Novo Nordisk's Next-Gen Weight-Loss Drug Fails Key Trial, Stock Plummets

Novo Nordisk's path to reclaiming dominance in the weight-loss drug market hit a major obstacle Monday. Clinical trial results for its experimental treatment, CagriSema, failed to meet a critical goal, sending the company's shares down 16% and drawing sharp criticism from analysts.

The study aimed to prove CagriSema was at least as effective as Eli Lilly's leading drug, tirzepatide. Instead, after 84 weeks, participants on CagriSema saw an average 23% weight loss, falling short of tirzepatide's 25.5%. The company stated the drug "did not achieve its primary endpoint" of proving non-inferiority.

"This is something of a swing and a miss," said AL Sydbank senior analyst Søren Løntoft Hansen. Deutsche Bank's Emmanuel Papadakis was blunter on an investor call, telling Novo management the drug now looked "somewhat obsolete" as a competitive alternative.

CEO Mike Doustdar pushed back, calling CagriSema "a fantastic drug" and highlighting its potential as the first amylin-based product to reach the market, possibly early next year. Novo is banking on a higher-dose trial and pending regulatory approval to change the narrative. However, the immediate fallout is severe, extending the Danish firm's stock decline to nearly 60% over the past year as Lilly continues to gain ground.

Source: The Guardian