could run away from me and like not even see me for days. Okay, I'm coming. No, take it out, you're not
• 24:06
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• 24:39
  See you next Tuesday. I mean Monday.