Novo Nordisk Faces Pricing Pressure as Obesity Drug Awaits FDA Review

The Danish pharmaceutical giant Novo Nordisk has formally submitted its new obesity treatment, CagriSema, for approval with the U.S. Food and Drug Administration (FDA). This regulatory milestone arrives amid a rapidly shifting competitive landscape, where rival Eli Lilly has initiated an aggressive price war, casting a shadow over the commercial prospects for Novo's promising pipeline asset.

The FDA application is supported by compelling data from the Phase 3 REDEFINE 1 trial, which involved 3,417 participants. The study's outcomes highlight CagriSema's potential efficacy:

• Under real-world conditions, patients achieved an average weight loss of 20.4%, starkly contrasting with the 3.0% loss observed in the placebo group.
• When participants adhered strictly to the treatment protocol, the average weight reduction increased significantly to 22.7%.
• A remarkably high response rate was recorded, with 91.9% of trial subjects losing at least 5% of their body weight.
• Notably, 40.4% of protocol-compliant patients shed more than a quarter of their starting weight.

These figures position CagriSema as a potential leader in the obesity medication market based on sheer clinical performance.

Institutional Selling Contrasts Pipeline Progress

Despite the strong trial data, recent regulatory filings reveal a wave of selling by major institutional investors during the third quarter. Stokes Capital Advisors LLC slashed its stake by 77.5%, divesting 54,069 shares. Similarly, Channel Wealth LLC reduced its holding by 67.7%, selling over 43,000 shares.

This institutional retreat has contributed to the equity's struggle to reclaim the $50 level, a resistance point it has failed to breach even following the positive news of the FDA submission.

Should investors sell immediately? Or is it worth buying Novo Nordisk?

Quarterly Revenue Falls Short of Expectations

Novo Nordisk's third-quarter 2025 financial results presented a mixed picture. While earnings per share came in between $0.69 and $0.70, surpassing the consensus range of $0.65 to $0.77, the company's top-line performance disappointed. Revenue totaled $11.79 billion, missing the market's expectation of $11.98 billion.

This revenue shortfall has fueled concerns about a potential growth deceleration for the firm as market competition intensifies.

Eli Lilly Declares Price War Ahead of Key Launch

Adding to Novo Nordisk's challenges, competitor Eli Lilly enacted substantial price cuts for its obesity drugs Zepbound and Mounjaro, effective December 1, 2025. On its direct distribution platform, the monthly starting dose of Zepbound is now priced at just $299. This strategic move, announced mere weeks before Novo's regulatory filing, signals the start of a fierce pricing battle heading into 2026.

The timing presents a significant hurdle for Novo Nordisk, which now faces margin pressure precisely as it prepares to launch its premium-priced candidate, CagriSema.

Valuation and the Crucial Test Ahead

As of December 17, Novo Nordisk shares are trading near a historically low valuation of approximately $47.77. The market appears to have priced in considerable risk. Although CagriSema's clinical profile is robust, its path to commercial success has grown more costly and competitive. The critical test in early 2026 will extend beyond securing FDA approval; it will hinge on the company's ability to maintain its pricing power in direct opposition to Eli Lilly's discount-driven strategy.