Eli Lilly Faces Competitive Pressure as Novo Nordisk Gains First-Mover Advantage in Oral Weight-Loss Market

Eli Lilly US5324571083

The competitive landscape in the lucrative GLP-1 obesity treatment sector shifted significantly in late December. Novo Nordisk secured U.S. regulatory approval for the first oral version of its weight-loss medication, Wegovy (semaglutid), presenting a strategic challenge to its main rival, Eli Lilly.

On December 23, the U.S. Food and Drug Administration (FDA) granted approval for Novo Nordisk's oral tablet. The Danish pharmaceutical giant plans to launch this needle-free GLP-1 weight reduction treatment in the United States starting January 2026, with a monthly price set at $149. Clinical trial data indicates the therapy achieves an average weight reduction of 16.6%. Following this news, Novo Nordisk's share price surged more than seven percent, while Eli Lilly's equity experienced a slight decline.

The market's reaction highlights a key timing disadvantage for Eli Lilly. Its own oral candidate, Orforglipron, remains in late-stage development and regulatory review. Approval is not anticipated until the first half of 2026, placing its market entry several months after Novo Nordisk's product launch. This head start allows Novo Nordisk to capture early market share and attract patients who are averse to injectable therapies.

Underlying Strength for Eli Lilly

Despite this competitive setback, Eli Lilly's fundamental market position remains robust. The company continues to dominate with its injectable blockbuster drugs, Mounjaro and Zepbound. For the third quarter of 2025, Eli Lilly reported a substantial 53.9% increase in revenue, reaching $17.6 billion.

Analyst sentiment reflects this underlying strength. On December 22, Zacks Research raised its 2027 earnings per share estimate for the company to $41.37, citing a strong product pipeline and operational efficiency. On average, analysts maintain a "Moderate Buy" rating on the stock, with a consensus price target of approximately $1,155. This represents a potential upside of seven to eight percent from current trading levels.

The GLP-1 market, effectively a duopoly shared by Eli Lilly and Novo Nordisk, is projected by Morgan Stanley to expand to $150 billion by 2035. Consequently, any innovation by one competitor is closely scrutinized for its potential to alter the balance of power within this high-growth sector.

Market Performance and Future Catalysts

From a technical perspective, Eli Lilly's stock is currently testing a support level around $1,060. The long-term upward trend remains intact, with the recent price action resembling a consolidation phase rather than a definitive trend reversal.

The speed of Eli Lilly's regulatory progress with Orforglipron is now a critical focus for investors. The company's oral formulation is based on a smaller molecule than Novo Nordisk's peptide-based pill, which could potentially offer manufacturing cost advantages. The next scheduled quarterly earnings report is set for February 11, 2026. Until then, investor attention is likely to remain fixed on any regulatory updates concerning the company's oral tablet candidate.