RESOLVING THE LEDGER
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Topline Novo Nordisk shares plunged on Friday, erasing more than $30 billion in market value after the Danish drugmaker said a late-stage experimental drug failed in a large study, drawing criticism from analysts who said the firm missed an opportunity to expand beyond its weight-loss offerings.
Novo Nordisk reported Friday its ziltivekimab “did not achieve” goals to reduce major adverse cardiovascular events like a heart attack or stroke in a late-stage clinical trial, and it did not disclose how much the drug reduced risks.
Jeffries analysts wrote in a note that ziltivekimab would have needed to show at least a 20% risk reduction, and the trial results were “strategically negative” as they effectively erased a growth opportunity for Novo Nordisk’s business beyond its Ozempic and Wegovy market that could have been worth more than $10 billion annually.
Goldman Sachs analysts praised the drug’s potential ahead of the trial results, writing ziltivekimab could have been the foundation for Novo Nordisk to build a franchise in cardiovascular disease care and relieve potential risks to sales, which are largely reliant on Ozempic and Wegovy.
$30.7 billion. That’s how much was cut from Novo Nordisk’s market capitalization as of Friday’s share price, lowering from $229.2 billion to $198.5 billion, marking a nearly 69% decline since hitting an all-time high of $635.7 billion in June 2024.
Novo Nordisk, despite the success of its Ozempic and Wegovy drugs in recent years, has worked to expand on its other businesses to bolster sales. The firm has moved to increase the GLP-1 market by expanding into pill versions of its medications, and Novo Nordisk has since launched a Wegovy pill in the United Arab Emirates and the U.K., with plans to sell in the U.S. and globally.
Novo Nordisk clashed with Eli Lilly earlier this month, accusing the rival GLP-1 manufacturer of “deceptive” advertising that Novo Nordisk said relied on outdated data to make its products look less effective. The Ozempic maker said it looked to resolve the dispute out of court, but “Lilly refused, calling its advertising ‘truthful’ and ‘transparent,’” according to court documents. The motion also asks the court to require Lilly to issue corrective advertising that indicates its ad campaigns had “planted false beliefs in consumers’ minds.”
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