Novo Nordisk ($NVO) has been one of the most influential healthcare companies thanks to its obesity drugs Ozempic and Wegovy. These products changed the weight loss industry, drove explosive revenue growth and briefly made Novo Nordisk Europe’s most valuable company. But 2025 has marked a sharp reversal. The stock is down about 50 % for the year, signalling a major shift in investor expectations. The question is simple: is this the beginning of a long decline, or the kind of reset that creates opportunity for long-term investors?
1. The Twist in Novo’s Journey
The turning point began in the United States, which accounts for 58 percent of Novo Nordisk’s revenue. Growth expectations were cut several times, Wegovy demand softened, and around one million Americans shifted to cheaper compounded semaglutide, pulling meaningful volume away. At the same time, Eli Lilly expanded supply of Mounjaro and Zepbound and secured broader insurance coverage, increasing competitive pressure.
Pipeline updates added to the weakness. CagriSema delivered 22.7 % weight loss, strong but below investor expectations, and the stock dropped about 10 %. Recently, an Alzheimer’s trial failed, pushing shares to a four-year low and raising questions about Novo’s pipeline outside GLP-1 medicines.
A leadership transition created further uncertainty. New CEO Mike Doustdar attempted a 10 billion dollar takeover of Metsera, but Pfizer won the bid with a lower offer and regulators flagged consolidation concerns. The situation split investors between seeing strategic vision and seeing urgency.
2. Resetting the Playbook
Facing pressure on growth, pricing and supply, Novo Nordisk launched a broad strategic reset. The company cut out-of-pocket prices for Ozempic and Wegovy to 199 dollars for starter doses and 349 dollars monthly, with Medicare pricing set to drop toward 245 dollars and oral GLP-1 options likely near 149 dollars by 2027. The goal is to expand access and slow the migration toward compounded alternatives.
At the same time, Novo is investing more than 9 billion dollars in 2025 to expand global manufacturing. This includes doubling U.S. production along with major expansions in Denmark, France, China and Brazil. Some supply tightness is expected through 2025 as facilities ramp up.
To support this shift, Novo Nordisk is also restructuring. About 9,000 jobs (roughly 11 % of the workforce) will be eliminated, including 5,000 roles in Denmark. Hiring continues in manufacturing, clinical development and commercial areas, while nonessential recruitment is frozen.
3. What the Numbers Reveal
Despite the challenges, Novo Nordisk continues to deliver strong financial performance. In the first nine months of 2025, sales reached DKK 229.9 billion, up 12% year over year, while operating profit grew 5% to DKK 95.9 billion. Obesity care remained the strongest engine, with sales rising 41% at constant exchange rates to DKK 59.9 billion. EBITDA reached DKK 112.3 billion, reflecting one of the highest profitability levels in the global pharmaceutical industry.
What stands out most is the valuation reset. Novo Nordisk now trades at:
- P/E around 13
• forward P/E around 12
• EV/EBITDA around 9
• price to sales around 4.3
• price to book around 8
Historically Novo Nordisk traded at a P/E between 22 and 27. The current valuation is therefore 40–50% below its long term average.
The market no longer prices Novo Nordisk as a high-growth innovator and is now valuing it more like a mature pharmaceutical company. This shift cuts both ways. If growth weakens again, the stock could fall further, but the lower valuation also gives Novo room to outperform if conditions start to stabilize.
To shift sentiment the company will need to deliver on three areas:
- stabilisation of Wegovy demand
• successful expansion into high volume programs such as Medicare, TrumpRx and lower priced tiers
• a competitive pipeline, especially the oral obesity drug expected in 2026 and future CagriSema development
If these elements strengthen, today’s valuation may prove overly pessimistic.
4. Will the Stock Recover or Fall Further?
The future direction of the share price will depend on several factors, but the situation is now more defined than earlier in the year. The main challenges, weaker US demand, stronger competition and a narrowed full year outlook are already known and reflected in the share price. The focus now shifts to how Novo Nordisk manages the next stage.
What will investors look in the near future:
• updates on Wegovy demand in the United States
• the scale of compounded GLP 1 use
• any adjustments to 2025 guidance
These areas still influence how quickly performance in the US market can stabilize.
Looking further ahead, several milestones could shape the medium term outlook, although most of them fall in 2026 or later:
- the launch of the oral obesity drug
• regulatory decisions that affect pricing or access
• expansion into large volume programs such as Medicare
• new clinical data from pipeline candidates
Novo Nordisk ($NVO) remains a significant global player with strong financial performance, but the environment around it has become more complex. Competition, pricing pressure and regulatory factors are likely to continue affecting the stock as new information emerges. The overall direction is open, and the next phase will depend on company execution and broader market conditions.
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