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Novo Nordisk CEO Maziar Mike Doustdar waits for the start of the pharmaceutical company’s annual general meeting in Copenhagen, Denmark, March 26, 2026. Tom Little | Reuters Danish drugmaker Novo took the world by storm with its diabetes and weight loss drugs Ozempic and Wegovy. But this week, the company failed to reassure investors that it has a plan to compete after semaglutide, the active ingredient in those medicines, loses exclusivity in key markets in the early 2030s.
It announced plans to launch more than five potential blockbuster drugs by 2030 at its Capital Markets Day on Monday. Shares fell 8% , compounding two years of decline. Barclays analysts noted "limited new disclosure to increase confidence," while Jefferies said it failed to "derisk the trajectory or offer a strategic reset." Meanwhile, shares in Novo's chief rival, Eli Lilly, are up 58% over the past 12 months.
Stock Chart IconStock chart icon Novo shares are lagging behind its chief competitor Eli Lilly's. Sydbank analyst Soren Hansen, who attended Novo's Capital Markets Day, told CNBC the announcements were "all about trust." Asked about this, Novo CEO Mike Doustdar said: "The reaction of the market is a testament that we still need to do more work on building trust of the market." Sitting alongside two of the executives charged with delivering the new strategy, he told CNBC: "Trust is compounded and is built over time." Novo has spent billions expanding factories to make more weight-loss drugs and is racing to replenish its pipeline with the next generation of medicines. But Doustdar told CNBC credibility would now have to be rebuilt through financial and scientific results "quarter by quarter." "Our job is to not deviate from our strategic direction and continue outperforming our own expectations," he said.
Diversifying again The new strategy to diversify beyond the core pipeline also contrasts with when Doustdar emphasized simplification and a sharpened focus on diabetes and obesity on becoming CEO last August. Doustdar rejected the suggestion that amounted to a "U-turn." "There is actually not as big of a disconnect that sometimes meets the eye," he said. He added that, when he became CEO , he found that, outside diabetes and obesity, there had been a fourfold increase in early-stage assets moving toward clinical development over the previous three to four years, while the core pipeline had been essentially flat.
Then, it was important to stress internally and externally that the focus was on diabetes and obesity, "and that actually worked," he said. Pointing to the early-stage pipeline unveiled on Monday, Doustdar said that Novo has now reached the point where it can broaden its ambitions again, including in cardiovascular, liver and blood disorders. "It's now time to go back and broaden that area as well, so we don't only stay in core," the CEO added.
However, not everyone is convinced Novo is diversified enough. In their note, Jefferies said the company's portfolio remains heavily exposed to obesity despite the push to diversify its portfolio, as the loss of semaglutide exclusivity looms. watch now Speaking on CNBC's "Squawk Box Europe" earlier on Tuesday, Doustdar said that acquisitions could play a larger role in filling gaps outside Novo's traditional strongholds. He did not rule out buying obesity or diabetes assets, but added it would "be more obvious" to make deals in areas outside of Novo's core therapy areas.
Betting on breadth There may not be a single successor to Wegovy. Investors have focused on headline weight-loss percentages, but the company is betting that the obesity market will increasingly fragment as patients and doctors choose medicines based on other factors as well, like side effects, muscle preservation, other health benefits, convenience and pill versus injection. Martin Holst Lange, Novo's chief scientific officer, told CNBC that companies with broad portfolios will ultimately be the most competitive.
"We cannot do that with one single drug," Lange said. Read more pharma news Cholesterol drug setback casts doubt over multibillion-dollar race FDA approves daily HIV pill from Gilead designed to simplify treatment for some patients Eli Lilly takes weight-loss pill battle global with first Foundayo approval in Europe AstraZeneca may buck a decade of pharma strategy to buy U.S. scale Trump's generic drug tariffs: What they could mean for medicine prices, manufacturers and supply AstraZeneca's trial flop raises a bigger question: Is its pipeline premium becoming more vulnerable? Novo Nordisk sues Eli Lilly, alleging misleading GLP-1 advertising Novo Nordisk's head start on GLP-1 pills forces investors to rethink Eli Lilly's dominance Prices, pipelines and patent cliffs: Inside pharma's big reset UK's biggest drugmakers see surprise profit bump, even as pharma grapples with U.S. policies Pharma bets a little-known form of cholesterol will underpin its next blockbuster heart drugs Novo is developing drugs aimed at moderate weight loss with fewer side effects as well as treatments that could result in greater weight loss.
It is also studying drugs it hopes will preserve muscle and treat obesity-related conditions. Its pipeline includes CagriSema, which Novo plans to launch in 2027, followed by cagrilintide as a monotherapy. Novo is also developing next-generation oral drugs, including zenagamtide, an oral amylin treatment and an ACSL5 inhibitor in combination with semaglutide. watch now Hong Chow, the company's executive vice president for product and portfolio, said Novo commissioned a survey of 37,000 people with obesity, and roughly a third said they wanted to lose as much weight as possible while others prioritized factors including speed of weight loss and quality of life.
Lange said that CagriSema remains competitive despite 2024 late-stage trial results that caused a sell-off because investors had hoped for greater weight loss. He said individualized doses could produce better results than the 23% weight loss seen in the trial by allowing patients to balance efficacy, side effects, and the pace of weight loss. He also pointed to newer data showing strong results at lower doses, including an average 21% weight loss among patients with obesity.
He added CagriSema's potential benefits extend beyond weight loss to glycemic control and other obesity-related conditions. Lange recognized that "what the investors want to see is the results." The pill factor "If you ask me what is underestimated, I think it's really our clear leadership in the orals," Chow said. The company has said that more than 80% of U.S. patients starting to take its Wegovy pill had not previously used a GLP-1 treatment, suggesting the convenience of a pill over an injection was key to its rapid uptake.
It plans to scale manufacturing to treat 10 times as many people living with obesity with weight loss pills by 2030. It is also developing four additional oral obesity assets it aims to bring to market by then. Novo has told investors that multiple obesity treatments, a major oral franchise and new businesses outside diabetes and obesity can make it competitive.
Meanwhile, Citi said on Tuesday that Wegovy pill launches outside the U.S. will be an important test of the strategy, while remaining cautious about longer-term obesity pricing and competition. It is forecasting mid-single-digit annual growth until 2030 and the Capital Markets Day announcements "offered little change" to that, Citi said. The bank reiterated its neutral rating on the stock.
Source: CNBC
