Novo Nordisk shares slide after unusual miss on weight issues drug Wegovy product sales By Reuters

By Maggie Fick

LONDON (Reuters) -Novo Nordisk on Wednesday trimmed its full-year income outlook after reporting weaker-than-expected quarterly product sales of its widespread weight-loss drug Wegovy, stirring worries amongst patrons about stiffening rivals from Eli Lilly (NYSE:).

The outcomes end a power streak of constructive earnings data from the first mover inside the weight issues drug race which has seen its value surge to higher than $500 billion, making it Europe’s Most worthy listed agency.

Novo shares, which have soared some 230% since June 2021, fell as quite a bit as 7.7% in early shopping for and promoting and had been down 4.6% at 1203 GMT, putting them among the many many largest fallers on the broader and inside attain of their February lows.

Chief Financial Officer Karsten Munk Knudsen in an interview known as the market response unsurprising, given the market’s sensitivity to Novo’s mega-blockbuster drug Wegovy.

Second-quarter income moreover missed expectations, doubtlessly deepening investor worries that Novo’s dominance inside the fast-growing weight issues drug market – which some forecast may be worth about $150 billion by the early 2030s – is in peril as a result of it races to develop functionality to meet runaway demand.

The comfy second-quarter outcomes are “in sharp distinction to the massive product sales and earnings beats we’ve bought seen ultimate 12 months”, acknowledged Markus Manns, a portfolio supervisor at Novo shareholder Union Funding in Germany.

CEO Lars Fruergaard Jorgensen downplayed points over rivals from U.S. rival Lilly in a reputation with journalists, saying that he didn’t see these dynamics having a huge effect on product sales inside the foreseeable future.

CFO Knudsen acknowledged U.S. prices of Wegovy had been lower this 12 months attributable to various anticipated parts along with value concessions to get insurance coverage protection entry in quite a few channels, and the doorway of a competitor.

Novo moreover acknowledged it ought to proceed limiting offers of the underside or starter dose of Wegovy to the U.S. market to verify victims who start remedy can proceed.

Second-quarter product sales had been moreover knocked by higher-than-expected rebates, or value concessions to U.S. pharmacy revenue managers. CFO Knudsen acknowledged it was a “quarterly blip”.

The Danish agency scale back its working income growth forecast this 12 months to between 20% and 28% in native currencies from 22% to 30% beforehand.

Working income inside the quarter rose 8% at fastened change costs to 25.9 billion Danish crowns ($3.8 billion) in distinction with the 27.3 billion crowns forecast by analysts in a LSEG poll.

Product sales of Wegovy, Novo’s first-to-market weight-loss drug, rose 53% to 11.66 billion crowns, properly underneath the 13.54 billion crowns anticipated by analysts, whereas product sales of Ozempic, a diabetes drug with the an identical vigorous ingredient, moreover merely missed expectations.

Novo ended a complicated kidney sickness trial in June, resulting in a 5.7 billion Danish crown impairment loss which it acknowledged impacted working income.

ALL EYES ON SUPPLY

Nevertheless, Novo raised its product sales growth outlook for this 12 months to between 22% and 28% in native currencies from 19% to 27% beforehand.

Jorgensen acknowledged on the media title that the enhance confirmed Novo is cosy in its functionality to further ramp up present, with out giving particulars.

Analysts from Barclays and Citi every acknowledged that although the second-quarter numbers had been weaker than anticipated, Novo’s statements on boosting Wegovy manufacturing had been reassuring.

Novo is spending billions of {{dollars}} to raise Wegovy manufacturing to meet runaway demand and fend off Lilly, which launched its rival treatment Zepbound inside the U.S. ultimate December.

Though Novo and Lilly in the intervening time are going head-to-head with weight issues therapies in loads of markets along with Britain and Germany, most likely essentially the most worthwhile one by far is the U.S., the place higher than 70% of adults are chubby or chubby.

The underside of 5 dose strengths of Wegovy continues to be in shortage, according to the U.S. Meals and Drug Administration site, which was updated late on Tuesday to point two further dose strengths had been now obtainable.

On Friday, the FDA updated its site to say Lilly’s Zepbound was obtainable, nevertheless it absolutely didn’t take away the drug from its shortage itemizing. It acknowledged in a press launch it was working with Lilly to confirm offers had been regular.

Lilly will launch quarterly numbers on Thursday.

Novo acknowledged it had withdrawn its submission to U.S. and European regulators for approval of Wegovy to take care of coronary coronary heart failure and kidney sickness, and plans to resubmit with further data at first of 2025.

($1 = 6.8397 Danish crowns)