Novo Nordisk A/S (NVO) has slashed prices for its blockbuster weight-loss drug Wegovy as competition in the obesity drug market heats up, with Eli Lilly (LLY) as a key rival. The company launched NovoCare Pharmacy, a direct-to-consumer platform designed to make its drug more accessible. This price cut came just days after Eli Lilly reduced the price of its weight-loss drug Zepbound by at least $50 per vial. NVO stock gained nearly 4% on Wednesday.
Meanwhile, the launch follows the FDA’s recent confirmation that Wegovy is no longer in shortage, with all dose strengths now meeting current and expected U.S. demand. In context, Wegovy sales jumped over 100% year-over-year to DKK.19.87 billion in Q4 FY24. For the full year, sales rose 56% to DKK.65.1 billion in FY24, particularly due to high demand in the U.S.
Novo Nordisk Lowers Wegovy Prices for US Customers
Under the NovoCare program, Novo Nordisk will offer Wegovy at less than half its usual monthly price to stay competitive in the U.S. obesity drug market. Uninsured patients or those without obesity treatment coverage can purchase any dose for $499 per month, compared to the typical $1,350 price tag.
Likewise, Eli Lilly has expanded its direct-to-consumer offerings through its LillyDirect platform. The company now provides 7.5 mg and 10 mg single-dose vials of Zepbound for $499 per month, provided patients fill their initial prescription and refill it within 45 days.
Eli Lilly, Novo Nordisk Eye Market Share Gains
The two firms are battling for dominance in the GLP-1 market, with drugs that curb appetite and control blood sugar. Both companies are vying for market share while working to divert patients from compounding pharmacies that have been producing lower-cost alternatives to weight-loss drugs. These pharmacies have supplied hundreds of thousands of Wegovy copies during shortages. Notably, compounding pharmacies specialize in creating customized medications by mixing ingredients to meet specific patient needs.
Interestingly, U.S.-based telehealth company Hims & Hers Health (HIMS) fell 3.37% in after-market trading following the Wegovy price cut news. As big pharmaceutical companies expand their direct-to-consumer strategies, HIMS’ revenue growth could face pressure in 2025.
LLY or NVO: Which Pharma Stock Offers Higher Upside?
Using the TipRanks Stock Comparison tool, we analyzed NVO and LLY to determine which stock offers greater upside potential, according to analysts.
According to TipRanks, NVO stock holds a Moderate Buy rating based on 10 analyst recommendations. The Novo Nordisk average share price target of $109.29 implies a 20.3% upside from its current level. Meanwhile, LLY stock has a Strong Buy rating, backed by 17 Buy and 1 Hold recommendations. However, Eli Lilly’s share price target of $1,029.14 suggests a more modest 11% growth potential.
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