Novo Nordisk ($NVO) has been probably the most influential healthcare firms because of its weight problems medicine Ozempic and Wegovy. These merchandise modified the load loss trade, drove explosive income development and briefly made Novo Nordisk Europe’s most dear firm. However 2025 has marked a pointy reversal. The inventory is down about 50 % for the 12 months, signalling a significant shift in investor expectations. The query is easy: is that this the start of a protracted decline, or the form of reset that creates alternative for long-term traders?
1. The Twist in Novo’s Journey
The turning level started in the USA, which accounts for 58 % of Novo Nordisk’s income. Development expectations have been reduce a number of occasions, Wegovy demand softened, and round a million People shifted to cheaper compounded semaglutide, pulling significant quantity away. On the similar time, Eli Lilly expanded provide of Mounjaro and Zepbound and secured broader insurance coverage protection, growing aggressive stress.
Pipeline updates added to the weak spot. CagriSema delivered 22.7 % weight reduction, sturdy however under investor expectations, and the inventory dropped about 10 %. Lately, an Alzheimer’s trial failed, pushing shares to a four-year low and elevating questions on Novo’s pipeline exterior GLP-1 medicines.
A management transition created additional uncertainty. New CEO Mike Doustdar tried a ten billion greenback takeover of Metsera, however Pfizer received the bid with a decrease provide and regulators flagged consolidation considerations. The scenario break up traders between seeing strategic imaginative and prescient and seeing urgency.
2. Resetting the Playbook
Dealing with stress on development, pricing and provide, Novo Nordisk launched a broad strategic reset. The corporate reduce out-of-pocket costs for Ozempic and Wegovy to 199 {dollars} for starter doses and 349 {dollars} month-to-month, with Medicare pricing set to drop towards 245 {dollars} and oral GLP-1 choices doubtless close to 149 {dollars} by 2027. The objective is to develop entry and gradual the migration towards compounded alternate options.
On the similar time, Novo is investing greater than 9 billion {dollars} in 2025 to develop world manufacturing. This contains doubling U.S. manufacturing together with main expansions in Denmark, France, China and Brazil. Some provide tightness is anticipated by way of 2025 as amenities ramp up.
To assist this shift, Novo Nordisk can be restructuring. About 9,000 jobs (roughly 11 % of the workforce) can be eradicated, together with 5,000 roles in Denmark. Hiring continues in manufacturing, scientific growth and industrial areas, whereas nonessential recruitment is frozen.
3. What the Numbers Reveal
Regardless of the challenges, Novo Nordisk continues to ship sturdy monetary efficiency. Within the first 9 months of 2025, gross sales reached DKK 229.9 billion, up 12% 12 months over 12 months, whereas working revenue grew 5% to DKK 95.9 billion. Weight problems care remained the strongest engine, with gross sales rising 41% at fixed change charges to DKK 59.9 billion. EBITDA reached DKK 112.3 billion, reflecting one of many highest profitability ranges within the world pharmaceutical trade.
What stands out most is the valuation reset. Novo Nordisk now trades at:
P/E round 13• ahead P/E round 12• EV/EBITDA round 9• worth to gross sales round 4.3• worth to e-book round 8
Traditionally Novo Nordisk traded at a P/E between 22 and 27. The present valuation is subsequently 40–50% under its long run common.
The market now not costs Novo Nordisk as a high-growth innovator and is now valuing it extra like a mature pharmaceutical firm. This shift cuts each methods. If development weakens once more, the inventory might fall additional, however the decrease valuation additionally offers Novo room to outperform if situations begin to stabilize.
To shift sentiment the corporate might want to ship on three areas:
stabilisation of Wegovy demand• profitable enlargement into excessive quantity applications equivalent to Medicare, TrumpRx and decrease priced tiers• a aggressive pipeline, particularly the oral weight problems drug anticipated in 2026 and future CagriSema growth
If these parts strengthen, right this moment’s valuation might show overly pessimistic.
4. Will the Inventory Get better or Fall Additional?
The longer term course of the share worth will rely upon a number of elements, however the scenario is now extra outlined than earlier within the 12 months. The principle challenges, weaker US demand, stronger competitors and a narrowed full 12 months outlook are already recognized and mirrored within the share worth. The main target now shifts to how Novo Nordisk manages the subsequent stage.
What is going to traders look within the close to future:• updates on Wegovy demand in the USA• the dimensions of compounded GLP 1 use• any changes to 2025 steerage
These areas nonetheless affect how shortly efficiency within the US market can stabilize.
Wanting additional forward, a number of milestones might form the medium time period outlook, though most of them fall in 2026 or later:
the launch of the oral weight problems drug• regulatory choices that have an effect on pricing or entry• enlargement into giant quantity applications equivalent to Medicare• new scientific information from pipeline candidates
Novo Nordisk ($NVO) stays a big world participant with sturdy monetary efficiency, however the surroundings round it has change into extra complicated. Competitors, pricing stress and regulatory elements are prone to proceed affecting the inventory as new data emerges. The general course is open, and the subsequent section will rely upon firm execution and broader market situations.
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