U.S.-listed shares of Novo-Nordisk came under pressure on Friday, after results from a late-stage trial of the healthcare company’s experimental CagriSema obesity drug fell short, sending shares about 25% lower intraday.
The Danish company said that results from its phase 3 trial investigating CagriSema in overweight people or with obesity, helped patients lose an average of 22.7% of their body weight, but less than the company's expectations for “at least 25%”, which it had been telling investors for over a year that it expects to achieve.
But analysts noted that the results showed similar success rates as Zepbound, a weight-loss drug already on the market from rival Eli Lilly, pushing shares of Eli Lilly (NYSE: LLY) 1.4% higher.
Wall Street was expecting sales of CagriSema to outperform Zepbound, and according to FactSet, CagriSema sales were expected to hit $15.6 billion a year by 2029.
Analysts believe that the REDEFINE 1 trial weight loss is not high enough to create a barrier relative to future competition, despite the data still being ahead of Wegovy. It is however sufficient for commercialisation, and will likely switch ahead of semaglutide loss of expiration in 2031.
“We are encouraged by the weight loss profile of CagriSema demonstrating superiority over both semaglutide and cagrilintide in monotherapy in the REDEFINE 1 trial. This was achieved even though only 57% of patients reached the highest CagriSema dose,” said Martin Holst Lange, executive vice president for Development at Novo Nordisk.
“With the insights obtained from the REDEFINE 1 trial, we plan to further explore the additional weight loss potential of CagriSema,” he added.
The results from the second pivotal phase 3 trial, REDEFINE 2, in adults with type 2 diabetes and either obesity or overweight are expected during the first half of 2025, and Novo plans to submit CagriSema for regulatory approval towards the end of 2025.
With Novo’s announcement, the result seemingly confirms Eli Lilly’s position as the leader in the obesity market, with Eli Lilly’s Zepbound demonstrating greater efficacy than Novo’s Wegovy drug in the head-to-head trial.
Once-weekly CagriSema is a combination of semaglutide, which is the medicine sold under Novo’s brand names Ozempic and Wegovy, and cagrilintide another medicine, which is being investigated as a treatment for adults with overweight or obesity and as a treatment for adults with type 2 diabetes.
Novo-Nordisk (NYSE: NVO) closed 17.83% lower at $85.00.
