Novo Nordisk Just Got Roundhouse Kicked in the Face, Shares Collapse 23% After Guidance Cut

“I immediately regret this decision…” 

Novo Nordisk just did the unthinkable: they torpedoed their own rocket mid-flight. The Danish drug giant… formerly crowned Europe’s most valuable company… lit $100 billion in market cap on fire Tuesday, as shares cratered 23% after a double fist of corporate whiplash: a surprise CEO handoff and another slashed full-year forecast. That’s two in two months. Someone get this company some milk. 

(Source: Stream Community) 

For starters, this whole shindig started with the warm handoff from Lars Fruergaard Jørgensen, who was quietly ejected from the CEO suite back in May without a replacement lined up. The new guy? Well, according to investors he wasn’t very new at all. Maziar “Mike” Doustdar… company lifer since 1992 and the kind of executive who probably still signs emails with “Warmest Regards.” The problem is that Wall Street wanted a visionary with some fresh meat, instead they got 1992’s Most Valuable Office Clerk. Meaning, while Mike was being trotted out with quotes about “urgency” and “aiming higher,” investors were busy aiming for the exits.

(Source: CNBC) 

Additionally, the other gut punch is that Novo also downgraded its sales growth outlook from 13–21% to 8–14%. Operating profit guidance got trimmed too. The culprit? America’s appetite for Wegovy and Ozempic has gone flabby. Turns out, the stampede to slim down was a bit... overstated. According to the company, second-half sales of their flagship weight loss and diabetes drugs are expected to disappoint. Why? For starters, we have knockoff galore in the fact that compound GLP-1s are still flooding the U.S. market like it's the Wild West (sup, Hims). 

Elsewhere, we have market fatigue and the one tiny little problem that not veryone wants to jab themselves in the gut for $2,000/month out-of-pocket. Insurance ghosting is another issue where coverage remains more spotty than UnitedHealth’s bullish volume, leaving Novo reliant on patients with deep wallets and zero impulse control. Oh, and there’s the wailing and knashing of teeth that is competition. Eli Lilly’s Zepbound is hitting shelves like a protein shake in a blender fight, and Novo’s next-gen drug candidate, CagriSema, quite literally shat the bet on it’s latest clinical trial. Bigly. 

(Source: Giphy) 

Add it all up and what do you get? A valuation cliff dive so steep, even Ozempic’s appetite suppression can’t distract from it. Now to be fair, Novo insists the copycat issue will “phase out” now that the FDA has removed Wegovy from its shortage list. But that’s cold comfort when your core U.S. growth story is already wheezing into a CPAP machine. The company has now lost over 42% of its value this year. Which means, which means… for a company that was high on it’s own demand throughout 2024 and presumably being front and center in RFK’s wet health dreams… Novo has truly experienced what it means to see the turntables turn on them. 

Understandably, investors aren’t just reacting to a bad quarter. They’re waking up to the possibility that Novo’s dominance in the weight loss drug market isn’t destiny… it was timing. And now that the rest of Big Pharma has sniffed out the $100 billion goldmine, the moat looks more like a fad than anything. So with that, here we are. Wall Street is officially off its Wegovy high. Novo’s new CEO has inherited a company with softening demand, intensifying competition, and a market that’s realizing even miracle drugs eventually run into the miracle of insurance denials and human laziness.

(Source: Giphy)

Of course, we’ll see whether or not the FDA removing Wegovy from the shortage list will have any impact, but considering the realization that demand isn’t quite… demand, it could be a stretch. So for now, keep your eyes on this story and place your bets accordingly. Until next time, friends… 

At the time of publishing, Stocks.News does not hold positions in companies mentioned in the article.