Novo Nordisk Loses Ground to Eli Lilly as Rebrand and Buybacks Buy Time Before London Strategy Day

Novo Nordisk rebrands as Lilly captures 60.9% of the obesity drug market; Morgan Stanley cuts to DKK 250 ahead of the September 21 capital markets day.

Novo Nordisk's grip on the obesity drug market is loosening, and the Danish company is responding with a sweeping makeover of both its public image and its internal culture. According to data from IQVIA, US rival Eli Lilly captured 60.9 percent of the obesity medication market in the second quarter, leaving Novo with just 38.8 percent.

The company will now trade on everyday terms as simply Novo, though its legal entity remains Novo Nordisk A/S. Chief executive Mike Doustdar told CNBC that the brand refresh and the cultural overhaul are two halves of the same effort to rethink the company's approach in the obesity race. A new internal framework called "The Novo Way" is meant to streamline workflows and speed up sales execution.

Not everyone is convinced the cosmetic changes address the real problem. Evan Seigerman, an analyst at BMO, cautioned that a purely visual adjustment risks distracting from operational challenges, and that a durable turnaround will require concrete action in the core business.

Oral Market Heats Up as Lilly Closes In

The pressure is most acute in oral formulations. Novo's Wegovy pill racked up more than three million prescriptions in the US through June, but Lilly's oral product Foundayo, launched in early April, is gaining fast — the US company says more than 30 percent of its new patients are already opting for the pill.

Alongside the repositioning, Novo is tidying up its development pipeline. The company confirmed yesterday that its collaboration with Danish biotech Ascendis Pharma has ended. Ascendis regains full worldwide exclusive rights to its TransCon technology for metabolic and cardiovascular indications, including a development program for a once-monthly semaglutide formulation. The split leaves no outstanding financial obligations on either side. The news landed barely a week after Novo disappointed investors by halting Phase 3 trials of its hoped-for candidate Ziltivekimab.

Morgan Stanley Cuts as Semaglutide Cliff Looms

Market sentiment has been cooling for some time. Last Friday, Morgan Stanley downgraded the stock and set a price target of 250 Danish kroner, citing the risk of a marked growth slowdown through 2031 — the year semaglutide is expected to lose market exclusivity. The blockbuster accounts for roughly 75 percent of revenue in the current 2026 fiscal year, and in the analysts' view, new product candidates may not be enough to fully offset the coming shortfall.

Other houses take a somewhat brighter view on valuation. HSBC nudged its target up to 320 Danish kroner on September 9 while keeping a "Hold" rating on the shares.

Buyback Program Offers a Floor

A steadying force comes from the company's sizable repurchase effort. Under the current twelve-month program, more than 9.3 billion Danish kroner had been spent on B-shares by September 11, leaving the group holding 1.1 percent of its share capital.

The stock edged higher in today's session, adding 1.9 percent to close at EUR 37.76. Since the start of the year, however, the shares remain down 14 percent, and they sit 31 percent below their 52-week high of EUR 54.86.

With all of this as a backdrop, the capital markets day scheduled for September 21 in London has taken on outsized importance. Management must show how the cultural reset translates into sustainable operating growth, and investors are demanding specifics on how the company intends to defend market share against its US competitor.