Novo Nordisk weakens again on interim results readout

Novo Nordisk's already depressed share price has fallen again this morning, despite reporting an 18% increase in sales in the first half of this year.

The Danish drugmaker, which has already cut its sales and profit forecasts for the year due to a hit on demand for its semaglutide-based therapies for diabetes and obesity in the US, warned again this morning that it will continue to face competition from compounded versions of the GLP-1 agonist.

Novo Nordisk has just launched a fresh round of legal action to try to curb the actions of compounders, which are using loopholes in the law to continue to sell semaglutide despite the drug no longer being on the FDA's shortages list.

However, the company has estimated that around a million people in the US are still turning to compounded GLP-1s – despite a drive to expand its sales channels through telehealth partners – and it does not anticipate a fall in usage of the copycat versions through the remainder of this year.

Shares in the company were down more than 2% at the time of writing, having already lost more than 50% of their value since the start of the year.

Outgoing chief executive Lars Fruergaard Jørgensen, who is scheduled to be replaced by Maziar Mike Doustdar tomorrow, said Novo Nordisk is "taking measures to sharpen our commercial execution further, and ensure efficiencies in our cost base while continuing to invest in future growth." Details of these measures have yet to be released.

Overall sales in the first half reached just under DKK 155 billion ($24.1 billion), below analyst expectations, with obesity drug Wegovy rising 78% to DKK 36.9 billion, while Ozempic slowed to 15%, contributing DKK 64.5 billion in the period.

Ozempic and Wegovy have been affected by competition from Eli Lilly's diabetes therapy Mounjaro and Zepbound for obesity, both based on dual GLP-1/GIP agonist tirzepatide, which have been gaining market share on the back of head-to-head data showing improved efficacy over Novo Nordisk's products.

A recent US pilot that will look at extending Medicare and Medicaid coverage of Wegovy and other weight-loss therapies could help firm up the market for the drugs. However, the Trump administration's recent rhetoric on drug pricing, including the most favoured nation pricing plan, could apply a brake to growth if it comes to fruition.

Looking to regain its position in the market, Novo Nordisk said it is advancing subcutaneous and oral amycretin, a dual GLP-1 and amylin agonist, into phase 3 development for weight loss. Meanwhile, it is waiting for regulatory approval of a high-dose Wegovy formulation and continues late-stage studies of CagriSema, a combination of amylin agonist cagrilintide and semaglutide, which has so far generated disappointing clinical results.

At the same time, it has trimmed its pipeline by stopping development of a once-weekly GLP-1/GIP co-agonist that had reached phase 2, as well as a CB1 receptor blocker – acquired as part of its $1 billion takeover of Inversago in 2023 – which recently completed a phase 1 trial and was also being studied for weight loss.

"With more than one billion people living with obesity globally, including more than 100 million living in the US, and only a few million on treatment, I am confident that under Mike Doustdar's leadership Novo Nordisk will maximise the significant growth opportunities, supported by a strong product portfolio and future pipeline," said Jørgensen.

Novo Nordisk has also said it will consolidate its R&D leadership under new chief scientific officer Martin Holst Lange, who will formally take over from Marcus Schindler tomorrow.