Eli Lilly is widening its lead over Novo Nordisk in the obesity drug market, despite an ambitious attempt by the Danish company to revive growth beyond its blockbuster Wegovy and Ozempic treatments.
Novo’s shares came under pressure after investors were presented with plans for a new generation of medicines at its capital markets day on Monday. The targets were viewed as broadly in line with the wider pharmaceutical industry, rather than sufficient to restore the rapid growth that once set the company apart.
The concerns come as Lilly continues to gain ground in both injectable and oral treatments for obesity, backed by a large commercial operation and a pipeline of potential successors to its leading products.
Novo is seeking to establish an early advantage in obesity pills after launching the oral version of Wegovy months before Lilly’s rival Foundayo. Mike Doustdar, Novo’s chief executive, said early take-up indicated that some patients had been waiting for an alternative to injections.
“If that continues to the extent that we have seen, then yes, mathematically, by the end of the decade, there is going to be a larger portion on the pill than injectable,” he said.
But Lilly is already making progress. Chief executive Dave Ricks said one in three new US patients starting an oral GLP-1 treatment was taking Foundayo, with the company’s share of the pill market increasing “week by week”.
Lilly has also claimed an early advantage in the US Medicare market for obesity medicines, after federal coverage began in July. Mr Ricks said 700,000 seniors had started GLP-1 treatments through Medicare, with 70 per cent taking Lilly medicines.
Patients covered by Medicare have shown a particular preference for Lilly’s Zepbound injection, according to the company. Lilly said in August that it held about 61 per cent of the US GLP-1 market in the second quarter, compared with roughly 39 per cent for Novo.
Lilly’s commercial advantage
Analysts expect Lilly to retain its position at the top of the obesity drug market, citing its sales strength, international expansion plans and more advanced pipeline of new medicines.
David Risinger, an analyst at Leerink Partners, said Lilly was “in the leadership position” and was likely to remain there because of its “substantial commercial advantage” and range of potential follow-on products.
He expects Foundayo to continue increasing its share of the global oral GLP-1 market. The medicine is a small-molecule drug, which can be manufactured at scale differently from peptide treatments such as Novo’s Wegovy pill and current injectable GLP-1 medicines.
Foundayo produces less weight loss on average than the Wegovy pill, but it does not come with the same food and water restrictions, a feature that could appeal to some patients. Novo executives did not directly address whether Lilly’s treatment would be easier to manufacture and scale, although they said the Danish company was investing billions in production facilities.
Novo aims to increase the number of patients using its GLP-1 medicines tenfold by 2030 and has said supply should not become the problem it was during the early years of Ozempic and Wegovy.
Lilly is also developing medicines intended to strengthen its position in the next phase of the market. These include retatrutide, a treatment that targets three gut hormones and has delivered greater weight loss than existing obesity drugs in clinical trials. Lilly plans to seek approval for it in the first quarter of 2027.
The company is also working on a weekly injection targeting the amylin receptor, a pathway involved in appetite and feelings of fullness. Mr Risinger said it could be particularly important for people who do not tolerate GLP-1 medicines or do not respond adequately to them.
Novo’s next-generation pipeline
Novo is planning more than five potential multi-blockbuster medicines by 2030 and is targeting more than 150 billion Danish kroner, or about 23 billion dollars, in pipeline sales by 2035.
It also wants at least five phase-three programmes in obesity and diabetes, alongside another five in other therapeutic areas. The strategy reflects the scale of the challenge facing a company whose semaglutide-based products account for about two-thirds of its sales.
Patent protection for semaglutide, the active ingredient in Wegovy and Ozempic, runs until 2032. The two medicines generated combined sales of 31 billion dollars in 2025, leaving Novo under pressure to show that new products can replace that revenue when generic competition emerges.
The company’s pipeline includes CagriSema, a combination of semaglutide and cagrilintide, which is expected to launch early next year. Standalone cagrilintide and a higher-dose version of CagriSema are expected to follow in 2028.
Investors have been sceptical about CagriSema since earlier late-stage trials showed less weight loss than expected. Novo maintains that the treatment is effective and sufficiently different to succeed commercially.
New late-stage data presented this week showed CagriSema produced greater weight loss than tirzepatide, the active ingredient in Lilly’s Zepbound and Mounjaro, in a trial involving people with type 2 diabetes. However, the study used lower doses, while tirzepatide had previously outperformed CagriSema in a separate phase-three trial using higher doses of both medicines.
Novo’s chief scientific officer, Martin Holst Lange, said the future market would offer patients and doctors a range of options, including treatments focused on tolerability, muscle preservation, convenience and obesity-related conditions.
“We can’t do that with one single drug,” he said.
Novo plans to build enough capacity to supply oral obesity treatments to 15 million people by 2030 and believes pills could eventually represent half of the global obesity drug market. It said its Wegovy pill had already generated seven million US prescriptions, with 90 per cent of sales coming through cash-pay channels.
However, investors are seeking more than a promising pipeline. They have questioned whether Novo’s future medicines can command premium prices once Wegovy and Ozempic lose exclusivity, while the company’s 2026 to 2030 revenue forecast points to growth in line with pharmaceutical peers rather than a return to its earlier surge.
Novo must therefore defend its existing obesity franchise against Lilly while financing the products intended to replace it, as the rival drugmaker continues to extend its lead.
