Novo Nordisk Faces Setback as Obesity Drug Falls Short of Expectations

Novo Nordisk's new obesity drug CagriSema underperformed in trials, leading to a significant market value drop. Investor and analyst reactions highlight concerns about its efficacy and tolerability compared to competitors. Despite setbacks, experts anticipate further trials to improve associated projections for the drug's future prospects.

Novo Nordisk has announced its experimental obesity drug, CagriSema, achieved only a 22.7% reduction in weight for patients during a late-stage trial, a figure that fell short of the company's 25% target. This news resulted in a substantial $125 billion decrease in the company's valuation.

Reactions from the investment community have been mixed. Markus Manns, a portfolio manager at Union Investment, described the results as the worst-case scenario for Novo Nordisk, noting that CagriSema's complexity surpasses that of Zepbound. Jefferies analysts also expressed disappointment over the 20.4% absolute weight loss and speculated on tolerability issues affecting patient adherence.

The situation has been compounded by the fact that only 57% of participants achieved the highest dose, sparking further concerns. Despite the negative press, DNB analyst Rune Majlund Dahl remains optimistic about future trials aimed at optimizing results. Alexander Jenke, another investor, emphasized that CagriSema's performance impacts Novo Nordisk's strategic outlook, particularly as it positions the drug as a Semaglutide successor.

(With inputs from agencies.)