Novo Nordisk NVO is a dominant player in the GLP-1 space, marketing its semaglutide drugs under brand names Ozempic (pre-filled pen) and Rybelsus (oral tablet) for type II diabetes (T2D), and Wegovy (injection and oral tablet) for chronic weight management.
Though NVO has been able to bring the compounded alternatives problem under control with help from the FDA and strategic deals with telehealth companies, it still faces mounting structural challenges, as evidenced by its 2026 outlook, which highlights weak core momentum. Adjusted guidance points to declines in sales and operating profit, as pricing pressure, rising competition from arch-rival Eli Lilly LLY and slowing U.S. demand weigh on performance. While international growth and the launch of oral Wegovy offer some support, increased costs and lack of one-off benefits limit upside, leaving investors doubtful about Novo Nordisk’s ability to sustain its leadership in the evolving obesity market.
Amid intensifying competition, Novo Nordisk is working to broaden its cardiometabolic portfolio, aiming to expand the eligible patient base, which is expected to drive higher sales volumes and help cushion the impact of pricing pressure.
Last week, NVO announced positive top-line results from the phase IIIa PIONEER TEENS study, which evaluated oral semaglutide in children and adolescents aged 10 to 17 years with T2D. Per the data readout, the study demonstrated a statistically significant and superior reduction in HbA1c by 0.83% versus placebo at 26 weeks, meeting the primary endpoint, and showed a well-tolerated safety profile consistent with prior semaglutide studies.
Novo Nordisk also announced that the FDA recently approved an oral version of Ozempic (1.5 mg, 4 mg and 9 mg) for adult T2D patients, which is expected to be launched in the second quarter of 2026. A supplemental application for a higher 25 mg tablet is also under review, with a regulatory decision expected by the end of 2026.
Based on the phase IIIa PIONEER TEENS study data, NVO intends to seek regulatory approval for a label expansion of both Rybelsus and oral Ozempic in children and adolescents aged 10 to 17 years with T2D in the United States and the EU in the second half of 2026.
The rollout of oral Ozempic, like the Wegovy pill, could meaningfully strengthen Novo Nordisk’s positioning by reducing the treatment burden for T2D patients who prefer pills over injections, potentially improving adherence and persistence rates in real-world settings. Better adherence typically translates into more consistent outcomes and sustained demand, supporting volume growth amid pricing pressure.
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Additionally, the planned label expansion of oral Ozempic and Rybelsus into pediatric populations would broaden the addressable market, allowing Novo Nordisk to tap into an earlier-line and younger patient segment. Together, these moves could help the company offset competitive headwinds by driving incremental uptake across both existing and new patient cohorts.
Competition Heating Up in the Obesity Space
Eli Lilly markets its tirzepatide (GLP-1) injections as Mounjaro for T2D and Zepbound for obesity. Despite being on the market for just over three years, these drugs have become LLY’s key top-line drivers. Lilly recently secured FDA approval of its oral GLP-1 drug, orforglipron, for adults with obesity or overweight with weight-related medical problems, marketed under the brand name Foundayo. The drug competes directly with NVO’s Wegovy pill. Novo Nordisk and rival Eli Lilly have also introduced multiple price cuts in response to pressure from the U.S. government during 2025 and 2026 to improve patient access to GLP-1 medicines.
The obesity space has garnered much of the spotlight over the past year due to the sizeable and still underpenetrated market opportunity. Smaller biotechs like Viking Therapeutics VKTX are also developing GLP-1-based therapies to challenge the incumbents.
Viking Therapeutics’ dual GIPR/GLP-1 receptor agonist, VK2735, is being developed both as oral and subcutaneous formulations for the treatment of obesity. Viking Therapeutics plans to advance oral VK2735 into phase III development for obesity in the third quarter of 2026.
NVO’s Stock Price, Valuation & Estimates
Year to date, Novo Nordisk shares have lost 19% compared with the industry’s 6.4% decline. The company has also underperformed the sector and the S&P 500 during the same time frame, as seen in the chart below.
NVO Stock Underperforms the Industry, Sector & the S&P 500 
Zacks Investment Research
Image Source: Zacks Investment Research
Novo Nordisk is trading at a discount to the industry, as seen in the chart below. Going by the price/earnings ratio, the company’s shares currently trade at 12.33 forward earnings, which is lower than 16.43 for the industry. The stock is trading much below its five-year mean of 29.25.
NVO Stock Valuation Zacks Investment Research
Image Source: Zacks Investment Research
Earnings estimates for 2026 have declined from $3.36 to $3.34 per share over the past 60 days. During the same time frame, Novo Nordisk’s 2027 earnings estimates have increased from $3.31 to $3.35.
NVO Estimate Movement Zacks Investment Research
Image Source: Zacks Investment Research
Novo Nordisk currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).