Novo Nordisk's CagriSema Trial Loss Exacerbates Competitive and Pricing Pressures

What happened

Novo Nordisk announced on February 23, 2026, that its experimental weekly shot CagriSema showed less dramatic weight loss than Eli Lilly's Tirzepatide in an 84-week clinical trial, causing a stock plunge. This outcome directly undermines Novo's pipeline innovation, confirming competitive disadvantages highlighted in the DeepValue report, where Novo lost GLP-1 volume share and ceded weekly prescription leadership in 2025. The failure occurs amid a structural reset in U.S. net-price compression, with management guiding for 2026 sales declines of -5% to -13% CER due to pricing pressures and competition. Oral Wegovy's launch, initially strong with 18,410 weekly scripts, now faces heightened scrutiny as Lilly's oral obesity drug decision looms in April 2026, threatening Novo's only near-term volume lever. Consequently, investor confidence in Novo's ability to offset price erosion with superior products weakens, amplifying the risks embedded in the waiting thesis.

Implication

The trial failure signals that Novo's next-generation products may not match Lilly's efficacy, limiting future revenue streams and exacerbating existing competitive share losses. It reinforces the DeepValue report's warnings about Novo's weakening market position amid intense rivalry and structural pricing headwinds from MFN agreements and government reference prices. With oral Wegovy as the primary volume driver, any failure to sustain script durability above launch levels could accelerate sales declines, as pricing compression becomes more dominant. Investors must now weigh heightened pipeline risks against already discounted valuations, requiring closer monitoring of oral Wegovy scripts and pricing commentary in the next 3-6 months. Overall, this event shifts the investment narrative toward a more defensive stance, emphasizing downside protection over upside potential.

Thesis delta

The news confirms the competitive intensity and pipeline vulnerabilities embedded in the WAIT rating, increasing the weight toward the bear scenario with a higher likelihood of sales erosion. While the core thesis of waiting for oral Wegovy durability and pricing stabilization remains unchanged, this setback underscores the urgency of those catalysts and raises the bar for Novo to prove it can outgrow net-price compression.