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Can EU Label Expansions of NVO's GLP-1 Drugs Spur Sales Growth?
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Key Takeaways
Novo Nordisk is expanding EU use for Wegovy, Ozempic and Rybelsus to reach more patients.
Wegovy pill nears EU approval, while Novo Nordisk seeks EU approval for oral Ozempic in T2D.
EU label expansions may lift volumes, but Lilly rivalry, pricing pressure and costs remain headwinds.
Novo Nordisk (NVO - Free Report) is a dominant player in the GLP-1 space, marketing its semaglutide drugs worldwide under brand names Ozempic and Rybelsus for type II diabetes (T2D) and Wegovy for chronic weight management.
However, Novo Nordisk remains under pressure despite a modest 2026 guidance raise following first-quarter results, as management still expects sales and operating profit to decline, amid intensifying competition from arch-rival Eli Lilly (LLY - Free Report) . While the slightly improved outlook reflects stronger GLP-1 demand, wider obesity-drug adoption and ongoing Wegovy launches, pricing pressure, softer prescription trends, lower Medicaid coverage, rivalry with Lilly, “Most Favored Nation” pricing agreement, exclusivity losses and higher spending continue to weigh on NVO’s prospects.
Against this backdrop, Novo Nordisk is expanding its cardiometabolic portfolio outside the United States to reach a broader patient base, lift sales volumes and offset pricing and competitive pressures.
In the EU, Novo Nordisk is expanding semaglutide's reach through new indications. Wegovy injection is now approved for reducing major cardiovascular events, easing HFpEF symptoms and relieving osteoarthritis-related knee pain in obesity. A 7.2 mg Wegovy dose, showing up to 25% weight loss in the STEP UP study, has also been approved in the EU. An application seeking the marketing authorization for the 7.2 mg dose delivered through a single-dose pen for people living with obesity is currently under review in the EU, with launch expected in the third quarter of 2026.
Novo Nordisk is also looking to secure EU approval of oral Wegovy for obesity and reducing cardiovascular risks, currently under regulatory review. The advisory committee to the regulatory body in the EU recently adopted a positive opinion recommending its approval. The positive opinion moves the Wegovy pill closer to becoming the first oral GLP-1 treatment approved for weight management in the EU. Novo Nordisk expects to launch the medicine in the first markets outside the United States in the second half of 2026.
Ozempic’s label has also been expanded in the EU to reduce cardiovascular risk in adults with T2D, established cardiovascular disease and chronic kidney disease. A regulatory filing seeking its label expansion to treat peripheral artery disease is currently under review in the EU. NVO is also seeking the approval of an oral formulation of Ozempic in the EU for T2D.
Novo Nordisk has secured approval for the label expansion of Rybelsus as an adjunct to standard of care to reduce cardiovascular risks in the EU. It is currently the first and only oral GLP-1 receptor agonist approved for T2D, with proven cardiovascular benefits. NVO has also reported positive late-stage data for oral semaglutide in children and adolescents and plans to pursue EU label expansions for Rybelsus and oral Ozempic in pediatric T2D later this year.
EU label expansions can help Novo Nordisk widen semaglutide use, boost volumes and support sales growth. However, increasing competition from Lilly, persistent pricing pressure and higher costs mean they are more likely to cushion headwinds than drive a sharp near-term recovery.
Competition Heating Up in the Obesity Space
Competition in the obesity market is a major overhang for NVO. Eli Lilly continues to strengthen its position in the obesity and diabetes markets, raising questions about Novo Nordisk’s ability to defend market share and maintain pricing power over time. LLY comprehensively beat earnings and revenue estimates in the first quarter of 2026, driven by robust worldwide volume growth in its tirzepatide (GLP-1) medicines, including 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, together generating $12.82 billion in first-quarter revenues, which accounted for around 65% of the company’s total revenues. Eli Lilly is also seeking EU approval of its oral GLP-1 drug, orforglipron, for adults with obesity or overweight with weight-related medical problems, with a decision expected in 2027.
The obesity space is also attracting new contenders to challenge the incumbents. Smaller biotech firms, like Viking Therapeutics (VKTX - Free Report) and Structure Therapeutics (GPCR - Free Report) , are advancing 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 fourth quarter of 2026. Structure Therapeutics’ phase II ACCESS study on its orally administered GLP-1 RA, aleniglipron, demonstrated significant weight loss across all doses. Structure Therapeutics expects to initiate the late-stage program of aleniglipron in obesity in the second half of 2026.
NVO’s Stock Price, Valuation & Estimates
Year to date, Novo Nordisk shares have lost 11.6% against the industry’s 2.3% growth. 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
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 13.02 forward earnings, which is lower than 17.44 for the industry. The stock is trading much below its five-year mean of 29.25.
NVO Stock’s Valuation
Image Source: Zacks Investment Research
Earnings estimates for 2026 have improved from $3.34 to $3.46 per share over the past 30 days. During the same time frame, Novo Nordisk’s 2027 earnings estimates have increased from $3.35 to $3.44 per share.
View the Zacks #1 Rank List
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Can EU Label Expansions of NVO's GLP-1 Drugs Spur Sales Growth?
Key Takeaways
Novo Nordisk (NVO - Free Report) is a dominant player in the GLP-1 space, marketing its semaglutide drugs worldwide under brand names Ozempic and Rybelsus for type II diabetes (T2D) and Wegovy for chronic weight management.
However, Novo Nordisk remains under pressure despite a modest 2026 guidance raise following first-quarter results, as management still expects sales and operating profit to decline, amid intensifying competition from arch-rival Eli Lilly (LLY - Free Report) . While the slightly improved outlook reflects stronger GLP-1 demand, wider obesity-drug adoption and ongoing Wegovy launches, pricing pressure, softer prescription trends, lower Medicaid coverage, rivalry with Lilly, “Most Favored Nation” pricing agreement, exclusivity losses and higher spending continue to weigh on NVO’s prospects.
Against this backdrop, Novo Nordisk is expanding its cardiometabolic portfolio outside the United States to reach a broader patient base, lift sales volumes and offset pricing and competitive pressures.
In the EU, Novo Nordisk is expanding semaglutide's reach through new indications. Wegovy injection is now approved for reducing major cardiovascular events, easing HFpEF symptoms and relieving osteoarthritis-related knee pain in obesity. A 7.2 mg Wegovy dose, showing up to 25% weight loss in the STEP UP study, has also been approved in the EU. An application seeking the marketing authorization for the 7.2 mg dose delivered through a single-dose pen for people living with obesity is currently under review in the EU, with launch expected in the third quarter of 2026.
Novo Nordisk is also looking to secure EU approval of oral Wegovy for obesity and reducing cardiovascular risks, currently under regulatory review. The advisory committee to the regulatory body in the EU recently adopted a positive opinion recommending its approval. The positive opinion moves the Wegovy pill closer to becoming the first oral GLP-1 treatment approved for weight management in the EU. Novo Nordisk expects to launch the medicine in the first markets outside the United States in the second half of 2026.
Ozempic’s label has also been expanded in the EU to reduce cardiovascular risk in adults with T2D, established cardiovascular disease and chronic kidney disease. A regulatory filing seeking its label expansion to treat peripheral artery disease is currently under review in the EU. NVO is also seeking the approval of an oral formulation of Ozempic in the EU for T2D.
Novo Nordisk has secured approval for the label expansion of Rybelsus as an adjunct to standard of care to reduce cardiovascular risks in the EU. It is currently the first and only oral GLP-1 receptor agonist approved for T2D, with proven cardiovascular benefits. NVO has also reported positive late-stage data for oral semaglutide in children and adolescents and plans to pursue EU label expansions for Rybelsus and oral Ozempic in pediatric T2D later this year.
EU label expansions can help Novo Nordisk widen semaglutide use, boost volumes and support sales growth. However, increasing competition from Lilly, persistent pricing pressure and higher costs mean they are more likely to cushion headwinds than drive a sharp near-term recovery.
Competition Heating Up in the Obesity Space
Competition in the obesity market is a major overhang for NVO. Eli Lilly continues to strengthen its position in the obesity and diabetes markets, raising questions about Novo Nordisk’s ability to defend market share and maintain pricing power over time. LLY comprehensively beat earnings and revenue estimates in the first quarter of 2026, driven by robust worldwide volume growth in its tirzepatide (GLP-1) medicines, including 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, together generating $12.82 billion in first-quarter revenues, which accounted for around 65% of the company’s total revenues. Eli Lilly is also seeking EU approval of its oral GLP-1 drug, orforglipron, for adults with obesity or overweight with weight-related medical problems, with a decision expected in 2027.
The obesity space is also attracting new contenders to challenge the incumbents. Smaller biotech firms, like Viking Therapeutics (VKTX - Free Report) and Structure Therapeutics (GPCR - Free Report) , are advancing 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 fourth quarter of 2026. Structure Therapeutics’ phase II ACCESS study on its orally administered GLP-1 RA, aleniglipron, demonstrated significant weight loss across all doses. Structure Therapeutics expects to initiate the late-stage program of aleniglipron in obesity in the second half of 2026.
NVO’s Stock Price, Valuation & Estimates
Year to date, Novo Nordisk shares have lost 11.6% against the industry’s 2.3% growth. 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
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 13.02 forward earnings, which is lower than 17.44 for the industry. The stock is trading much below its five-year mean of 29.25.
NVO Stock’s Valuation
Earnings estimates for 2026 have improved from $3.34 to $3.46 per share over the past 30 days. During the same time frame, Novo Nordisk’s 2027 earnings estimates have increased from $3.35 to $3.44 per share.
NVO’s Estimate Movement
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.