Ozempic maker takes $107 billion hit as alarm bells ring louder
Novo named Maziar Mike Doustdar as its new chief executive, turning to a veteran insider to revive sales and reassure investors rattled by fears the Danish drugmaker is losing ground in the obesity drug race it started.
Doustdar's appointment failed to stem a stock market rout sparked by Novo slashing its outlook for 2025 sales growth to between 8 per cent and 14 per cent, from between 13 per cent and 21 per cent previously. Its shares plunged nearly 30 per cent before paring some losses to trade down over 20 per cent by mid-afternoon. The shares are now down 44 per cent this year.
'The magnitude of the guidance cut is a shocker,' Markus Manns, a portfolio manager at mutual fund firm Union Investment, a Novo shareholder, told Reuters, adding that Novo's issues went deeper than 'compounded' copycats to Wegovy.
Compounded drugs are custom-made medicines that are based on the same ingredients as branded drugs.
Novo has been hit by copycats of its GLP-1 drugs Wegovy for weight-loss and Ozempic for diabetes. US law bars pharmacies from replicating approved drugs, but has allowed 'compounding' for patients needing custom doses or formulations.
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The company said in a statement that it cut its 2025 sales outlook due to lower growth expectations in the second half in the US, both for Wegovy and Ozempic in the GLP-1 diabetes market.
The drugmaker, which became Europe's most valuable listed company following the launch of Wegovy in 2021, is now facing a reckoning as it looks to turn things around after the abrupt removal in May of CEO Lars Fruergaard Jorgensen.
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