Novo Nordisk finds itself navigating significant operational and market headwinds. The company is intensely focused on maintaining its leadership in the obesity market against rival Eli Lilly. A recent positive opinion from European regulators for a substantially higher dose of its drug Wegovy represents a crucial strategic move, but the question remains: is it enough to regain lost ground?
Strategic Restructuring Under New Leadership
The company is undergoing a profound transformation. Since August 2025, new CEO Mike Doustdar has been at the helm, initiating a comprehensive restructuring in September of that year. The plan centers on cost reduction and strategic refocusing, with key elements including the elimination of approximately 9,000 positions globally (about 11% of the workforce), of which around 5,000 are in Denmark. The moves are expected to yield annual savings of about 8 billion DKK (roughly 1.25 billion US dollars) by 2026, with freed-up capital being reinvested into growth areas within diabetes and obesity.
European Regulators Endorse Higher Wegovy Dose
On December 12, 2025, Novo Nordisk announced that the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA) issued a positive opinion for a higher 7.2 mg dose of semaglutide (Wegovy). This recommendation typically precedes a formal decision by the European Commission. The new dosage marks a significant increase from the currently approved 2.4 mg variant. According to the company, pending final EU approval, the 7.2 mg dose could become available for patients with obesity early in the year, enabling an average weight reduction of 20.7%.
Clinical Data: Efficacy and Muscle Preservation
The EMA’s assessment is grounded in results from the STEP UP and STEP UP T2D clinical trial programs, which tested semaglutid 7.2 mg in obese patients with and without type 2 diabetes.
Key Efficacy Findings:
In the 72-week STEP UP study involving 1,407 adults with obesity (BMI ≥30 kg/m²) without diabetes, the data showed:
* An average weight loss of 20.7% of body weight after 72 weeks with the 7.2 mg dose, compared to 17.5% with the 2.4 mg dose.
* Approximately 33% of participants lost at least 25% of their body weight.
* About 84% of the weight lost was fat mass, with muscle function preserved.
* The safety profile was consistent with the established 2.4 mg dose.
The STEP UP T2D study, involving 512 adults with obesity and type-2 diabetes, confirmed the 7.2 mg dose’s superiority over placebo in weight reduction.
A central finding addresses a common concern with substantial weight loss: the preservation of muscle mass and function. Data presented at the 61st Annual Meeting of the European Association for the Study of Diabetes (EASD) in September 2025 indicated that while the therapy primarily reduced fat mass, muscle function was maintained. This is a critical consideration for physicians, as weight reduction without regard for body composition can be medically problematic.
Intensifying Competition from Eli Lilly
The EMA recommendation arrives as Novo Nordisk faces mounting pressure in the obesity segment. Eli Lilly has made substantial gains with its tirzepatide-based treatments Mounjaro (for type-2 diabetes) and Zepbound (for obesity). In the United States, Zepbound has recently surpassed Wegovy in terms of weekly prescription numbers.
The higher Wegovy dose is a direct response to this competitive threat. With an average weight loss of 20.7%, Novo Nordisk’s efficacy data approaches the levels that made Zepbound formidable in trials. For investors, this development is not merely about a new patient option, but a critical defense of market share in a multi-billion dollar market.
Should investors sell immediately? Or is it worth buying Novo Nordisk?
Stock Performance and Valuation Contraction
Market sentiment is clearly reflected in the share price. The stock is down approximately 50% since the start of the year, trading around €42.51—well below its 52-week high of €103.16. This pressure has been triggered by multiple earnings forecast reductions, increasing GLP-1 competition, slower-than-hoped market expansion, and the widespread use of compounded semaglutide in the U.S.
Concurrently, the valuation has cooled significantly. The equity is currently trading at about 13 to 14 times expected earnings, markedly below its five-year average of around 29 times. This signals that the market is heavily weighting near-term growth and margin risks, despite the company’s continued dominant position in the obesity and diabetes business.
Global Regulatory Strategy for the 7.2 mg Dose
Novo Nordisk is pursuing a coordinated international approval plan for the higher Wegovy dose.
- United States: In November 2025, the company submitted semaglutide 7.2 mg to the U.S. Food and Drug Administration (FDA) using the Commissioner’s National Priority Voucher (CNPV). This accelerated procedure entails a shortened review period of approximately one to two months following acceptance of the application.
- Other Markets: Alongside the EU, approval processes are underway in the United Kingdom and other regions to expand global availability.
In parallel, Novo Nordisk has applied to the EMA for a dedicated single-dose device for administering the 7.2 mg dose. Such a device could simplify use and improve treatment adherence—a significant factor in long-term therapies.
Pipeline: The Next Wave of Obesity Treatments
Beyond the higher Wegovy dose, the company is advancing several follow-on and complementary projects:
- CagriSema: A fixed-dose combination of cagrilintid and semaglutide, with a planned regulatory submission in 2026.
- Amycretin: A dual GLP-1 and amylin receptor agonist, slated to enter Phase III development in the first quarter of 2026.
- Oral Semaglutid 25 mg: Already submitted to the FDA for obesity treatment, with a decision expected in the fourth quarter of 2025.
These projects aim to further improve efficacy, tolerability, and administration methods, extending the product narrative beyond Wegovy.
Outlook: Catalysts on the Horizon Through 2026
Several potential stock-moving events and strategic milestones are scheduled for Novo Nordisk in the coming quarters:
- Q4 2025: FDA decision on oral semaglutide 25 mg for obesity.
- Early 2026: Expected final approval from the European Commission for Wegovy 7.2 mg and potential subsequent market launch.
- Q1 2026: Anticipated FDA decision on Wegovy 7.2 mg via the accelerated pathway.
- During 2026: CagriSema regulatory submission and head-to-head clinical trial results versus Eli Lilly’s Zepbound.
Analyst perspectives are divided. While the valuation appears low by historical standards, competitive pressures, U.S. pricing negotiations, and margin concerns are evident. For instance, Goldman Sachs maintains a buy recommendation but recently reduced its price target from $60 to $54—an indication that even optimistic observers are accounting for a challenging environment.
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