Novo Nordisk A/S slumped after a pill from rival Eli Lilly & Co. helped patients shed weight and control blood sugar about as well as its injected blockbuster Ozempic.
The stock dropped as much as 9.8% to 380 kroner early in Copenhagen, the first trading day since the Thursday announcement that buoyed Lilly.
The triumph of Ozempic, Wegovy and related drugs including Lilly’s Zepbound has set off a push toward the next frontier: a pill that’s easier to take and less expensive to make. The Lilly study puts pressure on Novo, whose market value has dropped by a third since the start of the year.
The potential competition prompted Naresh Chouhan, an analyst at Intron Health, to cut his sales forecast for Novo in 2030 by 20% and slash his price target for the shares.
The Lilly data “looks like it is set to transform the GLP-1 space and raise the bar for both oral and injectable therapies” as Novo’s Wegovy already struggles to compete with Zepbound, Chouhan wrote.
The Danish drugmaker said it has filed with US regulators for approval of a high-dose pill with the same active ingredient as Ozempic for weight loss.
Obesity shots made by Novo and Lilly have generated billions of dollars in sales. While rivals including Pfizer Inc. have suffered setbacks, analysts said success in the pill category is critical to creating the $130 billion market they predict by the end of the decade.
Novo has been selling a lower dose pill with semaglutide, the key ingredient in Ozempic and its sister drug Wegovy, since 2019 under the brand name Rybelsus.