intelligently
Eli Lilly and Company (NYSE: LLY) and Novo Nordisk (NVO) now have the largest market capitalization among Big Pharma, thanks to the widespread popularity of their respective GLP-1 drugs for weight loss and diabetes management.
Novo Nordisk and Eli Lilly have entered GLP-1 has been in the game for years. The drugs currently attracting the most attention are Novo Nordisk’s semaglutide, known as Wegovy, for weight loss and diabetes treatment Ozempic, and Eli Lilly and Company’s tezepatide, known as Zepbound, for weight loss products) and Mounjaro for diabetes. The companies are also developing multiple next-generation weight loss and diabetes drug candidates.
Which brings us to today’s biomedical investing questions: Is Eli Lilly or Novo Nordisk a better investment?
We asked Seeking Alpha biomedical analysts Edmund Ingham, Stephen Ayers and Terry Chrisomalis which one they think has the advantage.
Edmund Ingham: This is a difficult question to answer. Novo’s semaglutide (known as Ozempic for type 2 diabetes and Wegovy for obesity) has been on the market longer and has revenue of more than $18 billion in 2023, while tezepatide (Mounjaro/Zepbound) will have revenue of about $5 billion by 2024 and 2025, this growth is likely to accelerate rapidly. Novo stock is up over 500% and Novo stock is up over 400%, but since Eli Lilly has greater potential to deliver market-beating revenue numbers thanks to the recently launched Zepbound, I conclude that Eli Lilly stock could Has greater upside potential. Both are becoming somewhat saturated.
Stephen Ayers: Novo Nordisk has a broad pipeline of obesity treatments targeting multiple targets. The obesity market, like the statin market, is unlikely to be a winner-take-all situation. Hence, product diversity comes into play. Novo is working on targets such as GDF15 analogs and PYY. Additionally, CagriSema, currently in Phase 3 trials, is an interesting combination of semaglutide and cagrilintide (an amylin receptor agonist) that could bring unique differentiation.
Terry Chrismalis: As an investment, I’d say Novo Nordisk is better. why is that? As the drug is being advanced, it’s called CagriSema. The drug, which uses a combination of semaglutide and caglitide, has been shown in tests to achieve significant weight loss compared to Eli Lilly and Company’s Zepbound.
In a Phase 2 study, the CagriSema combination reduced weight loss by 15.6% from baseline over a 32-week treatment period. By comparison, when patients in the Phase 3 study received Zepbound, they lost 20.9% of their body weight at 72 weeks at the highest dose. The takeaway here is that after Novo Nordisk’s Phase 3 study is completed, CagriSema has a good chance of ultimately achieving greater weight loss for patients. So based on that potential alone, I think Novo Nordisk is a better long-term investment opportunity.
