Novo Nordisk Slumps to Near 52-Week Low—What's Driving the Plunge?

• NVO plummets 3.04% to $68.85, nearing its 52-week low of $57.00.
• Competitor Eli Lilly (LLY) surges on Mounjaro demand, contrasting NVO’s struggles.
• Italian factory expansion boosts long-term capacity but fails to offset near-term concerns.
• $1.3 billion market cap erased as shares test 200-day moving average support.

Today’s selloff marks a critical test for Novo’s obesity drug dominance amid intensifying competition and generic threats, with the stock trading within striking distance of multi-year lows.

Intensified GLP-1 Rivalry and Generic Threats Undermine Momentum
The sell-off reflects escalating pressure from Eli Lilly’s Mounjaro and Zepbound, which now account for nearly half of LLY’s revenue, while Novo’s Wegovy faces generic competition in India post-patent expiry. Supply chain uncertainties persist despite resolved U.S. shortages, and delayed data from amycretin’s Phase 3 trial amplify investor caution. Analysts downgrade 2025 sales growth projections, amplifying profit-taking ahead of Q2 earnings.

Pharma Sector Mixed as Lilly Outshines in Obesity Drug Race
While Novo struggles, sector leader Eli Lilly (LLY +0.8%) capitalizes on surging obesity drug demand. LLY’s broader pipeline momentum and geographic diversification contrast with NVO’s reliance on GLP-1 drugs, leaving it vulnerable to pricing pressures and patent cliffs. The sector’s mixed performance highlights structural shifts, with gene therapy setbacks (Pfizer’s Beqvez discontinuation) underscoring Novo’s resilience in diabetes/obesity therapies.

Bearish Plays Dominate—Top Put and Call Contracts for NVO’s Volatility
• Bollinger Bands: Current price ($68.85) near lower band ($63.67), signaling oversold conditions.
• RSI: 39.00 (deep undervalued territory).
• MACD: Negative crossover (-0.49 vs -0.27 signal line) confirms bearish momentum.
• 200-Day MA: $72.25—key resistance level.

Aggressive bears target NVO20250718P68 (Put) with a strike near current price. This contract offers 74.76% leverage, delta -0.3917, gamma 0.1186, and strong turnover (43,946 shares). A 5% drop to $65.41 delivers ~$3.44 profit per contract. For contrarians, NVO20250718C65 (Call) provides delta 0.8668, gamma 0.0596, and 109,573 shares traded—ideal for a rebound to $72.01 (200-day MA).

Hook: “Short NVO20250718P68 until resistance at $72.25 holds—bearish momentum remains intact.”

Backtest Novo Nordisk Stock Performance
The backtest of Novo Nordisk's (NVO) performance after an intraday plunge of at least -3% shows favorable short-to-medium-term gains. The 3-Day win rate is 57.29%, the 10-Day win rate is 60.38%, and the 30-Day win rate is 60.38%, indicating a higher probability of positive returns in the immediate aftermath of such events. The maximum return during the backtest period was 4.46%, suggesting that while the stock may experience volatility, it has the potential for recovery and even gains following significant dips.

Watch for Support Breaks—NVO’s Critical Technical and Catalyst Crossroads
The $63.67 Bollinger Band and $72.25 200-day MA define near-term battlegrounds. Bulls need a sustained close above $70 to reverse the downtrend, while a breach below $63.67 could trigger deeper declines. Long-term, the $2.3 billion Italian factory and amycretin’s Phase 3 data (early 2026) offer hope, but near-term risks—generic erosion and LLY’s pipeline—remain pressing. Investors should monitor LLY’s performance as a sector benchmark and prepare for volatility ahead of Q2 earnings. Action Insight: “Bulls target $72 reclamation; bears aim for $65 breakdown—options offer asymmetric risk/reward.”