Novo Nordisk is betting on a CEO shake-up to regain its weight loss drug edge over Eli Lilly

Novo Nordisk Is banking on new leadership to help it reclaim the crown in the flowering drug market for weight loss.

The Danish drug maker abruptly announced on Friday that the old CEO Lars Fruergaard joins Jørgensen, while the Obesity injection Wegovy loses the ground to Eli LillyThe rival treatment, Zepbound. While Eli Lilly came on the market later, it is on the rise as the leader in a room that, according to some analysts, could be worth more than $ 150 billion in the early 2030s.

The new top manager of Novo Nordisk will have to help the company close the gap with Eli Lilly, to ward off rivals and navigate other challenges. The following CEO will have to lead the company's plans to launch a new series of drugs for weight loss before important patents for Wegovy expire, and manage the impact of Medicare drug price negotiations and the planned rates of President Donald Trump on pharmaceuticals.

It is unclear who will take the place of Jørgensen, but the company said it is considering both internal and external candidates.

“While Novo [Nordisk] Took an impressive early lead in the obesity duopoly, they gave the ground at a criticism when more competitors are approaching quickly, “said BMO Capital Markets analyst Evan Seigman in a note on Friday, referring to other drugstores racing to bring their own obesity treatments on the market.

Novo Nordisk once had the title of Europe's most valuable company – worth $ 615 billion at its peak – driven by the enveloping demand for Wegovy and his diabetes opposite, Ozempic.

But the enthusiasm of investors is blurred after Eli Lilly has obtained a larger part of the market and clinical test data about the next wave of obesity medicines from Novo Nordisk impressed by investors. Shares of Novo Nordisk have been deposited more than 50% in the past year and have wiped out more than $ 300 billion in market value.

The shares of Novo Nordisk have still risen more than 250% since Jørgensen took over CEO in January 2017. But shares of Eli Lilly have won around 800% since the same month, when CEO Dave Ricks took over the company.

The increasing pressure also came from the powerful Novo Nordisk Foundation, the controlling shareholder of the Danish drug maker. The foundation recently urged the leadership of Novo Nordisk to consider an “accelerated CEO follow -up” and insisted on a greater representation of the council, according to a statement on Friday.

Novo Nordisk said on Friday that together with Jørgensen concluded that it was time to find a new CEO after the foundation's request, recent market challenges and the steep decrease in the company's share price. Jørgensen said he did not see his expulsion coming and was only recently informed, according to various reports on Friday.

Days before the announcement, Novo Nordisk lowered its sales and profit forecast for the first time since the launch of Wegovy four years ago.

Seigerman said it is still unclear whether a new top management will be able to take on the challenges of the company.

“Although for some it could satisfy for investors to stimulate a CEO transition, without a meaningful change in the strategy in the short term, we will continue to see a more difficult path ahead,” he said.

Novo Nordisk has given the market share to Eli Lilly, although Zepbound's dollar sale still follows Wegovy's.

The Diabetes medicine from Zepbound and Eli Lilly now declare more than half of the American recipes for so-called GLP-1's, which mimic hormones to stamp the appetite and the blood sugar level, according to a separate Noot from Seigman earlier this month.

This exceeds the combined share of 46% of Novo Nordisk's Wegovy and Ozempic.

New American recipes from Zepbound surpassed that for Wegovy for the first time at the beginning of March 2024, just a few months after the launch of Eli Lilly's medicine, Reuters reported at the time. By August, some analysts estimate that Zepbound had conquered 40% of the American weight loss market, hot on the heels of Wegovy.

That “traction for market share clearly shows that doctors and patients prefer Zepbound” above Wegovy, Bernstein Analyst Courtney Breen wrote in a note at the beginning of May. Data from practice and a clinical study of the head have shown that Zepbound leads to more weight loss than Wegovy.

Novo Nordisk also has difficulty convincing Wall Street that the pipeline of the next generation of drugs for weight loss can help maintain its position in the market, especially after Wegovy loses exclusivity and can sell medicine makers cheaper generic alternatives.

Novo Nordisk, for example, said repeatedly told that investors are the shot of Cagrisema, which was expected to be launched in 2026, to help people lose 25% or more of their body weight. But the one -off drugs that did not suffice in December 2024 in December 2024, causing the shares of the company to fall.

The company said in April that it applied for the American approval of an oral version of Semaglutide, the active ingredient in Wegovy and Ozempic. It comes as drug makers to hurry to develop more convenient pills for weight loss, which, according to some analyst estimates, can make $ 50 billion of the market.

But Seigerman said in April in a separate memorandum in April, Novo Nordisk has no clear strategy for his portfolio of the oral obesity. He said that this will “probably dispute the growth at the end of the decade”, especially since Eli Lilly's own obesity pill impresses investors and centimeters closer to entering the market.

Unlike oral semaglutide, Eli Lilly's pill is a small molecule medicine and no peptide medication. That means that Eli Lilly's medicine is more easily absorbed in the body and does not need dietary restrictions such as oral semaglutide, which can be a remarkable advantage for the company.

Seigerman acknowledged that the experimental small molecule pill from Novo Nordisk, Amycretin, could be competitive in the long term. But he said that will not happen soon, because the medicine is not expected to launch for several years.

Outside of pipeline issues, Novo Nordisk and the rest of the pharmaceutical industry struggles with the ambitions of the Trump administration to reduce drug prices and bring production to the American Trump, has said that he intends to impose rates on the drugs that have been impressed in the US. Prices to bind.

Novo Nordisk made it clear that his strategy remains unchanged despite the abrupt exit of Jørgensen.

“We have a strong product portfolio with a lot of potential,” said Novo Nordisk Board chairman Helge Lund on a phone call with analysts Friday. “We have an experienced executive team to continue to evolve and help the company move forward with a long -term perspective.”

But Seigman said that the decision to exchange CEOs seems to “draw attention to pivot points in this strategy that may be needed.”

According to Seigman, investors have already seen potential signs of that shift.

Novo Nordisk has long given priority to peptide-based therapeutics. But the recent deal of the company indicates that it is “heavier on oral solutions for small molecules for the obesity market,” said Seigman.

The company announced a license deal last week with the American biotech company Septerna for experimental pills with small molecules for obesity and other cardiometabolic diseases.

But those pills are in early development and those products are years after entering the market, which means that the agreement is still risky.

The same can be said of various other recent Nordisk tie-ups.

Novo Nordisk said in March that it had agreed to pay up to $ 2 billion for the rights to an early experimental medicine of the Chinese pharmaceutical company United Laboratories International.

The newly acquired medicine is a clear potential competitor of Eli Lilly's so-called triple G Obesitas-Medicijn Retatrutide because they both use a tribute approach to promote weight loss and regulate blood sugar levels. But Retatrutide is in late clinical tests, which means it can come in the market years before the Novo Nordisk medicine does.