Novo Nordisk Plunges 3.03% on Disappointing Obesity Drug Trial

On March 24, 2025, Novo Nordisk's stock experienced a 3.03% decline in pre-market trading.

Novo Nordisk's latest trial results for its next-generation obesity drug, CagriSema, have disappointed investors. The drug, a combination of cagrilintide and semaglutide, failed to demonstrate superior efficacy compared to existing treatments. The REDEFINE-2 trial showed that CagriSema helped patients with type 2 diabetes achieve a weight loss of 15.7% over 68 weeks, falling short of the anticipated weight loss of over 15%. An earlier trial also missed expectations, showing a 22.7% weight reduction in patients with obesity-related complications.

These disappointing results have led to a significant drop in Novo Nordisk's stock, which has fallen about 50% from its 2024 peak. Industry analysts have expressed concern over the trial results, with some U.S. hedge funds shorting the stock due to the disappointing outcomes and concerns over high valuations in the weight-loss drug sector. Despite these setbacks, Novo Nordisk remains optimistic about future trials. The upcoming REDEFINE-4 study, expected to release results in early 2026, may provide more insights into the drug's long-term efficacy and flexible dosing. Analysts believe this could potentially differentiate CagriSema in the competitive market.

The weight-loss drug industry continues to face debates over broader applications and effects beyond weight reduction. Other pharmaceutical companies are also eyeing this lucrative market, which is projected to exceed $100 billion by 2030. While Novo Nordisk aims to submit a regulatory approval application for CagriSema in the first quarter of 2026, the company faces challenges in regaining investor confidence. Analysts suggest that it may eventually be considered a viable alternative to existing blockbuster drugs.