Novo Will Sue Investors Over the Results of a Study on a Weight-Loss Drug

On Tuesday, July 28, a U.S. court allowed a lawsuit against Danish pharmaceutical giant Novo Nordisk to proceed, alleging possible misrepresentation of clinical trial data for the weight-loss drug CagriSema, according to CNBC. Novo’s shareholders filed the lawsuit against the pharmaceutical company: They allege that the company misled investors regarding a key clinical development study before releasing disappointing results, which ultimately led to a drop in Novo’s market value by billions of dollars.

A class-action lawsuit filed in January 2025 on behalf of investors who purchased Novo Nordisk stock between November 2022 and December 2024 relates to CagriSema, an experimental injectable weight-loss drug. It combines semaglutide—the active ingredient in Wegovy and Ozempic—with cagrilintide, which mimics the hormone amylin.

When Novo released the key results of the CagriSema trial, known as REDEFINE 1, in December 2024, investors had expected the drug to deliver an average weight loss of approximately 25%. However, the company instead reported an actual average weight loss of 20.4%, which led to a sharp drop in its stock price in December 2024—a 17.83% decline. Novo’s stock price on the Copenhagen Stock Exchange fell by 20.7%, and the company lost billions of dollars in market capitalization overall.

Investors are accusing the pharmaceutical giant of failing to warn the market about the flexible dosing regimen in the REDEFINE-1 study, which allowed trial participants to adjust their doses during the trial rather than requiring everyone to switch to the maximum dose. As a result, study participants recorded an average weight loss of 20.4% after taking the drug—instead of the 25% expected by the market, according to CNBC. Investors believe this data distorted the market’s perception of the trial results, particularly regarding how patients tolerate the maximum dose of the drug. This distinction matters: the court noted that patients’ ability to continue treatment at the prescribed dosage is a key issue for obesity drugs.

“Clinical trials are complex and full of nuances, and investor calls are by no means scientific conferences,” Judge Robert Kirsch noted in his ruling. He also emphasized that pharmaceutical companies are not permitted to distort or conceal key details of trials in a way that could be misleading.

The judge dismissed most of the shareholders’ allegations, ruling that the investors had not sufficiently substantiated the validity of their claims regarding many of the company’s statements about CagriSema’s weight-loss potential, future trials, or other issues under securities law. However, he allowed the claims regarding CagriSema’s tolerability and the clinical protocols for the REDEFINE-1 study to proceed.

Novo denies all allegations.

The pharmaceutical giant's shares rose 0.8% in trading in Copenhagen; they are up 4% year-to-date.

The company has effectively shaped the modern market for anti-obesity drugs with Wegovy and Ozempic, but it is facing growing pressure from competing drugs from Eli Lilly, which are rapidly gaining market share, CNBC notes. Because of this competition, Novo’s pipeline is becoming increasingly important to investors. To strengthen its market position, the company is counting on products such as a higher-dose version of Wegovy, oral versions of its drugs, and CagriSema (which Novo has viewed as a key next step in its line of obesity treatments, having previously highlighted to investors the drug’s potential to deliver greater weight loss with minimal side effects).

On July 21, Novo filed a lawsuit against Lilly, alleging that its competitor’s advertising unfairly compares its drugs to Novo’s older, lower-dose medications and fails to take into account the latest data on the higher dose of Wegovy.

Lilly rejected these allegations, stating that its advertising is based on available clinical data.

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