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We’ve been writing about the war over weight-loss drugs for a while—but these days it feels like everyone is losing.
Novo Nordisk, which used to be the unchallenged king of GLP-1 weight-loss shots, has blown its lead over the past year, as evidenced by the Danish company’s serious guidance cut last week. Confirmation arrived with its Q2 results on Wednesday, when management announced it was ending a slew of experimental treatments, including a potential weight-loss pill. Shares have plummeted 59% over the past 12 months.
Novo Nordisk explicitly blamed off-brand telehealth companies, such as Hims & Hers Health, for eating into its market share. CEO Lars Jørgensen claimed on the earnings call that over 1 million people were using “copycat” Wegovy.
But Hims & Hers Health has problems of its own. Last May, Hims & Hers soared after a blue-chip GLP-1 shortage allowed the firm to start making its own knockoff semaglutide. That shortage has ended, and the FDA is tightening its rules on how Hims & Hers can operate. In June, Novo abruptly severed its partnership with Hims & Hers, arguing that the telehealth company was illegally selling GLP-1 drugs.
To top things off, shares have plunged 22.88% this week after Hims & Hers announced Q2 earnings. The company reported what seemed like an impressive 73% year over year increase in revenue, but that still fell short of Wall Street estimates—and the regulatory pressure being applied to its hit knockoff weight-loss drug means revenue may take a bigger hit ahead.
A tough pill to swallow
While Novo and Hims both lick their wounds, another pharma giant reported booming sales of its own GLP-1 medications.
Eli Lilly, which sells Zepbound and Mounjaro, just released a blockbuster Q2 this morning, beating Wall Street projections and raising its 2025 sales guidance. But a whole new arena—daily weight-loss pills—is changing the rules of the game once again.
Despite the great Q2 numbers, shares of Eli Lilly dipped 14.19% today. The reason is that Eli Lilly also released a mixed bag of data for its experimental pill form of GLP-1 drugs, orforglipron. While the pill helped patients lose roughly 11% of their body weight during the clinical trial period, that’s still lower than the shot form Wegovy, according to Morgan Stanley analysts.
In addition, roughly a quarter of patients on the highest dose stopped taking the drug due to side effects, according to CNBC, complicating the premise that the pill will be easier to take and more effective than its injectable counterpart.
Shares of Novo jumped 7.47% today. After all, Eli Lilly’s loss is Novo’s gain.—LB