The golden era of the GLP-1 monopoly has ended. Novo Nordisk (NVO) learned this the hard way on February 3 when its market capitalization evaporated in a single trading session. The Danish drugmaker, once the undisputed king of the weight-loss revolution, saw its shares plunge nearly 15 percent following a guidance update that can only be described as a surrender. Investors who rode the Wegovy wave to record highs are now staring at a bleak 2026 outlook. Management expects both sales and operating profit to decline by as much as 13 percent this year. This is not a supply problem. This is a pricing war.
The Guidance Shock and the Margin Squeeze
Novo Nordisk reported its full-year 2025 results with a mix of surface-level growth and structural decay. Sales grew 10 percent to 309 billion Danish kroner, but the underlying metrics tell a darker story. Gross margins have compressed from 84.7 percent in 2024 to 81 percent. The culprit is a massive pricing reset in the United States. Per Morningstar’s updated fair value analysis, the firm is facing a rare top-line decline as it prioritizes volume over per-unit profit. The market’s reaction was swift. The ADR price dropped to approximately $47, a level not seen since the early hype cycles of 2023.
The Trump Pricing Reset and TrumpRx
Political pressure has finally pierced the pharma bubble. In late 2025, Novo Nordisk struck a deal with the Trump administration to drastically lower the costs of semaglutide. Under the Most Favored Nation (MFN) policy, the monthly cost of Wegovy and Ozempic was slashed from over $1,000 to an average of $350 for those using the new TrumpRx.gov platform. This was the “painful” investment CEO Mike Doustdar referenced in his recent CNBC interview. The company is betting that lower prices will be offset by a massive influx of new patients, but the immediate financial hit is undeniable. The provision reversal of $4.2 billion related to the 340B Drug Pricing Program only adds to the accounting complexity that has spooked institutional desks.
The Oral Wegovy Paradox
Technological innovation has become a double-edged sword. The December 2025 FDA approval of Wegovy in pill form was supposed to be a victory lap. Instead, it has accelerated the cannibalization of higher-margin injectables. The pill launched with a starting price of $149 per month for cash payers through Amazon Pharmacy. While the uptake has been explosive with over 170,000 prescriptions in the first month, the revenue per patient is a fraction of the injectable version. This is the technical mechanism of the margin collapse. Novo is effectively trading its premium injectable business for a mass-market oral business where it faces looming competition from Eli Lilly’s orforglipron, which is expected to hit the market in the second quarter.
The Lilly Hegemony
Eli Lilly (LLY) has emerged as the clear victor in the 2026 opening salvo. While Novo issued a profit warning, Lilly reported blowout Q4 results on February 4. Lilly’s U.S. GLP-1 market share has climbed to 60.5 percent, leaving Novo with just 39.1 percent. Lilly’s dual-agonist approach with tirzepatide (Zepbound/Mounjaro) continues to show superior clinical efficacy in weight loss compared to Novo’s semaglutide. Furthermore, Lilly’s aggressive manufacturing expansion has allowed it to meet demand that Novo is still struggling to fulfill at the fill-finish level. The divergence in fortunes is stark. Lilly is now a trillion-dollar company while Novo is fighting to maintain its status as Europe’s most valuable firm.
Comparative Performance and Outlook
The following table illustrates the dramatic shift in Novo Nordisk’s financial health as it enters the 2026 fiscal year.
| Metric | 2025 Actual | 2026 Guidance (Adjusted) |
|---|---|---|
| Sales Growth (CER) | +10% | -5% to -13% |
| Operating Profit Growth | +6% | -5% to -13% |
| Gross Margin | 81% | Further Compression Expected |
| Wegovy Pill Monthly Cost | N/A | $149 – $299 |
| Injectable Wegovy (TrumpRx) | $1,000+ | $350 |
The next major milestone is the mid-2026 expansion of Medicare coverage. For the first time, millions of older Americans will have access to obesity drugs with a capped $50 monthly copay. This will test Novo’s volume thesis to its limit. If the company cannot convert this massive increase in patient access into meaningful net income growth, the 2026 price reset may become a permanent valuation ceiling. Watch the 50,000 weekly prescription mark for the oral Wegovy pill as a lead indicator for the Q1 2026 earnings report on May 6.
