Novo Nordisk's European Breakthrough Tempered by Growing Generics Threat in Brazil and Beyond

France will publicly reimburse Wegovy and Mounjaro, and EMA backs new oral and high-dose versions, but Brazil's first homegrown semaglutide threatens pricing power.

Novo Nordisk finds itself straddling two very different realities this week. In Europe, the Danish drugmaker has secured a series of regulatory wins that could unlock significant new demand for its blockbuster weight-loss drug Wegovy. Yet halfway around the world, Brazil has just cleared the first homegrown competitor to Ozempic, underlining how quickly the patent protection that underpins Novo’s pricing power is fraying outside its core Western markets. The stock, which closed Friday at €39.05, remains down roughly 44% from its 52-week high despite a 13% rebound over the past month.

France flips the switch on public reimbursement

France will become the first EU country to cover Wegovy and Eli Lilly’s Mounjaro through its statutory health insurance system, starting June 15. Health Minister Stéphanie Rist confirmed the move, which targets patients with a BMI of 35 or higher plus a comorbidity, or a BMI of at least 40 regardless of other conditions. The standard reimbursement rate is 65%, but the minister noted that most patients will qualify for full 100% coverage due to their accompanying illnesses.

The French health ministry estimates the programme will cost roughly €100 million a year at full rollout, reaching around one million people. For context, patients in France currently pay about €300 a month out of pocket for these treatments.

EMA committee backs two new Wegovy formulations

Parallel to the French decision, the European Medicines Agency’s CHMP committee issued positive opinions on two new Wegovy variants — an unusual double win that carries strategic weight for Novo Nordisk.

The committee recommended approval of an oral version of semaglutide: a 25 mg tablet taken once daily. In the OASIS-4 trial, patients achieved an average weight loss of 16.6%. If final EU approval follows, it would be the first oral GLP-1 receptor agonist for weight management in Europe.

At the same time, the high-dose injectable Wegovy 7.2 mg received a favourable CHMP review. The STEP-UP study showed an average weight loss of 20.7%, with roughly one in three participants losing at least a quarter of their body weight.

Novo plans to launch the tablet in select markets outside the US during the second half of 2026, with the high-dose injection following as a single-dose pen in the third quarter of the same year. The US experience already demonstrates commercial viability: over one million Americans started taking oral Wegovy within four months of its launch, and the retreat of compounded semaglutide products is giving Novo additional breathing room.

Brazil punches a hole in Novo’s patent wall

The good news from Europe is, however, shadowed by developments in Latin America’s largest economy. Brazilian health regulator Anvisa has approved Ozivy, the first injectable semaglutide analogue produced locally, developed by pharmaceutical company EMS. Ozempic lost patent protection in Brazil in March, and EMS plans to price Ozivy about 30% cheaper than the original.

EMS expects to launch within 30 days, manufacturing 350,000 pre-filled pens in three dosages in its first phase. The company targets 1.2 million units sold and more than 500 million reais in revenue during the first year.

Brazil is not an isolated case. Generics hit the Indian market in March, prompting Novo Nordisk to cut prices there. Canada has also authorised copycat versions. Together, India, China, Brazil, Turkey, South Africa and Canada represent a vast population base and a growing share of future demand for obesity and diabetes treatments. The gradual erosion of patent protection in these markets threatens not just specific sales but the global pricing architecture around semaglutide.

Analysts stay on the sidelines despite a solid quarter

The mixed picture has kept most sell-side analysts cautious. Of 19 houses covering the stock, 13 rate it a Hold or Neutral. Deutsche Bank’s Emmanuel Papadakis has a Neutral stance and a price target of DKK 290, while Jefferies’ Michael Leuchten also sticks with Neutral at DKK 270. The seven US banks — Bernstein, BMO Capital, Goldman Sachs, Morgan Stanley, JP Morgan, Citigroup and TD Cowen — average a target of DKK 247, with uniformly Hold or Sell ratings.

Operationally, the first quarter provided a floor: adjusted operating profit came in at DKK 32.86 billion, well above the consensus estimate of DKK 28.74 billion. Yet management’s full-year guidance remains defensive. For 2026, Novo expects currency-adjusted revenue and operating profit to decline between 4% and 12%, a corridor that was only slightly narrowed in May. The impact of the US 340B drug pricing programme is stripped out of the numbers.

The company continues to buy back shares. A programme totalling up to DKK 15 billion over 12 months is under way, and as of May 22, Novo had repurchased 17.05 million B-shares at an average price of DKK 262.22, worth roughly DKK 4.47 billion. Such buybacks offer technical support but do not resolve the core question: can pipeline innovation and pricing discipline compensate for the mounting generic threat?

Key catalysts loom on the horizon

The immediate test arrives on June 7, when Novo presents its research and development strategy at the American Diabetes Association conference in New Orleans. Investors will focus on new data for CagriSema, the next big hope in the pipeline, and any update on the FDA’s expected approval decision later this year. Half-year results due on August 5 will provide the next concrete financial checkpoint.

For now, Novo Nordisk is balancing a regulatory tailwind in Europe with a steady headwind in emerging markets. The ADA conference will show whether the science can match the scale of the challenge.