'One Pen Costs 370,000 Won': Stronger Rivals Arrive... Fierce Competition for Oral Weight Loss Drugs [Business & Issue]

Novo Nordisk Stock Rebounds After Sharp Decline
Eli Lilly’s Oral Obesity Drug Disappoints on Efficacy
Oral Wegovy Enters Approval Process Amid Intensifying Competition

Reuters Yonhap News

The stock price of Novo Nordisk, the developer of the obesity treatment Wegovy, had been on a steady decline since the beginning of the year but is now showing signs of recovery. This turnaround is attributed to the disappointing efficacy of Eli Lilly's oral obesity treatment, which had emerged as a strong competitor. As a result, it is now expected that Wegovy's dominance will not be immediately threatened. Novo Nordisk has also begun the approval process for an oral version of Wegovy, and as many pharmaceutical companies are entering the market for oral obesity treatments, competition is expected to intensify in the future.

Novo Nordisk Stock Rebounds... Still Down by Half Compared to Early This Year

On August 28 (local time), Novo Nordisk's stock closed at 358.80 Danish kroner (DKK) on the Copenhagen Stock Exchange. This marks a 23.9% rebound from its yearly low of 289.50 kroner recorded on August 6. The stock had fallen by 54.7% from 638.80 kroner at the start of the year to August 6, but has now entered a recovery phase after eight months of decline.

The main reason for the sluggish stock performance earlier this year was the threat to Wegovy's market share posed by Eli Lilly's oral obesity treatment, Orforglipron, which succeeded in Phase 3 clinical trials. Compared to the injectable Wegovy, Orforglipron is an oral medication that can be taken once daily without restrictions on food or water intake, highlighting its convenience.

However, the Phase 3 clinical trial results for Orforglipron, announced on August 7, showed an average weight loss of only 12.5% over a 72-week treatment period, falling short of the market's expectation of 15%. In contrast, Wegovy demonstrated an average weight loss of 14.9% over a 68-week period, indicating higher efficacy. As a result, Novo Nordisk's stock price began to recover.

Wegovy vs. Mounjaro: Fierce Battle for the Obesity Treatment Market

Aside from oral obesity treatments, Novo Nordisk's injectable Wegovy and Eli Lilly's injectable Mounjaro are already engaged in fierce competition in the market.

Wegovy is an injectable medication using semaglutide, a drug originally developed for type 2 diabetes, and is administered once a week. The diabetes treatment using the same ingredient is sold under the brand name Ozempic. Semaglutide is known to act on the appetite center in the brain, suppressing appetite and delaying gastric emptying, which enhances satiety. It has gained popularity for offering approximately twice the weight loss effect compared to Saxenda, Novo Nordisk's previous obesity treatment. When launched in October last year, the supply price was set at 370,000 won per injection pen, regardless of dosage.

Eli Lilly's Mounjaro is also an injectable medication, using tirzepatide, another type 2 diabetes treatment ingredient. While its mechanism of action differs in detail from semaglutide, it also suppresses appetite to induce weight loss. Like Wegovy, it is administered once a week. Clinical trials showed that Mounjaro led to an average weight loss of 20.2% over a 72-week treatment period, indicating a greater weight loss effect than Wegovy. Upon its domestic launch on the 20th, the supply price varied by dosage: 278,000 won per pen for the initial 2.5 mg dose and 369,000 won per pen for the 5 mg dose.

Reuters Yonhap News

In the U.S. obesity treatment market, the latecomer Mounjaro is gradually overtaking Wegovy. According to CNBC, as of the first quarter of this year, Mounjaro held a 53.3% market share in the U.S. obesity drug market, while Wegovy accounted for 46.1%. Wegovy was launched in the U.S. in June 2021, and Mounjaro in November 2023. At the time of launch, Wegovy commanded over 70% of the U.S. market share.

A major shift is also expected in the domestic market. Until now, Wegovy has dominated the domestic obesity treatment market. Immediately after its domestic launch in October last year, Wegovy captured a 63.4% market share, which rose to 82% in the second quarter of this year.

Oral Wegovy Enters Approval Process... Fierce Competition for Oral Obesity Drugs

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The competition between the two companies is expected to continue with oral obesity treatments. With Eli Lilly having completed Phase 3 clinical trials for its oral obesity drug and taking the lead, Novo Nordisk has also applied for new drug approval for oral Wegovy and is actively pursuing the development of other obesity treatments.

According to CNN, the U.S. Food and Drug Administration (FDA) began reviewing the new drug application for oral Wegovy in early May. The application seeks approval for use in chronic weight management for adults, as well as for reducing the risk of major adverse cardiovascular events (MACE) in overweight, obese, and cardiovascular disease patients. If approved by the FDA, sales could begin early next year. Separately, Novo Nordisk is also developing a new obesity treatment called Amycretin as a follow-up to Wegovy. Amycretin, which has completed Phase 2 clinical trials, is being developed in both injectable and oral forms.

Global pharmaceutical companies beyond Eli Lilly and Novo Nordisk are also racing to develop oral obesity treatments, signaling even fiercer market competition ahead. AstraZeneca, known for its COVID-19 vaccine, is developing the obesity treatment compound ECC5004 in partnership with China's Ecogene. Another global pharmaceutical company, Roche, is conducting Phase 1 clinical trials for a compound called CT-966, while Merck, in collaboration with China's Hansoh Pharma, is preparing early-stage trials for the oral obesity treatment agent HS-10535.

With the commercialization of oral obesity treatments, consumer accessibility is expected to increase, leading to significant market expansion. Investment bank Goldman Sachs stated in a report, "The current obesity treatment market, worth about 6.7 billion dollars (about 9.3 trillion won), is expected to grow at an annual average rate of over 50%. By 2030, it could expand to 100 billion dollars (about 138.74 trillion won), rivaling the market for hypertension treatments."