Spread of obesity drugs

Novo Nordisk, Eli Lilly are ahead, but others have similar products in pipeline.

- Liesl Peyper

Pharmaceutical giant Novo Nordisk seems to have lost some of its lustre. The Danish manufacturer of diabetes and weight loss drugs Ozempic and Wegovy has seen its share price drop by around 19% this month, from the highs of June this year.

Novo Nordisk, whose market value is estimated to be $514 billion (around R9 trillion) – which makes it bigger than the entire Danish economy – is facing competition from other pharmaceutical companies, most notably America's Eli Lilly.

Eli Lilly is achieving significant success with its rival drugs Mounjaro and Zepbound.

But although Novo Nordisk's performance has disappointed of late, the company is still a market dominator (together with Eli Lilly), given its first-mover advantage, as well as its research and development and manufacturing capabilities, said Lizelle van Rooyen, equity analyst at Denker Capital.

“Investors are currently more upbeat about Eli Lilly's successes, especially with the development of oral versions of its weight loss drugs which are at this point only injectable.

“But even though sentiment towards Novo is changing, the risk of huge market share losses will likely only realise later in this decade,” she said.