Novo Nordisk (NVO), the company behind popular diabetes and weight loss medications Ozempic and Wegovy, warned that President Trump’s tariffs could disrupt global supply chains and potentially lead to higher drug prices and shortages. CEO Lars Fruergaard Jorgensen explained that Novo Nordisk relies on cross-border trade like many other businesses, and any new tariffs would have an immediate impact as the company works to adjust to the new costs.
Last month, Trump met privately with top pharmaceutical executives and warned them about the possibility of imposing tariffs on the industry. He also urged drug manufacturers to shift their production to the United States. In addition to this, Trump has previously floated the idea of adding 25% tariffs on goods imported from the European Union, with pharmaceuticals, automobiles, and agriculture identified as likely targets.
Jorgensen pointed out that generic drugs could be hit especially hard since many rely on active ingredients that are sourced from overseas due to the limited production capacity in the U.S. Generic drugs also tend to be cheaper than their brand-name counterparts. Therefore, tariffs could worsen the healthcare affordability issue in the U.S.
Is NVO Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on NVO stock based on five Buys, four Holds, and one Sell assigned in the past three months, as indicated by the graphic below. After a 35% decline in its share price over the past year, the average NVO price target of $109.29 per share implies 24.7% upside potential.
