Novo Nordisk Shares Decline as Weight Loss Drug Trials Underperform

A head-to-head trial of Novo Nordisk’s next-generation obesity drug, CagriSema, has revealed disappointing results in comparison to rival Eli Lilly’s Mounjaro. The trial results have triggered a significant sell-off in Novo Nordisk shares, which fell by approximately 16.5 per cent in Copenhagen, leading to a staggering loss of roughly $400 billion in market value since their peak in 2024.

The open-label trial aimed to demonstrate that CagriSema would be at least as effective as Lilly’s tirzepatide, marketed as Mounjaro for diabetes and Zepbound for weight loss. However, CagriSema achieved only a 23 per cent reduction in body weight over 84 weeks, contrasting with the 25.5 per cent reduction reported for tirzepatide. Such results have raised questions about CagriSema’s market potential.

CagriSema, combining semaglutide and the molecule cagrilintide, was positioned as a successor to the highly successful Wegovy, which is nearing patent expiry in various markets. The recent trial results pose a challenge to Novo Nordisk’s growth strategy, especially as the company faces increased competition in the fast-evolving weight-loss sector.

Following these disappointing results, analysts assert that Zepbound remains the clear market leader for now. The market is witnessing intensified pricing pressures stemming from a healthcare cost reduction deal with the Trump administration, along with mounting competition, particularly from Eli Lilly.

As Novo Nordisk prepares for future trials and seeks to explore different dosing strategies for CagriSema, the company faces a critical juncture. Novo’s shares reflect a broader concern regarding the company’s ability to maintain its strong market presence in the face of growing competition and regulatory challenges.

The coming months will be crucial as Novo Nordisk awaits a decision from the Food and Drug Administration regarding CagriSema, a development that could impact its market positioning significantly.