Difficult to swallow…Until Now-History in Tablet Form

Novo Nordisk (NVO) FDA Approval of Oral Wegovy- a defining moment for Obesity Pharmacology

Investment View: STRATEGIC POSITIVE / STRUCTURAL INFLECTION POINT
Sector: Global Pharmaceuticals – Metabolic & Obesity
Catalyst: FDA approval of first-ever oral GLP-1 weight-loss therapy

Executive Summary

The US FDA approval of oral Wegovy (semaglutide) marks a historic inflection point for obesity treatment and for Novo Nordisk’s long-term competitive positioning. This is the first effective, scalable, regulator-approved weight-loss pill ever brought to market, a milestone the industry has chased unsuccessfully for over two decades.

From an equity perspective, this approval materially de-risks Novo Nordisk’s obesity franchise, re-opens a path to market share recovery versus Eli Lilly, and expands the total addressable market by lowering psychological and logistical barriers associated with injectables. This is important following the major decline in Novo Nordisk’s share price over the past six months especially following the disappointing Phase 3 results for oral semaglutide (Rybelsus) in Alzheimer trials (EVOKE/ EVOKE+) and lacklustre results of oclacitinib’s Phase 3 trial for Chronic Kidney Disease. The final nail in the post which catapulted negative market sentiment was being ‘under’ bid for obesity focused biotech company Metsera by Pfizer.

Having covered Novo Nordisk as an equity analyst at Merrill Lynch, UBS and Bear Stearns, and having personally attended FDA advisory panels during the rimonabant era at Sanofi-Aventis, it is difficult to overstate the significance of this moment. This is not “another formulation.” It is the moment the obesity drug category graduates from niche to mass-market chronic therapy.

Why This Matters: Industry Context

A Long History of Failure

For decades, weight-loss pills have represented the “holy grail” of metabolic medicine:

• Sanofi-Aventis’ rimonabant failed spectacularly due to psychiatric safety concerns despite promising efficacy.
• Pfizer, Amgen, and Roche have all abandoned obesity pill programmes in recent years following disappointing efficacy, tolerability, or safety profiles.
• Regulatory risk has historically been existential rather than incremental.

I vividly remember sitting in FDA advisory committee meetings during the rimonabant review—where optimism gave way to an abrupt reassessment of risk tolerance. Since then, obesity pills became uninvestable science projects in most sell-side models.

That context is essential: oral Wegovy breaks a 20-year industry deadlock.

What Has Changed: The Science Finally Works

Novo Nordisk’s oral Wegovy uses semaglutide, the same proven GLP-1 molecule underpinning:

• Wegovy
• Ozempic

The oral formulation achieved:

• ~17% mean body-weight reduction at 64 weeks
• Clinically meaningful efficacy approaching injectable GLP-1s
• A safety profile regulators are now comfortable approving for chronic use

By comparison:

• Zepbound (injectable, Eli Lilly): ~20.2% at 72 weeks
• Lilly’s oral candidate (orforglipron) is still awaiting FDA approval

This positions Novo as first-mover in the next competitive frontier: oral obesity pharmacotherapy.

Commercial Implications

1. Market Expansion, Not Just Share Shift

Many patients:

• Will not self-inject
• Delay or refuse treatment despite medical eligibility
• Drop off injectable regimens over time

An oral option expands demand elasticity, bringing in:

• Earlier-stage patients
• Weight-conscious but injection-averse consumers
• Primary-care-driven prescribing rather than specialist bottlenecks

Novo’s US EVP Dave Moore captured this precisely: the pill reaches patients “who may not have sought or accepted treatment before.”

2. Pricing Surprise: Lower Than Expected

Novo announced a $149/month price point, following negotiations with the Trump administration—dramatically below prior expectations and broadly aligned with future oral GLP-1 pricing.

This has three equity-positive implications:

• Accelerates payer adoption
• Reduces political risk
• Forces competitors into margin trade-offs

The White House has indicated that future obesity pills, including Lilly’s, will also converge toward this price point—confirming Novo has reset the industry pricing anchor.

Competitive Landscape: Novo vs Lilly

Factor	Novo Nordisk	Eli Lilly
First oral approval	Yes	Pending
Molecule	Semaglutide	Orforglipron / Tirzepatide
Weight loss	~17%	~20%
Manufacturing readiness	January launch	TBD
Recent momentum	Recovering	Strong

While Eli Lilly has enjoyed recent share gains due to injectable demand, oral Wegovy gives Novo Nordisk a critical strategic reset.

This is not about winning on peak efficacy alone—it is about winning on access, scale, and chronic adherence.

Near-Term Financial Read-Through

• Offsets recent guidance softness driven by slower-than-expected Wegovy/Ozempic sales
• Supports re-acceleration of obesity revenue growth into 2025
• Enhances lifecycle value of semaglutide well beyond patent optics

Importantly, this approval reduces binary R&D risk and replaces it with execution risk, which Novo historically manages well.

Why This Is a ‘Big Moment‘

From an analyst’s perspective, moments like this are rare:

• Comparable to the first statins
• Comparable to the first oral contraceptives
• Comparable to early HIV combination therapy

For obesity, this is the moment the category moves from medical breakthrough to everyday medicine.

After decades of false starts, safety failures, and regulatory skepticism, the FDA has now approved the first genuinely effective weight-loss pill.

That is not incremental.
That is category-defining.

Bottom Line

Oral Wegovy is a milestone approval: scientifically, commercially, and historically.

Novo Nordisk now:

• Regains strategic initiative
• Expands the obesity market rather than just competing within it
• Establishes first-mover advantage in a segment rivals have chased and abandoned

For long-term investors, this approval meaningfully strengthens the durability of Novo’s growth story and reshapes the competitive dynamics of obesity therapeutics for the next decade.

This is the one analysts will remember.