Novo Nordisk shares drop 4.3% despite raised full-year guidance

Novo Nordisk's shares dropped by 4.3% in Copenhagen after the company reported its quarterly earnings and raised its full-year guidance. The decline came despite better-than-expected sales and operating profits, as investors remained concerned about ongoing pricing pressures and the company's ability to sustain growth in its obesity drug segment. The stock initially fell as much as 5% before slightly recovering.

The Danish pharmaceutical firm announced a shift in its financial outlook, now projecting adjusted sales and operating profit to decline by 6% to flat at constant exchange rates. This is an improvement from its previous forecast of a decline between 4% and 12%. CEO Mike Doustdar emphasized the positive volume growth stemming from the oral Wegovy pill, which he believes can drive profitability despite the pressure from lower prices. He stated that the strategy was showing signs of success, with volume growth in double digits.

However, analysts expressed skepticism about the company's performance. They noted that the quarterly results were influenced by temporary factors, such as rebate adjustments, and that sales of obesity drugs met expectations but were not exceptional. The performance of oral Wegovy slightly missed forecasts, adding to concerns about Novo’s future growth, especially as competition from Eli Lilly's weight-loss medications, Zepbound and Mounjaro, continues to intensify.

Novo Nordisk is under pressure to reassure investors about its growth prospects, particularly in the U.S. market. The company is working to find a balance between pricing and volume, as it faces increasing competition. The mixed results from its next-generation weight-loss drug, CagriSema, have also raised questions about its long-term product pipeline. As the market evolves and competitors gain ground, Novo's ability to adapt will be crucial for restoring investor confidence.