Novo’s new obesity results send shares to record high
Follow-on pill to Ozempic and Wegovy
Novo Nordisk A/S touted the potential of its next-generation obesity treatments, releasing promising data on an experimental daily pill and sending its shares soaring to a record.
A new treatment called amycretin, which targets two modes of action against obesity including GLP-1, such as the blockbuster injection Wegovy, helped patients shed 13 per cent of their weight over 12 weeks in an early-stage test.
The study was small, but Novo said in a meeting with investors that it provides a basis for further development of the pill, boosting hopes for its future. The stock rose as much as 8.3 per cent in Copenhagen, extending the past year’s 68 per cent gain.
Novo’s next-generation projects are key as the Danish drugmaker attempts to keep the lead in the growing market for obesity treatments. The success of Wegovy and its sister drug Ozempic has turned Novo into Europe’s biggest publicly traded company and the 12th largest worldwide, and its share gain on Thursday boosted its market value to US$600 billion.
The 13 per cent weight loss in Novo’s amycretin trial was better than what was shown by a competing experimental pill from rival Eli Lilly & Co., Emily Field, an analyst at Barclays PLC, said in a note to investors.
Novo is moving quickly on the compound, she noted, with management saying it wouldn’t rule out jumping straight to a finalstage trial, the kind that could be the basis for regulatory approval.
Novo got a further boost when U.S. health insurer Cigna Group said Thursday that it has agreements with the drugmaker and rival Eli Lilly & Co. aimed at widening coverage of obesity drugs. Cigna’s offering to U.S. employers would limit how much their health plans would pay for the drugs and keep spending increases on them to a maximum of 15 per cent annually.
Novo chief executive Lars Fruergaard Jorgensen, speaking at the start of a day-long event about strategy and research, described the obesity market as “a tremendous runway.”
Novo has struggled to meet demand for Ozempic and Wegovy, despite list prices exceeding US$1,000 a month. The company has pushed to boost production, agreeing last month to pay US$11 billion for three factories from drug supplier Catalent Inc.
A large study showing that Wegovy cut the risk of heart attacks and strokes in patients with obesity will help as Novo negotiates with insurers, the company said.
The drug was as much as twice as cost effective in patients like those in the heart-disease trial, said Camilla Sylvest, Novo’s chief of commercial strategy and corporate affairs. “That means we have a great starting point for having discussions with payers.”
WE HAVE A GREAT STARTING POINT FOR HAVING DISCUSSIONS WITH PAYERS.
US$80-BILLION MARKET
Novo is also facing its first competition, U.S. rival Eli Lilly & Co.’s Zepbound, after having the market for potent weight-loss shots to itself for more than two years. Other competitors are on the horizon, though Bloomberg Intelligence predicts Novo and Lilly will dominate a Us$80-billion market for obesity medicines by 2030.
Closest to reaching patients is a Novo shot called Cagrisema, which combines the medicine in Wegovy with another compound for weight loss. The pill in early-stage trials uses the same approach in a single tablet, and Novo is studying that compound as a shot as well.
“This is a very competitive profile,” said Marcus Schindler, Novo’s chief of research and early development.
This is the first time the company has combined the two entities into a single molecule, he added.