Novo Nordisk is betting that a new weight-loss tablet can help restore confidence in the Danish drugmaker, but investors remain unconvinced that the treatment will be enough to reverse a sharp fall in its fortunes.
The company behind Ozempic and Wegovy has seen its shares lose about 70 per cent from their mid-2024 peak, when it briefly became Europe’s most valuable listed company. The decline reflects intensifying competition from Eli Lilly, falling prices and doubts over Novo’s next generation of obesity medicines.
Mike Doustdar, Novo Nordisk’s chief executive, has rejected the idea that the business is locked in a winner-takes-all contest with its American rival. “We have more assets than people are giving us credit for,” he told The New York Times, arguing that the expanding obesity market could support several successful treatments.
Novo Nordisk’s weight-loss pill faces investor test
The once-daily Wegovy pill, launched in the United States in January, has provided a rare bright spot. Novo said in August that the tablet had passed five million prescriptions since its launch, describing the product portfolio as a key driver of growth.
That performance helped the company raise its 2026 outlook. Adjusted sales and operating profit are now expected to range from unchanged to a fall of 6 per cent at constant exchange rates, an improvement on the previous forecast of a decline of between 4 and 12 per cent.
But the upgraded guidance has done little to settle concerns about the years ahead. The main US patent protecting semaglutide, the active ingredient in Wegovy and Ozempic, is due to expire early in the next decade, raising the prospect of cheaper rivals entering the market.
Novo’s position has also been weakened by the progress of Eli Lilly’s competing medicines and by the availability of lower-cost compounded versions. The company has responded with a sweeping restructuring, cutting about 9,000 positions worldwide, including 5,000 in Denmark.
The job cuts formed part of a transformation intended to simplify the organisation and redirect resources towards diabetes and obesity. Novo says the changes are expected to deliver annualised savings of about 8 billion Danish kroner from 2026 onwards.
Doustdar, who became chief executive in August 2025, has sought to make the company more commercially aggressive. Novo is repositioning Rybelsus, its semaglutide tablet for type 2 diabetes, as “the Ozempic pill” in an effort to benefit from the stronger public recognition of that brand.
The business has also taken a more combative approach to its competitors. It has launched legal action against more than 150 companies over a range of claims and is suing Eli Lilly in the United States, alleging deceptive advertising.
Under Doustdar, Novo has acquired a more distinctly American character. More than half its sales are generated in the US, where it employs about 10,000 people, and the company is pressing ahead with a $4 billion expansion in Clayton, North Carolina.
The chief executive is the first non-Danish leader of Novo Nordisk. Born in Iran, an Austrian national and raised in the US, he spent most of his career running the company’s international operations rather than working at its headquarters outside Copenhagen.
Some investors believe a broader business strategy is needed. Almost 95 per cent of Novo’s sales in the first half of 2026 came from diabetes and obesity medicines, while Eli Lilly has been building businesses in areas including neuroscience and immunology.
The immediate focus is likely to be CagriSema, an experimental combination treatment that Novo hopes can compete with Lilly’s leading obesity drugs. In a trial, however, it failed to demonstrate greater weight loss than Lilly’s existing treatment, disappointing shareholders.
Novo has said further studies will examine whether a higher dose can deliver greater weight loss. The company’s phase-three trial of the higher-dose version is planned for the second half of 2026, with results from another study expected in the first half of 2027.
Another potential successor, zenagamtide, has entered the phase-three stage but is still likely to be years from commercial launch. That has left investors searching for a near-term catalyst capable of changing the direction of the shares.
Markus Manns, a portfolio manager at Union Investment and a shareholder in both Novo Nordisk and Eli Lilly, said the Danish company was still “lacking a vision for sustainable growth”. He is among investors hoping that Novo’s capital markets day in London on September 21 will provide greater clarity on its strategy and drug pipeline.
Doustdar maintains that the company’s prospects are being judged too narrowly through comparisons with Eli Lilly. “We haven’t lost it,” he said, insisting that Novo has a range of medicines in development and that the demand for obesity treatment will continue to grow.
For now, he says, the company needs time to prove its case. The success of the Wegovy pill may offer breathing space, but investors will ultimately judge Novo Nordisk on whether it can produce a successor capable of defending its position after semaglutide’s patent protection begins to fade.
