Novo Nordisk (NYSE:NVO) is losing ground in Europe’s red-hot market for weight-loss and diabetes drugs.
Its rival, Eli Lilly and Co (NYSE:LLY) is racing ahead, and investors are taking notice.
Despite the setback, Morgan Stanley has raised its price target on Novo shares to DKr550, up from DKr441.20, signalling confidence in the Danish group’s recovery as supply issues ease and new product launches gather pace.
Fresh data from IQVIA show Novo’s share of the European market for weekly GLP-1 injections fell to 53% in May, down from 68% in February 2024.
Eli Lilly’s Mounjaro, used to treat both diabetes and obesity, is now the top seller in Germany and the UK, and is gaining ground fast in Spain.
The shake-up is being driven by higher-priced drugs. Both Mounjaro and Novo’s Wegovy cost between €200 and €300 per month, far more than older options such as Ozempic and Trulicity.
That means the shift in market share is hitting Novo where it matters most: revenue.
“The market share gain from Eli Lilly is driven by product differentiation and commercial execution rather than product supply or availability,” said Morgan Stanley analysts.
Novo’s Ozempic saw a rebound in April and May, suggesting improved availability.
Wegovy and Mounjaro are still in the early stages of rollout in France and Italy, where uptake is starting to climb.
Morgan Stanley expects Novo to grow sales by 14% this year and operating profit by 17%.
In afternoon trading, the shares were flat at DKr440.70.