Novo Nordisk shares jump after US approves Wegovy pill

By Stine Jacobsen and Bhanvi Satija

Dec 23 (Reuters) – Novo Nordisk shares jumped 10% on Tuesday after the U.S. Food and Drug Administration approved its weight-loss pill, giving the Danish drugmaker a competitive edge over rival Eli Lilly in the fast-evolving market for obesity drugs.

The approval of Novo’s Wegovy pill gives the drugmaker a first-mover advantage in the race for a potent oral weight-loss medicine, as it tries to claw back market share from Lilly and compounding manufacturers.

Shares of the company rose to 335.60 Danish crowns, set for biggest one-day gain since August 2023.

Novo, which faced massive supply challenges after the 2021 launch of its injectable drug Wegovy, has said it is better prepared this time. CEO Mike Doustdar said last month that the company has “more than enough pills this time” and would go “all in” on the launch.

Its shares, which have fallen by more than half this year, were Tuesday’s biggest gainers in Europe.

U.S.-listed shares of Novo rose about 9% to $52.42 in early trading. Lilly’s shares were flat in volatile trading.

Novo has also submitted a marketing application for the pill to the European Medicines Agency and other regulatory authorities.

PILLS – THE NEW BATTLEGROUND

While Wall Street remains upbeat about the Wegovy pill, the focus is also on how the treatment would fare against Lilly’s oral drug.

BMO Capital analyst Evan Seigerman said Novo’s advantage in capturing patients with a preference for the convenience of a pill could be short-lived, with Lilly’s orforglipron expected to be approved in 2026.

Novo stole a march on Lilly when it launched the injectable version of Wegovy, but struggled to meet demand. Lilly then forged ahead with its Zepbound injection, which has largely been ahead of Wegovy in weekly U.S. prescriptions this year. Novo already sells Rybelsus, an oral semaglutide for type 2 diabetes.

Roche, AstraZeneca and U.S. based Viking Therapeutics and Structure are among those also testing oral weight-loss drugs.

EXPANDING MARKET

Analysts expect pills to expand access to weight-loss treatments and address injection hesitancy.

“Our focus is rather simple. Effective treatments and broad affordable access whether patients prefer a pill or an injection,” Novo CEO Doustdar said in a video posted on LinkedIn.

Paul Major, portfolio manager at Bellevue Asset Management, said 10% or more of adults are hesitant to self-inject but questioned the transformative potential of the pills, as they are less efficacious than injections. 

Sydbank analyst Soren Lontoft Hansen estimates global peak annual sales of around 24 billion Danish crowns ($3.79 billion) for the Wegovy pill, with a strong launch key to Novo offsetting some headwinds in 2026, including price declines for its popular GLP-1 drugs, Ozempic and the Wegovy injection.

Under a November deal with the Trump administration, Novo and Lilly agreed to sell starter doses of their weight‑loss pills, if approved, for $149 a month to U.S. Medicare and Medicaid patients and cash-paying customers who cannot get insurance coverage for the medications.

($1 = 6.3391 Danish crowns) ​

(Reporting by Danilo Masoni, Stine Jacobsen, Bhanvi Satija and Maggie Fick, additional reporting by Sriparna Roy in BengaluruEditing by David Goodman, Kirsten Donovan)