(BFM Bourse) – The Danish pharmaceutical laboratory, the largest market capitalization in Europe, fell by more than 20% in Copenhagen. Efficacy data for its drug candidate Cagrisema came in below expectations.
Novo Nordisk may well be the largest European group on the stock market, ahead of LVMH, but its action nonetheless remains vulnerable to data on its clinical trials, like a simple biotech.
Proof of this is this Friday, March 20. The action of the Danish pharmaceutical company fell by 21% in Copenhagen at the start of the afternoon, erasing between 80 and 90 billion euros of market capitalization.
The company suffered from disappointing results in a phase III clinical trial (the last stage before the potential marketing of a product), a phase which evaluates the effectiveness of a drug candidate, compared to a reference treatment or a placebo.
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Weight loss not as frequent as hoped
This clinical trial focused on Cagrisema, a potential new anti-obesity treatment from the Danish group, which combines two molecules to reduce blood sugar, namely semaglutide and cagrilintide.
Cagrisema was evaluated against semaglutide alone, cagrilintide alone and placebo. The clinical trial cohort brought together 3,417 people who were obese or overweight.
Ultimately, the results of this trial showed that 22.7% of patients treated with Cagrisema experienced significant weight loss after 68 weeks, compared to 11.8% for those treated with cagrilintide, 16.1% with semaglutide and 2.3% with placebo.
Taking the total population, with patients who abandoned treatment during the course, the rate falls to 20.4% compared to 11.5% for cagrilintide, 14.9% for semaglutide and 3% for placebo.
Eli Lilly pounces
However, these data remain below the company's objectives, which aimed for a rate above 25%, according to Stifel.
In a note published Monday, Bank of America warned that a rate below 25% would be a disappointment for the market. UBS, for its part, carried out a survey in October showing that 50% of investors expected a rate higher than 25% for significant weight loss. The bank itself assigned a probability of 70% to a rate greater than or equal to 25%.
In a comment sent to CNBC, Novo Nordisk assured that Cagrisema had outperformed Wegovy, the Danish group's already approved anti-obesity drug, in terms of weight reduction, and that its performance was “comparable to that of best-in-class treatments “.
Upon the announcement of these clinical results, Eli Lilly, Novo Nordisk's rival in anti-obesity and anti-diabetes drugs, jumped 8.4% on Wall Street.
Cagrisema constitutes the main focus of the market in Novo Nordisk's pipeline of drug candidates.
Important promises
Barclays explained in a recent note that the two currently approved anti-obesity treatments, namely Wegovy from Novo Nordisk and Zepbound from Eli Lilly, show significant weight reduction rates of 15% and approximately 20%, respectively, after 68 weeks. A rate of 25% would therefore have constituted a significant improvement and a strong risk for Eli Lilly. “If successful, Cagrisema would therefore significantly broaden the audience for weight loss medications,” summarized Barclays.
Stifel estimated, however, that a rate of 26% would have marked “a clearer victory” over Eli Lilly's anti-obesity drug than a rate of 25%.
Barclays has also estimated peak potential sales of Cagrisema at $49 billion in 2038, compared with a forecast of $25 billion in sales in 2025 for Ozempic and Wegovy, Novo Nordisk's two flagship treatments against, respectively type 2 diabetes and obesity.
Demand for this type of drug has soared in recent quarters, particularly in the United States. Over the first nine months of 2024, Ozempic's sales jumped 32% year-on-year and those of Wegovy by 76%. These sales, combined, represented 17 billion US dollars.
The success of these drugs allowed Novo Nordisk to become the largest European capitalization last year, dethroning LVMH.
Julien Marion – ©2024 BFM Bourse
