Novo Nordisk Stock Plummets: Jefferies Predicts Double-Digit Drop After Obesity Data Disappointment
Novo Nordisk’s (NVO) shares took a significant hit today, plummeting nearly 20% in premarket trading, following disappointing Phase III obesity data for its CagriSema drug. Jefferies analyst Peter Welford expressed disappointment, stating that the 20.4% absolute weight loss observed fell short of market expectations, which ranged from 25%-27%.
Tolerability Concerns Raise Red Flags
Adding to investor concerns, Welford highlighted potential tolerability issues, suggesting patient adherence data indicates challenges in this area. While Jefferies acknowledged that gastrointestinal tolerability appeared similar to Wegovy, the overall impact on weight loss fell short of projections.
Jefferies Downgrades, Predicts Further Decline
Jefferies, previously bullish on Novo Nordisk, downgraded its rating to Underperform, citing the disappointing data. Their peak sales forecast for CagriSema stands at $7.75 billion, significantly lower than the consensus estimate of $20 billion or more. Welford predicts Novo Nordisk shares will drop "at least" 10%-15% following the news.
Investors React, Stock Price Drops Sharply
The market reacted swiftly, sending Novo Nordisk’s share price down 19%, or $19.84, to $83.60 in premarket trading.
Looking Ahead: Uncertainty Remains
While the initial reaction to the CagriSema data has been negative, it remains to be seen how the long-term impact will unfold. Investors will be closely watching for further developments and clarifications from Novo Nordisk regarding the drug’s efficacy and tolerability profile.
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