Novo Nordisk shares rise after approval of Wegovy to treat liver disease
Wegovy is first-in-class approved for the treatment of liver disease, but its exclusivity is threatened by US-based Eli Lilly
Shares in Denmark's Novo Nordisk rose after its weight-loss drug Wegovy was approved for use in the U.S. to treat a serious liver condition.
Pressure remains on the company due to competition from Eli Lilly, which is also developing drugs to treat metabolically associated steatohepatitis (known as MASH). Analysts expect their market entry is only a matter of time.
Details
Novo Nordisk shares rose nearly 6% in Copenhagen trading after U.S. regulator FDA approved its flagship obesity drug Wegovy to treat severe liver disease, Bloomberg writes. Novo Nordisk's American depositary receipts rose nearly 3% on the New York premarket on Aug. 18. Shares of its U.S. rival Eli Lilly fell more than 1% at the same time.
On August 15, the FDA approved the use of Wegovy injections for the treatment of metabolic associated steatohepatitis (known as MASH) in adults with moderate to severe liver fibrosis. This condition develops when fat accumulates in the liver, causing inflammation and potentially leading to more serious conditions such as cirrhosis and cancer.
What this means for Novo
The FDA's decision gives Novo Nordisk a much-needed extra boost in the fast-growing market for GLP-1 class drugs, which have become popular for their weight-loss effects, Bloomberg writes.
BMO Capital Markets analyst Evan David Seigerman said the approval of Wegovy for the MASH treatment could help the company "turn the tide after a more difficult start to the year." Novo has lost its status as Europe's most valuable public company this year, which it had earned through the popularity of its weight-loss drugs. Its shares have fallen nearly 40% since the start of the year amid slowing revenue growth and stiffer competition in the weight-loss drug market.
Wegovy became the first GLP-1 class therapy approved in the US for the treatment of the progressive liver disease MASH, which affects about 5% of US adults, Reuters writes. However, pressure is mounting on Novo: U.S. rival Eli Lilly has presented encouraging results from an interim study of a MASH treatment using tirzepatide, the active ingredient in its diabetes drug Mounjaro and weight-loss product Zepbound, Reuters notes.
"It is expected that [Wegovy's] exclusivity in the [MASH treatment] market will only last for a transitional period before Eli Lilly also brings the product to market," warned Nordnet analyst Per Hansen.
This article was AI-translated and verified by a human editor
