Novo shares plummeted on Monday after the company’s new long-term goals failed to ease investor concerns about its ability to compete in the increasingly crowded weight loss market it helped pioneer.
The Danish drugmaker said it aims to launch more than five drugs with «multi-blockbuster» potential by 2030 and generate more than 150 billion Danish kroner ($23 billion) in risk-adjusted pipeline sales by 2035, including current assets.
It also expects revenue growth between 2026 and 2030 to be in line with industry peers such as Eli Lilly, AstraZeneca, Amgen, Biogen, Merck, AbbVie, and Novartis.
Copenhagen-listed shares were down 8.1% in afternoon trading, on track for their worst day since February.
«Investors hoped for a project ‘miracle’ that could turn the momentum around short term,» Per Hansen, savings economist at Nordnet, told CNBC. «For obvious reasons that miracle does not exist.»
‘The elephant in the room’
CEO Mike Doustdar told investors at the company’s Capital Markets Day in London that the «elephant in the room» was that semaglutide, the active ingredient in weight-loss and diabetes medicines Wegovy and Ozempic, will lose key patent exclusivity starting early next decade. The semaglutide patent expires in 2032 in the U.S., a market that accounted for more than half of Novo’s overall sales last year.
This loss of exclusivity «is what’s on most people’s mind, and rightfully so,» Doustdar said.
«We created an incredibly attractive market, and now almost every other single pharma company, big or small, is trying to come and compete with us. We need to be ready for that,» he added.
Doustdar also laid out plans to diversify the company, adding that the company did not «belittle» the loss of exclusivity «or the challenges that comes with it, related to the price pressure.»
«We plan to come on the other side of the LOE as a bigger company than we are today and a much more diversified version of it,» he said.
Eli Lilly shares have far outperformed Novo ADRs over the past year.
Ahead of the opening bell on Monday, Novo shares had fallen 27% over the past 12 months, while its chief rival Eli Lilly shares have gained 52% over the same period.
Lilly has managed to grab a majority market share in the injectable GLP-1 space with Mounjaro and Zepbound, despite launching years after Novo’s drugs.
While Novo’s launched its Wegovy pill in the U.S. at the beginning of this year to great success, investors are still cautious around the drugmaker’s prospects of regaining ground. It has begun to roll out the Wegovy pill in other markets as well, but it still represents a small portion of its total sales.
A series of clinical setbacks and leadership upheavals over the past year has added to investors’ concerns.
Last week, Novo said it is rebranding from Novo Nordisk to Novo and updating its corporate culture. Doustdar told CNBC the rebrand and culture revamp were «parts of the same package» to meet fierce competition from Lilly.
Investors wanted more
Even as Novo indicates stable operating margins, Monday’s announcement lacks the financial ambition the market wanted to see, Jacob Pedersen, investment strategist at Danish bank Middelfart Sparekasse, told CNBC.
«The investors, they are very particular in what they want from Novo, and this doesn’t add up to it,» Pedersen said, adding that Novo’s target for growth in line with a broad group of pharma peers suggests slower growth than investors have historically come to expect from the company.
In August, Novo said it expects adjusted sales and operating profit to both be down 6% to flat in 2026, at constant exchange rates.
Analysts and investors have had mixed views on whether Novo should broaden its portfolio significantly, or focus on its existing therapy areas.
«It hasn’t been long since the company wanted to focus more, and now they want to broaden out,» Pedersen said.
The push to diversify marks a shift in the strategy Doustdar laid out after taking over as CEO last year, when Novo sharpened its focus on its core obesity and diabetes businesses and moved away from expanding into new areas.
Novo said Monday it is now moving beyond its core areas of obesity and diabetes. Doustdar said those remain Novo’s foundation, but that the company now wants to build out its portfolio around blood and endocrine disorders, liver disease, and cardiovascular disease.
He also said Novo will be more active in business development, which was not included in the 2030 sales target.
– CNBC’s Charlotte Reed and Mike Considine contributed to this report.
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