A few days ago, Novo Nordisk cuts its sales and profit forecasts for the first time since Wegovy launched four years ago.
Wegovy-Maker Novo Nordisk has launched CEO Lars Fruergaard Jorgensen with concerns that the company is losing its first step advantage in the competitive obesity drug market.
Novo Nordisk announced the decision on Friday.
A few days ago, Novo Nordisk cuts its sales and profit forecasts for the first time since Wegovy launched four years ago, although Jorgensen predicts the biggest market will return to growth in the second half of this year.
Novo’s chairman Helge Lund tried to assure analysts and investors that the company’s strategy was intact and that the company’s plan was unchanged.
He told Reuters News Agency that there have been discussions about replacing Jorgensen in the past few weeks. Novo earlier said Jorgensen would continue to take on his role until he found a successor.
Under Jorgensen, Novo Nordisk became the world leader in the weight loss pill market, with sales of its Wegovy and Ozempic treatment soaring.
Analysts and investors do not believe that he needs to be replaced.
"He has been leading the company for eight years and is very successful," Lukas Leu, portfolio manager at Bellevue Asset Management, told Reuters.
Danske Bank analyst Carsten Lonborg Madsen was also caught off guard.
"The way we know Novo Nordisk is to be patient when you are on the right track, and then once you have the right strategy, you'll move things in the right direction."
"I feel like something is wrong here," he said on the phone.
Novo's stock has been integrated into its market share since last June, especially from U.S. rival Eli Lilly, and has been unable to impress investors with its new drug channels.
"In view of the latest market challenges facing Novo Novers, the company's share price development has been based on Novo Nover's latest challenges since mid-2024," Novo said in a statement.
Jorgensen, 58, has been CEO since 2017. He said in an interview with Danish radio station TV2 that he did not see the decision coming and had not learned until recently.
Wegovy's booming helps make Novo the most valuable publicly-owned company in Europe, with a peak value of $6.15 billion in June last year, but its market value has been reduced to about $31.1 billion.
Novo Nordisk shares rose the news, down 0.8% at 14:01 on GMT as it rose 4% earlier in the day.
The stocks have dropped 32% from consistently, down 59% from the highest shares in history.
Eli Lilly has seen our prescription since mid-March as its Zepbound obesity surpassed Wegovy. Eli Lilly's shares rose 2.6% after the news.
Novo's head of business strategy and corporate affairs, Camilla Sylvest, and CEO Jorgensen, consistently resigned last month, without citing reasons.
Novo said Novo Nodisk's former CEO has been 16 years, and Lars Rebien Sorensen, current chairman of the Novo Nordisk Foundation, will join the board to take effect immediately with the goal of a seat at the next annual general meeting.
The company is controlled by the Novo Nordisk Foundation through its investment division, which owns 77% of the voted shares.