Novo Nordisk shares fall as weight loss drug fails to beat Eli Lilly

novo nordisk Shares fell more than 15% on Monday after the company announced it did not meet a key goal of showing its next-generation weight loss drug is as good as other products. Eli Lilly”It’s the latest blow to the Danish drugmaker, whose shares are trading at multi-year lows following a series of disappointing announcements.

The experimental drug, Kaglisema, failed to meet its primary endpoint of demonstrating non-inferiority in weight loss when compared to Eli Lilly’s rival drug tirzepatide after 84 weeks, Novo said in a statement Monday morning.

Tirzepatide is the active ingredient in Lilly’s blockbuster drugs Munjaro and Zepbound, which have overtaken Novo Nordisk’s semaglutide, sold by prescription in the U.S. as Ozempic and Wigovy.

Novo’s Copenhagen-listed shares last fell 16% to DKK 251, the lowest since June 2021.

Eli Lilly‘s stock price fell 4.7%. Lilly also launched a new format, Zepbound, on Monday that provides a month’s worth of doses in one pen.

Novo said patients who took 2.4 mg of Kaglisema achieved a 23% weight loss after 84 weeks, while patients who took 15 mg of tirzepatide achieved a 25.5% weight loss.

The study was a so-called open-label study, meaning participants knew what treatment they were receiving. Martin Horst Lange, Novo’s chief scientific officer, told CNBC’s Charlotte Reid that such a design could pose a risk of bias favoring well-known products when compared with investigational drugs.

There were some “slightly surprising results” for over-the-counter drugs, in this case tirzepatide, he added.

Lilly’s own research showed that tirzepatide reduced body weight by 20.2% over 72 weeks in people living with obesity or overweight.

Eli Lilly did not immediately respond to CNBC’s request for comment.

Novo applied for approval of Kaglisema from the U.S. Food and Drug Administration late last year, and a decision is expected by the end of 2026. The company has high hopes for the drug, which combines semaglutide with kagrylintide, another hormone released by the pancreas that affects appetite.

Despite Monday’s disappointing result, Novo CEO Mike Dusdahl remained optimistic about CagriSema’s potential.

“We strongly believe that CagriSema has better weight loss benefits than any product currently on the market at this time,” he said.

Novo is considering additional trials testing Kaglisema, including higher-dose combinations, the company said.

“Caglilintide has the potential to be the first GLP-1/Amylin combination product to market for people living with obesity, with Cagrilintide adding to the existing benefits of semaglutide and combining GLP-1 biology alone. “We have demonstrated that it provides a clinically meaningful additive weight-loss effect that is superior to that observed in patients with cancer,” Novo’s Lange said, adding that further trials will “evaluate the full weight-loss potential of Kaglisema.”

But Jefferies analyst Michael Leuchten said Kagisema’s failure to meet non-inferiority compared to Zepbound added further uncertainty, making the drug’s commercial position increasingly uncertain.

Kagrisema could account for 15% to 25% of Novo’s sales by 2030, “highlighting the urgent need for M&A,” Leuchten said, predicting Novo could spend up to $35 billion on M&A this year.

Monday’s trial results were another blow to the Danish drugmaker. This comes after the stock price fell by nearly 50% in 2025, falling short of drugs already on the market.

Earlier this month, Novo predicted sales and profit growth would fall between 5% and 13% in 2026 as it overcomes competition, lower prices in the U.S. and loss of exclusivity for Wigobee and Ozempic in certain markets.

“People should expect stocks to go down before they go up,” Novo’s Doesdahl told CNBC at the time.

Meanwhile, Lilly said it expects sales to increase by about 25% in 2026.

Novo got off to a strong start this year with the launch of Wegoby, the first GLP-1 weight-loss pill in the U.S., but Dusdahl said it wasn’t enough to offset challenges in other parts of the business. Eli Lilly plans to launch a competing drug in the second quarter of 2026.

In addition to competition from Lilly, Novo’s sales have been hurt by competition from compounding pharmacies that sell knockoffs of semaglutide at lower prices, in what Novo calls “illegal bulk compounding that poses a significant risk to patient safety.”

The FDA announced earlier this month that it plans to take legal action against telemedicine companies. him and herThis includes restricting access to ingredients and making a referral to the Department of Justice after Hims offered copies of Wigovy tablets at a price significantly lower than the price at which Novo’s branded tablets were sold. After receiving backlash, he quickly stopped taking the drug.