Novo Nordisk’s Buyback Blitz Can’t Mask the Pill-Price Squeeze Ahead of Q1

Novo Nordisk's new oral obesity pill sees strong demand but low pricing threatens revenue, while Eli Lilly's rival drug and generic competition add pressure ahead of Q1 results.

Novo Nordisk has just spent 3.8 billion Danish kroner hoovering up nearly 14.8 million of its own B-shares, a move that briefly steadied a stock down 14% since January. But as the Danish drugmaker prepares to unveil its first-quarter numbers on Wednesday morning, the buyback looks more like a band-aid than a cure. The real story is playing out in US pharmacies, where the company’s new oral weight-loss drug is flying off the shelves—but at a price that threatens to torpedo revenue expectations.

The pill, launched in January as the first GLP-1 oral treatment for obesity, racked up roughly 721,000 prescriptions in its debut quarter, according to IQVIA data. Within weeks, it had captured a third of all new prescriptions in the segment. On the surface, that’s a blockbuster start. Peel back the layers, though, and the numbers get uncomfortable. A hefty chunk of those scripts are for the low-dose starter pack, priced at just $149 a month. Analysts at BMO Capital Markets now warn that quarterly pill sales could fall well short of the $1 billion consensus estimate.

That pricing headache is only the beginning. The brief window Novo Nordisk enjoyed as the sole player in the oral obesity market slammed shut in April, when Eli Lilly won approval for its rival pill, Foundayo. In the last week of April, the Wegovy pill still commanded roughly 135,000 prescriptions, while Foundayo managed just 3,700 in its second week on the market. The gap is wide, but the trajectory is clear: competition is coming, and it’s coming fast.

Meanwhile, the pressure isn’t limited to the pill. Generic manufacturers are chipping away at the injectable Wegovy franchise in India, China, and Canada, as patents on semaglutide begin to expire in international markets. To shore up its defences, Novo Nordisk is racing to bring an oral version of Ozempic to US pharmacies for adults with type-2 diabetes, leaning on a broad network of pharmacy and telemedicine partners to secure distribution.

The company’s own guidance already signals pain ahead. Management forecasts a currency-adjusted decline in both revenue and operating profit of between 5% and 13% for the full year, excluding a one-off hit from US rebates. That’s a stark reversal for a stock that had been one of Europe’s most dependable growth stories.

Wall Street is bracing for a miss. Analysts expect first-quarter revenue of $11.13 billion and earnings per share of $0.87. Novo Nordisk has historically impressed with cost discipline but has repeatedly stumbled on the top line. Bernstein Research recently slapped an “underperform” rating on the shares with a price target of 175 Danish kroner. Citigroup cut its target to 275 kroner, though it kept a neutral stance.

The stock has clawed back some ground from its late-March trough of €30.48, rising to €38.38 on a 9% weekly gain, helped by the buyback announcement. But the chart is fragile. If Wednesday’s numbers—due at 07:30 CET—confirm the weak outlook, the shares could easily retest that year-low support level.

Beyond the earnings release, investors have another catalyst to watch. From May 12 to 15, Novo Nordisk will present fresh clinical data at the European Congress on Obesity in Istanbul. Those results will shape the narrative on whether the company can defend its long-term leadership in a market that is suddenly crowded, price-sensitive, and far less forgiving.