Novo Nordisk shares drop after poor trial results for new obesity drug

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Disappointing results for Novo Nordisk’s new obesity treatment caused a sharp fall in its shares on Monday, dealing a fresh blow to the embattled Danish drugmaker.

CagriSema, Novo’s new once-weekly injection, delivered an average weight loss of 23 per cent after 84 weeks, compared with 25.5 per cent for tirzepatide, the active ingredient in Eli Lilly’s blockbuster drugs Mounjaro and Zepbound.

Novo’s shares fell more than 15 per cent following the news.

Its latest obesity drug contains a new molecule, cagrilintide, as well as semaglutide, the active ingredient in its blockbuster drugs Ozempic and Wegovy.

The results from the late-stage trial put further pressure on Novo, which has fallen behind Lilly in the key US market.

This month, Novo, once Europe’s largest company by market capitalisation, announced that it expected net sales and profits to fall as much as 13 per cent this year, partly blaming falling US prices associated with a deal with the Trump administration to cut drug costs for consumers.

It also faces patent expiries for Wegovy and Ozempic this year in markets such as Canada, Brazil, India and China, as well as fierce competition from cheaper copycat versions in the US.

Novo’s chief executive Mike Doustdar, who has been in the job since August, has described the price cuts in the US as painful.

Novo’s shares have almost halved over the past 12 months and trade two-thirds below their peak of June 2024.

Novo submitted CagriSema to the US Food and Drug Administration for approval in December based on earlier trial results and a decision is expected later this year.