Lars Fruergaard Jørgensen to exit as Novo Nordisk navigates falling share prices and rising competition from rivals like Eli Lilly and Zealand Pharma in the booming weight-loss drug market.
Novo Nordisk, the Danish pharmaceutical giant renowned for its weight-loss drugs Wegovy and Ozempic, announced today that CEO Lars Fruergaard Jørgensen will step down following a significant decline in the company’s stock price and mounting competition in the obesity treatment sector.
Jørgensen, who has led the company since 2017, will remain in his position until a successor is appointed. The decision was made in collaboration with the Novo Nordisk Foundation, which holds 77% of the company’s voting shares.
Former CEO Lars Rebien Sørensen will join the board as an observer, with plans to take a permanent seat at the next annual meeting .
Under Jørgensen’s leadership, Novo Nordisk experienced substantial growth, becoming Europe’s most valuable listed company, primarily due to the success of its GLP-1-based drugs.
However, since reaching a share price peak in June 2024, the company’s stock has fallen by 59%, driven by increased competition, particularly from Eli Lilly’s Zepbound, which has outpaced Wegovy in U.S. prescriptions. Disappointment with Novo Nordisk’s new drug pipeline has further impacted investor confidence.
Investors are concerned that its obesity and diabetes drugs are losing ground to US rival Eli Lilly, and have been disappointed by trial results from next-generation medicines in its pipeline.
In light of recent market headwinds, falling share prices, and a request from the Novo Nordisk Foundation, the company announced that its board and CEO Lars Fruergaard Jørgensen have mutually agreed that a leadership transition is in the best interest of both the company and its shareholders.
The obesity drug market has become increasingly competitive, with Eli Lilly’s Zepbound emerging as a formidable rival to Novo Nordisk’s Wegovy. Zepbound has gained significant traction in the U.S., surpassing Wegovy in prescription volumes.
Additionally, Zealand Pharma’s survodutide has shown promising results in early trials, adding to the competitive pressure.
In response to market dynamics, Novo Nordisk has made strategic moves, including launching a direct-to-patient online pharmacy, NovoCare, offering Wegovy at a reduced price to cash-paying customers without insurance coverage. This initiative aims to enhance accessibility and affordability for patients, particularly as competition intensifies. .euronews+1Medical Dialogues+
Despite the leadership change, Novo Nordisk maintains that its strategic direction remains solid. The company continues to focus on expanding its presence in global markets and advancing its drug development pipeline.
Novo Nordisk is actively searching for a new CEO who can navigate the evolving landscape and lead the company through its next phase of growth.
As the obesity drug market continues to evolve, Novo Nordisk’s ability to adapt to competitive pressures and market demands will be crucial in maintaining its position as a leader in the industry.
Despite recent challenges, Novo Nordisk has made significant investments to bolster its position in the market. In December 2024, Novo Holdings, an investment foundation of Novo Nordisk, acquired three manufacturing sites from Catalent to expand production capacity for its weight-loss drugs. Additionally, the company is actively searching for a new CEO who can navigate the evolving landscape and lead the company through its next phase of growth .
Last week, Novo Nordisk reported weaker-than-expected first-quarter sales for its flagship obesity drug Wegovy and revised its full-year sales growth forecast downward, citing growing competition from compounded versions of the drug in the U.S. market.
“Compounders took a part of our business away,” CEO Lars Fruergaard Jørgensen told CNBC’s Charlotte Reed.
Despite the setback, the company remains optimistic, forecasting stronger sales in the second half of the year as the availability of compounded alternatives declines. This follows the U.S. Food and Drug Administration’s recent decision to end its drug shortage designation for semaglutide, which had previously allowed pharmacies to produce unbranded versions of the medication.
Novo Nordisk has also been working to overcome negative investor sentiment after underwhelming trial results for its next-generation obesity treatment, CagriSema. Still, Jørgensen has expressed confidence in the drug’s future, saying, “From the data we have, CagriSema is the best product that has been tested or is currently on the market, and we believe those results can improve even further.”
Despite the leadership change, Novo Nordisk maintains that its strategic direction remains solid. The company continues to focus on expanding its presence in global markets and advancing its drug development pipeline. Novo Nordisk is actively searching for a new CEO who can navigate the evolving landscape and lead the company through its next phase of growth. .MarketWatch
As the obesity drug market continues to evolve, Novo Nordisk’s ability to adapt to competitive pressures and market demands will be crucial in maintaining its position as a leader in the industry.
