Novo Nordisk’s legal headaches in the United States are piling up at the worst possible moment. Hundreds of patients have filed suit against the Danish drugmaker and its American rival Eli Lilly, alleging that the GLP-1 treatments Ozempic and Wegovy caused serious optic nerve damage, according to Wall Street Journal reports.
At the heart of the litigation is non-arteritic anterior ischemic optic neuropathy (NAION) — an acute circulatory disruption of the optic nerve that can trigger sudden and irreversible vision loss. No effective causal treatment currently exists for the condition.
Novo Nordisk has pushed back firmly against the allegations, stating that its own scientific research found no elevated NAION risk among users of its GLP-1 therapies. Eli Lilly, whose Mounjaro and Zepbound products are also named in the complaints, likewise denies the claims.
Market share erosion adds to the pressure
The courtroom battle lands as Novo Nordisk is already losing ground commercially. In the second quarter, Eli Lilly captured 61% of the US GLP-1 market, leaving the Danish group with 39%. The picture is similarly uncomfortable in Medicare reimbursement, where Novo Nordisk has fallen behind.
That reversal marks a turning point in a segment the company had controlled for years. Eli Lilly expanded its footprint rapidly while Novo Nordisk wrestled with supply constraints and intensifying price competition. Management’s response has been to lean heavily into clinical development, having laid out long-term targets at its recent capital markets day that include pipeline revenue exceeding 150 billion Danish kroner by 2035.
For investors, the legal overhang now matters alongside the pace of approvals for next-generation therapies. Potential damages or protracted court proceedings represent an additional layer of uncertainty in valuing the stock.
A licensing spree aimed at the next generation of weight-loss drugs
Novo Nordisk is not standing still. On Tuesday it signed a global licensing agreement with Nanexa worth up to roughly EUR 1.17 billion — equivalent to as much as USD 1.33 billion — targeting long-acting injectable medicines for obesity, type 2 diabetes and other cardiometabolic conditions.
Just days earlier, on September 17, the company struck a research and licensing partnership with Orbis Medicines valued at up to USD 1.4 billion to develop oral therapies. Novo Nordisk is also taking a strategic stake in Orbis, though the financial size was not disclosed. The flurry of deals underscores how aggressively the group intends to open up new delivery formats in its fight against Eli Lilly.
CEO Mike Doustdar told Reuters on Tuesday that alternative administration routes carry enormous potential. In his view, oral weight-loss pills could capture as much as half the global obesity drug market by 2030. With competitors focusing primarily on injections, Doustdar sees a long-term edge for Novo Nordisk.
Should investors sell immediately? Or is it worth buying Novo Nordisk?
The central question for shareholders is whether that technological leap arrives in time, before pricing pressure on the existing portfolio erodes earnings. At the capital markets day, BMO analyst Evan Seigerman noted that projected revenue growth of 3.6% is already priced in. In his assessment, management now bears the burden of proving it can deliver.
CagriSema data fuels the pipeline narrative
Hopes rest heavily on the drug candidate CagriSema, which presented fresh study data on Monday. In a late-stage diabetes trial, the treatment achieved average weight loss of 12.4%, outperforming a 5 mg dose of Eli Lilly’s tirzepatide. A separate late-stage obesity study showed 21% weight loss versus a placebo.
Building on that clinical foundation, Novo Nordisk aims to bring more than five new blockbuster medicines to market by 2030. By 2035, management targets additional pipeline revenue above 150 billion DKK. According to the company, its balance sheet is strong enough to finance larger acquisitions if needed.
The group is also betting on modern technology to accelerate research cycles. On September 16, it entered a collaboration with Anthropic to deploy Claude models in drug discovery and software development.
Execution risk looms large
The ambitious plans carry meaningful risk, given how fiercely contested the obesity market remains. Doustdar urged employees on September 15 to build a more customer-focused culture in order to win back lost ground against Eli Lilly. At the same time, management faces increasingly pointed questions about its own pricing power.
Add to that the financial exposure of costly licensing deals. Payments such as the potential EUR 1.17 billion for Nanexa flow into projects whose commercial payoff will only become clear years from now. Setbacks in clinical phases or regulatory delays could quickly undermine the optimistic revenue targets.
Investor skepticism is already visible in the share price. The stock has lost 23% since the start of the year. On Friday it closed at EUR 34.05, leaving it 38% below its 52-week high. Over a seven-day stretch, the shares fell 9.5%.
For investors, the strategic question is whether the current weakness represents a buying opportunity or the start of a longer slump. As long as clinical development of hopefuls like CagriSema progresses on schedule and the balance sheet retains room for strategic deals, a re-rating remains a real possibility. Should confidence in the long-term pipeline forecasts falter, or competition force deeper price concessions, further losses could follow. Much will depend on whether Novo Nordisk can translate its partnerships with Nanexa and Orbis into tangible clinical progress — making upcoming reports on ongoing approval processes and trials essential reading for shareholders.
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