First obesity pill: US approves Novo drug, how will the market react?

Denmark's Novo Nordisk has received US marketing authorization for Wegovy tablets, the first-ever oral obesity drug based on the GLP-1 hormone, which was previously the basis for best-selling weight-loss injections. That will give Novo a slight head start over pharma giant Eli Lilly, which has been wresting the injectable market from it. The company's U.S.-traded depositary receipts jumped in value overnight, which is likely to send Novo shares surging after trading opens in the Danish capital.

Novo Nordisk will launch a weight loss pill for sale in the U.S. in early January, the company said on the night of Dec. 23 after the close of major trading on New York stock exchanges. U.S. regulators have approved its drug for both weight loss and long-term maintenance. Novo also said it has filed for approval of its pill in Europe and other parts of the world in the second half of 2025.

Novo Nordisk's American Depositary Receipts (ADRs) jumped in price by 10% in the New York aftermarket. This increase was maintained in over-the-counter trading as well. The Copenhagen Stock Exchange, where the company's shares are traded, will open at 9 a.m. local time (1 p.m. Astana time). In 2025 Novo quotations collapsed twice amid growing doubts of investors in the company's ability to hold positions in the market.

Developing an obesity pill is key for Novo in its competition with Eli Lilly. Novo now has a few months head start - Eli Lilly expects its pill to be approved in the U.S. by March 2026, Bloomberg notes. Novo's flagship injectable, Wegovy, has lost ground to Lilly's Zepbound, which helps you lose weight faster. And the Danish company's new product, CagriSema, didn't provide as much weight loss as promised in studies.

According to U.S. authorities, about 40% of U.S. adults are obese, but only one in eight (12%) are taking GLP-1-based drugs. Novo was a pioneer in the injectable segment, but now Eli Lilly leads in sales in the U.S. market, Reuters writes. Tablets, with their obvious advantages - convenient to take on the go and no need to keep in the fridge - could take about a fifth of the market by 2030, the agency said.

Optimism prevails among stock analysts regarding Novo Nordisk shares. Consensus on its securities is "above the market" (Outperform). According to MarketScreener, the majority of experts (12) recommend shares of the Danish company to buy, seven take a wait-and-see position (Hold, recommendation not to buy or sell shares), and only two advise to sell. The current average target price of DKK 393 per share ($63) implies a potential upside of 29.5% over the horizon of a year.

This article was AI-translated and verified by a human editor