Novo Nordisk‘s shift from a market darling to a serious underperformer has set the stage for a transitional 2026 as the Danish drugmaker fights to regain investor confidence in its weight loss business.
Novo’s stock just experienced the worst year on record since it began trading on the copenhagen stock exchange over three decades ago. Multiple reasons lie behind the dramatic drop: a series of guidance cuts, strides by chief rival Eli Lilly, a leadership upheaval, and cheap copycat drugs flooding the crucial U.S.market.
With just about a week to go until 2026, Novo announced that its new weight loss pill under the brand name Wegovy had been approved in the U.S., making it the first oral GLP-1 treatment approved for weight loss. It sent shares up nearly 10% as investors banked on Novo being able to, at least partly, hold Eli lilly and others at bay.
That “early Christmas present,” as one analyst called it highlights many of the key themes Novo will have to face this year.
From injectables to pills
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Novo’s position as the first company to launch an oral option could help it make up some of the ground it’s lost over the past year in the GLP-1 space. Analysts mostly agreed that the Wegovy pill’s approval was a big deal, even though many had already expected a positive decision before the end of the year.
Eli Lilly is expected to get its own weight loss pill orforglipron approved by the U.S. Food and Drug Administration by no later than the second quarter of this year, and investors will closely watch how that competition plays out.Still life of the big three injectable prescription weight loss medicines. Ozempic, Victoza and Wegovy.(Photo by: Michael Siluk/UCG/Worldwide Images Group via Getty Images)
Ucg | Universal Images Group | Getty Images
Novo Nordisk Faces Trump Pressure and Internal Strife as Wegovy & ozempic Growth is Key
President Donald trump’s second term presents significant challenges for pharmaceutical companies, including Novo Nordisk. Throughout the year, Trump has threatened ample tariffs unless pharma firms invest heavily in the U.S., and has aggressively targeted high U.S.drug prices.
The disparity between U.S. drug prices – often more than four times those in Europe – is a long-standing issue. Last year, Novo’s then-CEO Lars Fruergaard Jørgensen testified before a U.S. Senate panel chaired by Sen.Bernie Sanders, facing accusations of price gouging. Trump has escalated the pressure, advocating for “most Favored Nation” pricing, aligning U.S. prices with the lowest costs in other wealthy nations.
In November, the Trump administration secured agreements with Novo and Lilly to lower prices of their leading GLP-1 medications for Medicare and Medicaid, alongside direct-to-consumer discounts via the upcoming TrumpRx.gov website, launching in January.
The emerging direct-to-patient market is crucial for future sales, but faces competition from compounding pharmacies, which produce cheaper drug copies and thrived during earlier semaglutide shortages.
“the TrumpRx deal will help novo become more competitive with compounders on price, although a faster orforglipron launch could reduce its ability to gain momentum in the [direct-to-patient] channel ahead of Lilly,” noted Morningstar’s Karen Andersen. She added, “We’ve already seen the direct-to-patient market beginning to develop nicely in 2025, notably for LillyDirect… oral GLP-1 drugs will be even better suited to this channel,” predicting a further shift towards cash payments.
Headwinds
Investors are keenly observing whether Novo’s new leadership can revitalize U.S.operations.
In May, Novo replaced its CEO of eight years, citing “recent market challenges” and underperforming stock. Six months later, the entire self-reliant board resigned following disagreements with Novo’s controlling shareholder regarding the speed of change and concerns about addressing U.S. market issues.
“The marketable growth for Wegovy and Ozempic is a must-win battle for [CEO] Mike Doustdar and the new board,” stated Søren Løntoft Hansen, a Sydbank analyst.
Novo Nordisk’s Wegovy Pill Approval: A Critical Win Amidst Strategic Shifts and Obesity Market Competition
Novo Nordisk’s recent approval of a pill version of its blockbuster weight-loss drug, Wegovy, marks a significant milestone for the company, particularly following a year of strategic maneuvering and increasing competition in the obesity treatment market. The approval addresses patient demand for an oral alternative to the injectable Wegovy and positions Novo Nordisk to further solidify its dominance in a rapidly expanding field. However, the company has faced recent challenges, including deal terminations and acquisition pursuits, raising questions about its strategic direction.
The Rise of Oral Weight Loss Medications
For years, weight loss medications have largely been administered via injection, like Wegovy and Eli Lilly’s Mounjaro. The FDA approval of Wegovy in pill form (https://www.fda.gov/news-events/press-announcements/fda-approves-first-oral-weight-loss-medicine) on May 23, 2024, represents a major shift, offering patients a more convenient administration method. this convenience is expected to broaden access and appeal to a wider patient base.
The demand for effective obesity treatments is surging, driven by rising obesity rates globally. According to the Centers for Disease Control and Prevention (CDC),the prevalence of obesity in the United States was 41.9% in 2020 (https://www.cdc.gov/obesity/data/adult.html). This creates a substantial market opportunity for pharmaceutical companies developing innovative solutions.
Novo Nordisk’s Strategic Landscape
despite its leading position, Novo Nordisk has experienced a period of strategic uncertainty. Analysts have pointed to a series of conflicting moves, including:
* Hims & Hers Deal Termination: Novo Nordisk ended its partnership with Hims & hers for Wegovy distribution in June 2023 (https://www.cnbc.com/2023/06/23/novo-nordisk-ends-wegovy-deal-with-hims-hers.html).
* Metsera Acquisition Pursuit: The company engaged in a bidding war for Metsera, a potential acquisition target, ultimately losing out to Pfizer in November 2023 (https://www.cnbc.com/2023/11/08/metsera-accepts-pfizers-10-billion-bid-in-ongoing-ma-battle.html).
These actions, as noted by analysts like Sarah Andersen, suggest a period of internal reassessment and a search for optimal strategic positioning. The Wegovy pill approval is seen as a crucial win, providing a much-needed positive development after a series of challenges.
Competition Heats Up in the Obesity Market
Novo Nordisk isn’t the only player vying for dominance in the obesity treatment market. Eli Lilly is a major competitor, with its own injectable drug, Mounjaro (tirzepatide), demonstrating significant weight loss results in clinical trials. Lilly is also developing an oral version of Mounjaro.
moreover,Roche is entering the fray,with late-stage trials for its obesity candidate,CT-388 (https://www.roche.com/media/press-releases/media-release-archive/2024/roche-advances-obesity-pipeline-with-positive-phase-2-data-for-ct-388.html). The increasing number of competitors and the development of diverse treatment options – including drugs targeting multiple appetite-regulating hormones – are expected to intensify competition and drive innovation in the field.
Looking Ahead
The approval of the Wegovy pill is a pivotal moment for Novo Nordisk. The company now faces the challenge of successfully launching and scaling production of the oral formulation while navigating a competitive landscape and executing its long-term strategic vision. Analysts believe that continued success hinges on consistent execution and the ability to capitalize on the growing demand for effective and
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