Copycat drugs, tariffs, US competitors, and insurance coverage headaches are throwing off a once-thriving EU weight-loss market and its Danish crown jewel, Novo Nordisk.  

In early May, Novo Nordisk’s CEO, Lars Fruergaard Jørgensen, shockingly stepped down amid mounting pressure in the ultra-competitive weight-loss market.  

Once Europe's most valuable publicly listed company – having overtaken French luxury giant LVMH – Novo Nordisk soared to prominence thanks to its blockbuster diabetes and weight loss drugs, Ozempic and its little brother Wegovy.

These drugs not only made the company a household name but also helped fund hordes of Denmark’s public projects, from universities to roads.

But since June, Novo's shares have plunged 59 percent, eclipsed by US multinational Eli Lilly's rival product, Zepbound. 

Novo Nordisk said Jørgensen’s resignation was a “mutual agreement” between him and the board. However, Board Chairman Helge Lund cited market headwinds, declining stock prices, and a request from Novo’s major shareholder as reasons behind the decision. 

Jørgensen –  a quintessential Dane, calm and collected – had told reporters in January that Novo Nordisk was “well-positioned” to face looming US tariffs on EU pharmaceuticals.  

The board, seemingly, wasn't convinced. Now, the company is looking for a new boss with Danish values and a business-friendly American flair, reported the Financial Times.  

The T-word 

Novo Nordisk is highly exposed to US tariffs, due to its massive export market to America – and a volatile political backdrop, including President Donald Trump’sthreats to imposehigh levies on Denmark if it refused to cede Greenland to Washington. 

The company, a global leader in diabetes and obesity treatments, generates 61% of its sales in North America, where diabetes rates are high. Ozempic, for example, costs around $1,000 per monthly dose in the US, compared to just $92 in Germany.

Trump took aim at the drugs again in early May, during his announcement of a “most-favoured nation” drug pricing policy, vowing to slash drug prices by up to 80%.

He specifically hit out at Ozempic, saying that US patients had to foot the bill for the high costs of innovation – a move that could send Novo's stock plummeting by a third. 

A Novo Nordisk spokesperson told Euractiv that while the company was closely monitoring developments, it would not speculate on policy decisions, leaving that to “policymakers to manage the geopolitical landscape.”

“We remain focused on our commitment to deliver lifesaving medicines to the patients we serve,” the spokesperson added.  

However, the International Monetary Fund (IMF) noted in May that tariffs alone won’t be what slows down Denmark's pharmaceutical boom, as the country often outsources production to third-party manufacturers. Rather, broader trade tensions and export barriers may pose more serious long-term challenges, according to the IMF.

Copycats & competitors 

Once in a while, scientists develop treatments that end up being even more popular beyond their intended use.

Semaglutide – the active ingredient found in Ozempic and Wegovy – was originally developed to treat type 2 diabetes and regulate blood sugar levels. Today, it's hailed for trimming waistlines, being touted by influencers and stealing Hollywood's spotlight. Even Jørgensen admitted the drugs' success had been “surprising.” 

High demand for Ozempic – despite steep prices  – has led to supply shortages across Europe in recent years, prompting the emergence of copycat and counterfeit drugs. These often use the names and addresses of legitimate pharmacies to deceive buyers.

Mike Isles, director of the Alliance for Safe Online Pharmacy in the EU, said the number of  copycat drugs – many not even containing semaglutide – were rising in the bloc. In the US, compounded copies have hit direct-to-consumer telemedicine platforms like Hims & Hers Health.

Novo told Euractiv it would "rigorously" defend its patents globally and take legal action if third parties violated them.

And it’s not just copycat drugs threatening the company’s sales. Eli Lilly is also aggressively competing for dominance in the US weight-loss market. In April, the company reported promising early results for a once-daily weight-loss pill – a potentially more appealing alternative to injections.

Insurance headaches

Another issue troubling Novo Nordisk sales is limited insurance coverage for its GLP-1 drugs. Most countries in Europe don't reimburse weight loss drugs over concerns they could be used for “aesthetic” rather than medical reasons.

But the tide could be turning. French Health Minister Yannick Neuder recently teased a new obesity plan in September during a visit to Novo Nordisk's production plant in Chartres. 

If Europe had broader insurance policies for weight loss drugs, it could help to “ensure patients obtain [Ozempic] via legitimate ways,” said Isles.

The EU’s regulatory agency, the European Medicines Agency, told Euractiv it is reviewing Eli Lilly's Mounjaro for approval for other medical conditions such as chronic heart failure.

Novo could also argue for the EMA to consider broader approval for semaglutide as it has shown cardiovascular benefits.

Poland, it’s Denmark’s turn  

Meanwhile, EU capitals are battling over a revision of their pharmaceutical legislation.

Denmark and other countries with strong pharmaceutical sectors are pushing for longer data protection monopolies, while Poland, currently leading the Council Presidency, wants shorter ones.

The former camp could win as Denmark is set to assume the the rotating EU presidency in June, when Poland's six-month mandate ends.

But Danish lawmaker Stine Bosse told Euractiv that there was “nothing to fear” from country’s upcoming term, stressing that Denmark would champion accessible medicines.

Regardless, under growing pressure, Denmark's upcoming term is shaping up to be a Novo Nordisk presidency – while the company races to reinvent itself.