Trump's Comments on Ozempic Send Shares of Novo Nordisk and Eli Lilly Plummeting

Novo Nordisk and Eli Lilly shares plummeted after President Trump said Ozempic's cost should be "much lower." Trump's comments were made during an Oval Office news conference, but the negotiations with Novo Nordisk are still ongoing. Medicare is already in talks to lower prices for Ozempic and its sister drug, Wegovy, under the Inflation Reduction Act. The deadline for these negotiations is Nov. 1, with lower prices set to take effect in 2027.

Novo Nordisk and Eli Lilly shares dropped sharply on Thursday following comments from US President Donald Trump about potential reductions in the prices of weight-loss drugs. During a White House event focused on fertility treatments and drug pricing, Trump suggested that the cost of drugs like Novo Nordisk’s Ozempic (semaglutide), used for diabetes and weight management, would soon be "much lower." He stated that the cost could be reduced to about $150 per month, down from approximately $1,000.

Before Friday’s opening bell, shares of both Novo Nordisk (NYSE:NVO) and Eli Lilly and Co (NYSE:LLY) were down more than 4%. Analysts at Deutsche Bank see Eli Lilly as best positioned should weight loss drug pricing does end up being $150 per month. They noted that it was unclear if this would be under the Trump administration’s Most Favored Nation (MFN) policy or the Inflation Reduction Act.

The analysts wrote that the press conference signalled this would be via MFN, with the question then becoming which company has the ability to leverage weight loss volume and marketing. "In our view, that winner is Eli Lilly given orforglipron is a small molecule that's amenable to high volume and does not require cold chain storage," "Oral semaglutide at 25mg removes the need for auto-injector, but 25mg of API is approximately 10x step-up versus semaglutide's max injectable dose and to us does not seem as scalable as orforglipron.”

Investor concerns about potential revenue impacts for the two pharmaceutical giants that dominate the rapidly growing weight loss and diabetes drug market were triggered by the comments. Both companies have seen substantial growth driven by their GLP-1 medications, which include Novo Nordisk’s Ozempic and Wegovy, and Eli Lilly’s Mounjaro and Zepbound.

Novo Nordisk Pharma and Sumitomo Pharma have entered into a co-promotion agreement in Japan for Wegovy® Subcutaneous Injection, a once-weekly subcutaneous injection formulation of GLP-1 receptor agonist indicated for the treatment of obesity disease. Wegovy® has been marketed since February 22, 2024, by Novo Nordisk Pharma in Japan.

The comments from Trump come as Medicare is already in talks to lower prices for Ozempic and its sister drug, Wegovy, under the Inflation Reduction Act. The deadline for these negotiations is November 1, with lower prices set to take effect in 2027.