Investors wiped $70 billion off Novo Nordisk’s market value on Tuesday after the maker of weight-loss drug Wegovy issued a profit warning and named a new CEO, as it battles rising competition in the obesity drug market.<\/p>\n
Novo (NOVOb.CO), opens new tab named Maziar Mike Doustdar as its new chief executive, turning to a veteran insider to revive sales and reassure investors rattled by fears the Danish drugmaker is losing ground in the obesity drug race it started.<\/p>\n
Doustdar’s appointment failed to stem a stock market rout sparked by Novo slashing its outlook for 2025 sales growth to between 8% and 14%, from between 13% and 21% previously. Its shares plunged nearly 30% before paring some losses to trade down over 20% by mid-afternoon. The shares are now down 44% this year.<\/p>\n
“The magnitude of the guidance cut is a shocker,” Markus Manns, a portfolio manager at mutual fund firm Union Investment, a Novo shareholder, told Reuters, adding that Novo’s issues went deeper than “compounded” copycats to Wegovy.<\/p>\n
Compounded drugs are custom-made medicines that are based on the same ingredients as branded drugs.<\/p>\n
Novo has been hit by copycats of its GLP-1 drugs Wegovy for weight-loss and Ozempic for diabetes. U.S. law bars pharmacies from replicating approved drugs, but has allowed ‘compounding’ for patients needing custom doses or formulations.
\nThe company said in a statement that it cut its 2025 sales outlook due to lower growth expectations in the second half in the U.S., both for Wegovy and Ozempic in the GLP-1 diabetes market.<\/p>\n
The drugmaker, which became Europe’s most valuable listed company following the launch of Wegovy in 2021, is now facing a reckoning as it looks to turn things around after the abrupt removal in May of CEO Lars Fruergaard Jorgensen.<\/p>\n
At its peak in June 2024, Novo was worth as much as $615 billion, but its shares have plunged on investor concerns about the company’s experimental drug pipeline and its ability to navigate challenges in the U.S. market.<\/p>\n
“The stock has gone from being a market darling to one of its biggest letdowns,” said Angelo Meda, portfolio manager and head of equities at Banor SIM in Milan, which has a small Novo stake. “The biggest concern is the illegal channel siphoning away market share – something that’s hard to quantify. Rebuilding trust will take time.”<\/p>\n
Some analysts and investors had argued that Novo should select an American, or a person with extensive experience working in the United States as its next CEO. Novo has lost its first-mover advantage in the United States this year to U.S. rival Eli Lilly (LLY.N), opens new tab.<\/p>\n
The new chief executive’s most urgent challenge, according to investors and analysts, is to revive Novo’s performance in the United States, the largest market by far for weight-loss drugs and where they are most profitable.<\/p>\n
Novo launched its weight-loss drug Wegovy nearly two and a half years before Eli Lilly’s Zepbound. But Zepbound prescriptions surpassed those of Wegovy this year by more than 100,000 a week.<\/p>\n
In May, Novo said it expected many of the roughly one million U.S. patients using compounded GLP-1 drugs to switch to branded treatments after a U.S. Food and Drug Administration ban on compounded copies of Wegovy took effect on May 22.<\/p>\n
“Unfortunately, our latest market research indicates that has not happened,” Chief Financial Officer Karsten Munk Knudsen said on a call with analysts on Tuesday. One million or more U.S. patients are still using compounded GLP-1s, he said.<\/p>\n
Novo has stepped up its dialogue with the U.S. FDA to limit unlawful compounding of its drugs, the head of U.S. operations David Moore added on the call. “Compounding continues to be an issue that we have to address,” Moore said.<\/p>\n","protected":false},"excerpt":{"rendered":"
Investors wiped $70 billion off Novo Nordisk’s market value on Tuesday after the maker of weight-loss drug Wegovy issued a profit warning and named a new CEO, as it battles rising competition in the obesity drug market. Novo (NOVOb.CO), opens new tab named Maziar Mike Doustdar as its new chief executive, turning to a veteran […]<\/p>\n","protected":false},"author":2,"featured_media":1185,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[37],"tags":[227],"class_list":{"0":"post-1184","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-sitefansalaran-industry-news","8":"tag-wegovy-maker-novos-profit-warning-triggers-70-billion-share-rout"},"yoast_head":"\n