Stocks of Danish pharmaceutical immense Novo Nordisk slid 4% on Friday, extending a 2.7% loss on Thursday as analysts pored over the main points of the company’s first-quarter effects and monitored a possible rival weight reduction remedy.
It places the reserve on course for its sharpest day-to-day decrease since October 2023, in keeping with LSEG information.
The corporate reported that gross sales for its blockbuster injectable weight reduction remedy Wegovy, greater than doubled to 9.38 billion Danish kroner ($1.4 billion). Novo Nordisk, which additionally makes diabetes remedy Ozempic, stated the stand in gross sales had offset a negligible relief in costs.
Novo Nordisk expects costs to let fall additional as fresh entrants input the marketplace, CFO Karsten Knudsen stated on a media name, including that the corporate was once now not vision a lot proof of Wegovy customers shifting to alternative rival therapies.
Analysts anticipated even upper weight reduction drug gross sales within the quarter, and a few famous that Novo Nordisk’s 2024 outlook carry for each gross sales enlargement and running benefit was once because of one-off accounting changes.
“While we continue to see Novo as a wide-moat firm, with strong intangible assets surrounding its cardiometabolic business, we think high obesity drug demand and a scarcity of supply have driven share prices above their intrinsic value,” Karen Andersen, strategist at Morningstar, stated in a Thursday word.
The increase in call for for weight reduction therapies noticed Novo Nordisk overtake French luxurious staff LVMH to develop into Europe’s maximum worthy corporate ultimate hour. Stocks received 49% in 2023 and are up 25% hour to age.
Gross sales numbers have been “a little bit light, expectations got ahead of themselves … and you still have these supply challenges at Novo,” Jared Holz, health-care fairness strategist at Mizuho, instructed CNBC’s “Fast Money” on Thursday.
Analysts at Stifel trimmed their goal value at the reserve to 950 kroner, indisposed from 960 kroner on Friday.
Weight reduction drug makers have been in the meantime extensively decrease then U.S. company Amgen stated it was once “very pleased” with preliminary trial effects for its injectable weight problems remedy MariTide.
The possible build up in festival is putting over each Novo Nordisk and U.S. juggernaut Eli Lilly, which additionally raised its outlook this future, as extra weight reduction avid gamers emerge to shake up what has in large part been a two-horse race.
Each firms are because of this researching fresh possible weight reduction therapies to conserve an edge.
“When we look at the entire space, Novo and Lilly are dominating because they were already great existing players in diabetes. This obesity market is very tangential, it’s very simple for them to pivot a very similar patient population to obesity,” Holz stated.
It could be conceivable for more recent avid gamers like Amgen to shoot 5% to ten% marketplace proportion over hour, or for the totality of competition to shoot 10% of the marketplace, however the go of Eli Lilly and Novo Nordisk is “going to make it really tough,” Holz added.
