The United States has approved the first "oral weight loss miracle drug," Novo Nordisk takes the lead with a surge in stock price, and Eli Lilly is expected to receive approval in March

Before Eli Lilly, Novo Nordisk scored a victory in the competition for weight loss drugs in the United States.

On Monday, December 22, the U.S. Food and Drug Administration (FDA) approved the first oral GLP-1 weight loss drug from Danish pharmaceutical giant Novo Nordisk. This new drug is the oral version of its star injectable product Wegovy, providing a new option for millions of obesity patients seeking more convenient treatment solutions.

The news immediately sparked a positive reaction in the capital markets. Novo Nordisk's stock price rose about 10% in after-hours trading, before slightly retreating to an 8% increase. For Novo Nordisk, this approval is a key victory, as its stock price had been under pressure earlier in the year due to market concerns about its competitive position.

This approval also temporarily puts Novo Nordisk ahead in the fierce race against its main competitor, Eli Lilly. According to Bloomberg, Eli Lilly's own oral weight loss drug is expected to be approved in March next year. This means Novo Nordisk has a valuable window of a few months to consolidate its first-mover advantage in the oral drug market, which is becoming the next core battleground for both giants after injectables.

Oral New Drug Launches First, Pricing Strategy Emerges

According to Novo Nordisk's statement, this oral new drug will be launched in the United States in early January next year. The company disclosed its preliminary pricing strategy, with a cash price of $149 per month for the starting dose. The company also stated that for patients with insurance, the monthly cost could be as low as $25, covering all doses. Pricing for higher doses and more detailed insurance coverage and patient savings plans will be announced closer to the launch date.

Novo Nordisk CEO Mike Doustdar stated in the announcement: "The Wegovy oral medication provides patients with a new, convenient treatment option that can help them start or continue their weight loss journey." He emphasized that currently, no other oral GLP-1 therapy can achieve the weight loss effects of Wegovy oral medication.

This new drug will be sold through pharmacies and some telemedicine platforms. Dave Moore, Executive Vice President of U.S. Operations at Novo Nordisk, told CNBC that offering an oral option can "activate and motivate different groups of patients to seek treatment," thereby expanding market coverage.

Clinical Data Support, Efficacy and Cardiovascular Benefits Balanced

The FDA's approval was based on the results of a Phase 3 clinical trial called Oasis 4. The trial data showed that patients taking a daily dose of 25 mg lost an average of about 16.6% of their body weight after 64 weeks. This significant weight loss effect provides strong support for the drug's efficacy.

More importantly, the scope of this approval is not limited to weight loss. According to Novo Nordisk, the drug has also been approved to reduce the risk of major cardiovascular events (such as death, heart attack, or stroke) in obese adults with cardiovascular disease. This aligns with the approved label for the company's injectable weight loss drug Wegovy, further enhancing the competitiveness of its product

Market Landscape Changes, Competition with Eli Lilly Intensifies

The approval of this oral medication is crucial for Novo Nordisk's strategy. Reports indicate that the company has recently faced fierce competition in the obesity market it pioneered. Its flagship drug Wegovy's market share is being eroded by Eli Lilly's Zepbound, with a head-to-head trial showing the latter's weight loss effects to be superior.

In this context, the oral Wegovy is highly anticipated by Novo Nordisk, seen as a core driver to regain market leadership and propel future growth. Although the leading window may only last a few months, being the first to enter the market means establishing brand recognition and physician prescribing habits more quickly.

Bright Prospects for Oral Formulations, Convenience is Key

Oral formulations are widely regarded as the next growth engine in the weight loss drug market. Goldman Sachs analysts previously predicted that by 2030, oral medications could capture 24% of the global weight loss drug market, amounting to approximately $22 billion.

However, convenience also comes with some differences in usage. Novo Nordisk's oral medication is a peptide drug, requiring patients to wait 30 minutes after taking it before eating or drinking. In contrast, Eli Lilly's oral medication, which is under development, is not a peptide and is reportedly easier for the body to absorb, with no similar dietary restrictions. Although Novo Nordisk's oral medication shows slightly better efficacy based on existing data, the comparison of the convenience and patient adherence of both drugs in the real world will be key factors in determining market share