Billions were wiped off the value of Ozempic-maker Novo Nordisk yesterday after a promising drug trial by a US rival.
The Danish pharma giant’s shares fell by up to 9 per cent yesterday, the first trading day since Eli Lilly announced that its experimental daily pill may work just as well as fat jabs.
Although the group clung on to its title as Europe’s second-largest company, it shed £10billion as shares closed down 7.4 per cent, leaving it worth £151billion.
Naresh Chouhan, an analyst at Intron Health, said Eli Lilly could be ‘set to transform’ the weight-loss industry.
Eli Lilly said last week that Orforglipron was just as effective in lowering blood sugar and aiding weight loss in patients with type-2 diabetes as jabs such as Ozempic.
The group hopes to receive approval from the US Food and Drug Administration to sell the pill for obesity this year and for diabetes next year.
Rival: Danish pharma giant Novo Nordisk’s shares fell by up to 9% yesterday, the first trading day since Eli Lilly announced that its experimental daily pill may work just as well as fat jabs
Investors appeared to view it as a setback for Novo, whose valuation has soared over the past few years due to demand for drugs including Wegovy and Ozempic.
Wegovy is taken as a weekly injection and tricks the body into thinking it is full. It is available on the NHS. Sister drug Ozempic, which has the same key ingredient, has taken off in the US.
But drug makers have been racing to test similar products that can be taken as a pill, which people generally prefer to injecting themselves.
It would also be a more convenient option as it does not have to be refrigerated. Competition has seen Novo Nordisk lose more than half of its value over the past six months.
The group has also been hit with supply chain difficulties as demand for the drug has soared. But analysts say the Danish pharma business still has a strong hand.
Novo Nordisk already has a pill Rybelsus on the market for diabetes. It is hoping to be given approval to market a similar treatment for weight loss, too.
Derren Nathan, head of equity research at Hargreaves Lansdown, said: ‘While Novo’s treatment has some drawbacks compared to Lilly’s pill, it’s still in the game with two more trials aimed at expanding its use.
‘For now, with Lilly’s pill still awaiting approval, Novo holds an edge as the first to market.’
Eli Lilly shares, which trade in New York, rose 14 per cent on Thursday last week, adding £75billion to its valuation.
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