Novo Nordisk Shares Face Mounting Challenges on Pricing and Competition

The investment case for Danish pharmaceutical giant Novo Nordisk is being tested on multiple fronts. As its shares attempt to stabilize following a significant setback in late November, new pressures are emerging that threaten its profitability and growth strategy. Key developments in the United States and India are now drawing market scrutiny.

Investor sentiment took a major hit on November 24th. On that date, Novo Nordisk disclosed that its Phase 3 EVOKE and EVOKE+ trials for oral semaglutid in early Alzheimer's disease had failed to meet their primary endpoints. The announcement triggered an immediate sell-off, with the stock plunging approximately 10% as hopes for a successful expansion into the neurodegenerative disease segment were dashed.

Since that decline, the share price has been trading in a range between $47 and $48, searching for a solid foundation. From its July 2024 highs, the equity has lost roughly 60% of its value—a consequence of both the disappointing CagriSema results in December 2024 and the more recent Alzheimer's trial failure.

US Pricing and Indian Competition Intensify

Two fresh concerns are now compounding these existing pressures. In the critical US market, reports from MarketWatch at the end of last week highlighted increasing price disparities for the obesity drug Wegovy. The coverage suggests growing pressure from health insurers, who are negotiating varied reimbursement models. For Novo Nordisk, which relies on Wegovy as a primary revenue driver in its lucrative obesity segment, this introduces margin uncertainty, especially amid ongoing political discourse surrounding drug pricing legislation.

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Simultaneously, the competitive landscape in the strategic growth market of India is shifting. In early December, an Indian court permitted the generic drug manufacturer Dr. Reddy's Laboratories to begin producing generic versions of Novo Nordisk's blockbuster medications. This legal development coincides precisely with Novo Nordisk's preparations for the commercial launch of Ozempic in India this month. The market, once viewed as a key expansion opportunity, may now prove more difficult and less profitable to penetrate than initially projected.

High-Dose Wegovy: A Potential Catalyst

Amid these challenges, one significant advancement offers a counterbalance. In late November, Novo Nordisk submitted an application to the US Food and Drug Administration (FDA) for a high-dose 7.2 mg version of Wegovy. Clinical data for this formulation demonstrated an average weight loss of 20.7%, a figure considered competitive when directly compared to Eli Lilly's Zepbound. The FDA has granted the application a priority review, with a decision expected in early 2026.

Securing approval for this higher-dose treatment is viewed by market experts as a potential means to rebuild investor confidence and strengthen the company's dominant position in the metabolic disease sector. Analysts note that the core investment thesis—Novo Nordisk's leadership in metabolic treatments—remains intact, despite near-term valuation pressures from pipeline disappointments.

A Critical Technical Level

Market observers are closely watching the $47 support level in the coming weeks. A sustained break below this threshold could see the share price retreat toward levels not seen since 2021. The near-term trajectory will likely be determined by the initial reception of Ozempic in the Indian market and the company's ability to stabilize net pricing in the United States for 2026. The next quarterly report, scheduled for February 2026, should provide the first concrete data on these fronts.