Novo Nordisk plummets on the inventory market as a result of poor outcomes of the trials of one in every of its medicine in opposition to Alzheimer’s | Companies | EUROtoday

New punishment for Novo Nordisk. The Scandinavian firm acknowledged this Monday that an older oral model of its drug semaglutide has not achieved its most important goal in late-stage scientific trials testing whether or not this drug can delay cognitive decline in Alzheimer’s sufferers.

Following the announcement, the Danish firm’s shares have suffered a brand new punishment, falling greater than 12%, to 266.90 crowns, their lowest worth for the reason that summer time of 2021. Since the start of the 12 months, the shares have misplaced greater than 55% of their worth amid a severe disaster at Novo Nordisk, which is affected by robust competitors in the important thing section of anti-obesity remedies.

The punishment of Novo Nordisk, as soon as a European star within the monetary markets, contrasts with the sturdy rise of its American rival Eli Lilly which, on the finish of final week, grew to become the primary pharmaceutical firm to surpass the trillion-dollar mark in market capitalization. The shares of the American pharmaceutical firm soar 36% this 12 months after rising 32% in 2024, given the expansion prospects of its medicine known as GLP-1, used to deal with weight problems and diabetes.

In relation to proof on Alzheimer’s, Novo Nordisk has famous that sufferers who’ve taken the drug haven’t skilled slower development of their illness, in line with a cognitive evaluation. The firm has introduced that it’s going to droop the deliberate extension of the research scheduled for one 12 months.

In this sense, the information from the studies was key for Novo, since Alzheimer’s illness would characterize a brand new and necessary marketplace for GLP-1 medicine akin to semaglutide, after its success within the therapy of weight problems and diabetes. And all in an space like Alzheimer’s sufferers, who’ve very restricted therapy options.

The drug being examined is Rybelsus, a pill authorized just for the therapy of sort 2 diabetes. Both Rybelsus, Ozempic and Wegovy are based mostly on the identical energetic ingredient, semaglutide, a GLP-1 drugs. “While semaglutide did not demonstrate efficacy in slowing the progression of Alzheimer’s disease, the extensive evidence supporting it continues to provide benefits to people with type 2 diabetes, obesity and related comorbidities,” stated Novo Nordisk Chief Scientific Officer Martin Holst Lange.

The Danish firm is concerned in a drastic restructuring, which impacts each the highest administration and the board of administrators, with the intention of getting out of the operational disaster wherein it’s immersed. Within its newest actions, Novo Nordisk opened a takeover battle with Pfizer for management of the start-up American Metsera, which develops new anti-obesity medicine. Finally, after the presentation of various presents, Pfizer was the winner, with an settlement that valued Metsera at greater than 10 billion {dollars}.

Different analysts have commented on Novo Nordisk’s announcement. BMO Capital Markets has famous that the trials had at all times been riskier, given the “limited understanding of the etiology of Alzheimer’s disease and how GLP-1 could help slow the progression. These analysts believe that Monday’s failure could cause a greater disadvantage, to which is added the failed acquisition of Metsera and the cuts in forecasts. In this sense, in early November, the pharmaceutical company announced a growth in operating profits for the whole year, in local currencies, of between 4% and 7%, compared to a previous estimate of between 4% and 10%.

Jefferies, for its part, has stated that, although hopes were not high for a positive result, the potential for a possible success maintained the interest of some investors. The firm warns that investors are “unlikely to rush back into Novo Nordisk shares.”

JP Morgan described the fall in the Novo Nordisk stock market in this Monday’s session as an over-reaction, while Bloomberg Intelligence highlighted that, although the result is discouraging, the indication of the benefit of the treatment for Alzheimer’s had been considered an “additional profit.”