Novo Nordisk's European stock plummeted 18%, CEO admits: facing "unprecedented pricing pressure" in 2026

Danish pharmaceutical giant Novo Nordisk is facing the most severe performance challenges in nearly a decade, with the company expecting a significant decline in sales by 2026 as market competition intensifies.

On February 4, CEO Mike Doustdar candidly stated that the company will encounter "unprecedented pricing pressure" in 2026, and the price reduction of its star weight-loss drug Wegovy in the U.S. will have a "painful" financial impact, but this move aims to achieve broader market coverage and long-term development.

Previously, Novo Nordisk's 2026 performance outlook was significantly below market expectations, with projected annual sales expected to decline by 5% to 13% at constant exchange rates, far exceeding analysts' anticipated decline of about 1.4%. The pessimistic guidance triggered significant stock price volatility; after the earnings report was released, trading of Novo Nordisk's American Depositary Receipts listed on the New York Stock Exchange was briefly halted, and after resuming trading, the stock fell more than 10% near midday, closing down 14.6%. The negative sentiment continued to transmit to the European market after hours, with its European stock price dropping 18%.

To stabilize market confidence, Novo Nordisk announced a new round of stock buybacks, planning to repurchase up to 3.8 billion Danish kroner worth of shares between February 4 and May 4, while also announcing a new buyback plan worth 15 billion Danish kroner, aiming to convey confidence in the company's long-term value to investors.

Multiple Pressures Erode Revenue Outlook

Novo Nordisk's 2026 performance guidance reflects expectations for sales growth in international business and sales decline in the U.S. market. Although the global GLP-1 market is expected to continue expanding, this will be offset by lower actual prices.

The "Most Favored Nation Pricing" policy promoted by U.S. President Trump has become one of the main sources of pressure. This agreement aims to allow more Americans to access GLP-1 drugs at lower costs but will significantly reduce Novo Nordisk's actual prices. Additionally, the expiration of patents for semaglutide in multiple international markets will also have a significant impact on revenue.

In the U.S. market, the company's GLP-1 injection product line is facing dual pressures from changes in prescription trends and intensified competition. Its star products Ozempic and Wegovy are being strongly challenged by competitors such as Eli Lilly's Zepbound. The negative impact of the U.S. Medicaid program reducing coverage for obesity drugs further exacerbates the pressure.

Novo Nordisk expects that adjusted sales growth in Danish kroner will be 3 percentage points lower than at constant exchange rates, primarily affected by the depreciation of the U.S. dollar against the Danish kroner. This will mark the company's first annual sales decline in nine years, with the last decline occurring in 2017 due to a price war in the U.S. insulin market

Wegovy Oral Version Boosts Confidence

Despite facing severe challenges, Novo Nordisk still has certain highlights. The U.S. Food and Drug Administration approved the first oral GLP-1 obesity treatment drug on December 22, 2024 — a once-daily oral semaglutide 25mg, branded as Wegovy tablets.

The product will be launched on January 5, 2026, and as of January 23, the total weekly prescription volume is approximately 50,000. Doustdar stated that 170,000 people taking Wegovy tablets are essentially new patients, and the company is very encouraged by the early acceptance of this product in the U.S. market.

Doustdar emphasized that the company is "very confident" in its ability to meet the demand for Wegovy tablets and remains optimistic about driving sales growth in the coming years. According to Bloomberg Intelligence analyst Michael Shah, citing Symphony Health data, this performance appears to be better than the initial sales of Eli Lilly's Zepbound.

Novo Nordisk plans to continue launching Wegovy in more markets in 2026 and introduce a 7.2mg dosage in several countries. The company continues to focus on expanding the accessibility of Wegovy, particularly through NovoCare Pharmacy in out-of-pocket channels and partnerships with telemedicine providers.

2025 Performance Slightly Exceeds Expectations

Novo Nordisk's full-year performance for 2025 shows a sales increase of 6% to DKK 309.06 billion, a 10% increase at constant exchange rates, slightly above analysts' expectations of DKK 307.62 billion. This growth is primarily driven by the obesity care business, which grew by 31% at constant exchange rates, while GLP-1 diabetes product sales increased by 6%.

Operating profit was DKK 127.66 billion, a decrease of 0.5% year-on-year, but a 6% increase at constant exchange rates. Net profit was DKK 102.43 billion, an increase of 1.4% year-on-year. Excluding approximately DKK 8 billion in corporate transformation costs, operating profit would have increased by 6%, and by 13% at constant exchange rates.

Fourth-quarter performance showed sales of DKK 79.14 billion, a decrease of 7.6% year-on-year, but higher than analysts' expectations of DKK 76.9 billion. Wegovy sales were DKK 21.86 billion, exceeding the expected DKK 21.07 billion. Ozempic's annual sales were DKK 127.09 billion, surpassing the expected DKK 124.87 billion.

Sales in the U.S. business increased by 8% at constant exchange rates, while international business grew by 14%. Total sales for the obesity and diabetes care business were DKK 289.46 billion, with rare disease business sales increasing by 9%. The company provided innovative treatments for 46 million patients in 2025.

Shareholder Return Measures

In addition to repurchasing up to DKK 3.8 billion in shares from February 4 to May 4, the Novo Nordisk Board also decided to initiate a new share repurchase program of up to DKK 15 billion (approximately $2.4 billion). The Board will also propose a final dividend of DKK 7.95 per share at the annual general meeting on March 26, 2026, bringing the expected total dividend for 2025 to DKK 11.70 per share Doustdar acknowledged that 2025 will be a challenging year for the company, but emphasized that despite facing pricing pressures and intensified competition in 2026, the company remains confident in driving sales growth in the coming years. Novo Nordisk AS also looks forward to regulatory decisions on the next generation of therapeutic products in 2026, including Mim8 in the field of hemophilia and CagriSema in the field of obesity