Novo Nordisk Shares Fall Almost 5% Following Disappointing Obesity Pill Data – Reuters

By Maggie Fick and Jacob Gronholt-Pedersen

LONDON/COPENHAGEN – Shares of Novo Nordisk dropped nearly 5% on Friday following disappointing results from a Phase 2a trial of its experimental obesity pill, monlunabant, which fell short of market expectations.

The company shared preliminary findings from its trial of monlunabant, a drug it acquired as part of its $1 billion purchase of Canadian biotech firm Inversago Pharmaceuticals last year.

At a capital markets event in March, Novo Nordisk indicated that it anticipated the drug could produce weight loss of 15% of body weight, comparable to its successful obesity injection, Wegovy. However, the results released on Friday indicated that the once-daily pill only achieved 6.5% weight loss after 16 weeks.

Shares of Novo Nordisk were down 4.8% at 1407 GMT, marking the lowest level in over five weeks. Analysts at Nordnet commented that the weight loss results were “not what optimists are looking for,” highlighting the intensifying competition and growing investor caution about the drug’s potential.

Despite the less favorable weight loss outcome, Novo Nordisk announced plans to initiate a larger Phase 2b trial to further explore the medication’s dosage and safety over an extended period in a global population, with expectations to commence that trial next year.

Novo Nordisk was a pioneer with Wegovy, offering a highly effective weight loss solution from the GLP-1 receptor agonist drug class. Eli Lilly stands as the only other company with a competing obesity drug in the same category.

Both companies have reported record profits since these drugs were launched and recent analyses have forecasted annual global sales in the weight-loss drug market to reach approximately $150 billion by the early 2030s.

The competition is escalating among these companies and a growing number of others to develop more effective treatments in response to increasing demand.

Monlunabant functions as a cannabinoid or CB1 receptor blocker, which, while yielding similar effects to GLP-1 drugs, operates via a different mechanism.

In the trial involving 243 patients, gastrointestinal issues were the most frequently reported side effects. The company also noted some occurrences of mild to moderate neuropsychiatric side effects, such as anxiety and sleep disturbances, among those taking monlunabant compared to a placebo. Notably, no serious adverse events related to neuropsychiatric side effects were reported.

At the capital markets event, Novo Nordisk’s head of development, Martin Holst Lange, suggested there could be substantial potential if clinical trials can exclude neuropsychiatric disorders linked to previous failed drug candidates from the CB1 receptor class.

Following the data release from Novo Nordisk, shares of U.S. biotech firm Corbus Pharmaceuticals, which is also developing a weight-loss drug from the CB1 class, experienced a sharp decline.