Novo Nordisk Stock Down on Rival's Weight Loss Pill Approval

Novo Nordisk stock fell 2.59% on Tuesday due to rival Eli Lilly's announcement of positive results for its weight loss pill, orforglipron. Novo Nordisk's Wegovy, a popular weight loss medication, is only available via injection and a pill version is still awaiting approval. The two companies are vying for approval from the FDA to reach a larger patient base. Analysts' consensus rating for Novo Nordisk is Moderate Buy with an average price target of $67.86, representing a 23.65% upside.

Eli Lilly (LLY) announced on Tuesday that its investigational weight-loss pill, orforglipron, achieved significant results in a Phase 3 trial, setting the stage for global regulatory submissions. The drug demonstrated "significant" weight loss and "meaningful" reductions in average blood sugar levels, or A1C, meeting primary and key secondary endpoints after 72 weeks [1].

At the highest dose of 36 milligrams, participants lost an average of 22.9 pounds, representing a 10.5% reduction in body weight compared to a 2.2% drop among those who took a placebo. This positive data has prompted Eli Lilly to accelerate its regulatory submission process to meet the needs of patients awaiting treatment [1].

Eli Lilly's stock surged 4.6% on Tuesday, reflecting investor optimism following the trial results. The company is positioned to offer a convenient, once-daily oral treatment that can be scaled globally, potentially redefining how obesity is treated worldwide [1].

Novo Nordisk (NVO), a rival in the weight-loss market, saw its stock fall 2.59% on Tuesday. Novo Nordisk's Wegovy, currently available via injection, is awaiting approval for a pill version. The competition from Eli Lilly's orforglipron could impact Novo Nordisk's market share and patient base [1].

Analysts' consensus rating for Novo Nordisk remains a Moderate Buy with an average price target of $67.86, representing a 23.65% upside [2]. The approval of Eli Lilly's oral weight-loss pill could create a more segmented obesity market, driven by patient characteristics, weight loss needs, and tolerance to specific therapies [1].

References:
[1] https://finance.yahoo.com/news/eli-lilly-apos-latest-weight-164720886.html
[2] https://seekingalpha.com/news/4489112-eli-lilly-posts-phase-3-trial-win-obesity-pill