Novo Nordisk's Semaglutide Trials for Alzheimer's Could Add $150B in Sales

This autumn, Novo Nordisk is set to unveil the results of its clinical trials for the GLP-1 drug semaglutide in the treatment of Alzheimer's disease. Analysts estimate the probability of success to be only one in ten, but if successful, the company could see an additional 150 billion dollars in annual sales. For Novo Nordisk, which is facing slowing growth, the outcome of this investment is crucial. The company's stock has fallen by more than 58% in the past 12 months, far exceeding the 23% decline of Eli Lilly.

Since its introduction seven years ago, Novo Nordisk's GLP-1 drug semaglutide has expanded its applications from obesity and diabetes to heart disease and liver disease. Currently, the company is testing its efficacy against Alzheimer's disease. The research is based on an unexpected discovery from Danish health registry data, which showed that diabetic patients using Novo Nordisk's previous generation GLP-1 drug Victoza or similar medications had a 20% lower risk of developing dementia compared to those using other treatments. This finding prompted Novo Nordisk to launch large-scale clinical trials for Alzheimer's disease.

The chief scientific officer of Novo Nordisk expressed excitement about the potential but also acknowledged the high risk involved. The company has already lowered its growth forecasts twice this year, facing competition from cheaper generic drugs and more potent products from Eli Lilly in the GLP-1 market. Despite the stock decline, analysts believe that academic research into GLP-1 drugs for Alzheimer's disease will continue, even if Novo Nordisk's study fails.

Current approved Alzheimer's drugs primarily target amyloid proteins, which are toxic misfolded proteins that accumulate in the brains of patients. Semaglutide, however, works differently by mimicking a gut hormone called GLP-1. Researchers believe it may reduce inflammation and alter brain glucose metabolism. Multiple studies have shown that diabetic patients are more likely to develop dementia, providing a reasonable explanation for the link between the two conditions. If the trials are successful, semaglutide could become one of the first anti-aging drugs.

Despite the promising outlook, Alzheimer's disease remains a challenging area for drug development, with numerous studies ending in failure. The trial design itself presents challenges. Conducting preventive trials in healthy volunteers is costly and operationally complex. Therefore, Novo Nordisk is testing the drug in mild patients who have been diagnosed with amyloid proteins in their brains to see if it can slow the progression of the disease. Even if the results show only minor benefits, some people might start using semaglutide as a preventive measure.

Currently approved Alzheimer's drugs, such as those from Eisai and Eli Lilly, work by clearing toxic β-amyloid plaques from the brain to slow disease progression, but their effects are limited and come with serious risks such as brain hemorrhage. The outcome of Novo Nordisk's trials will be closely watched, as a successful result could revolutionize the treatment of Alzheimer's disease.