Healthcare ETFs for the Weight-Loss Drug Boom & Beyond
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Apr 08 2024
0mins
Should l Buy NVO?
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy NVO?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
Analyst Views on NVO
Wall Street analysts forecast NVO stock price to rise
8 Analyst Rating
4 Buy
3 Hold
1 Sell
Moderate Buy
Current: 38.720
Low
42.00
Averages
54.67
High
70.00
Current: 38.720
Low
42.00
Averages
54.67
High
70.00
About NVO
Novo Nordisk A/S is a global healthcare company engaged in diabetes care. The Company is also engaged in the discovery, development, manufacturing and marketing of pharmaceutical products. The Company operates through two business segments: diabetes and obesity care, and biopharmaceuticals. The Company's diabetes and obesity care segment covers insulin, GLP-1, other protein-related products, such as glucagon, protein-related delivery systems and needles, and oral anti-diabetic drugs. The Company's biopharmaceuticals segment covers the therapy areas of hemophilia care, growth hormone therapy and hormone replacement therapy. The Company also offers Saxenda product to treat obesity. It offers a range of products, including NovoLog/NovoRapid; NovoLog Mix/NovoMix; Prandin/NovoNorm; NovoSeven; Norditropin, and Vagifem. As of December 31, 2016, it marketed its products in over 180 countries. Its regional structure consists of two commercial units: North America and International Operations.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Eli Lilly Warns Medicare Patients May Exceed $50 Cap
- Cost Warning: Eli Lilly cautions that some Medicare patients using its GLP-1 weight loss and diabetes medications may end up paying more than the anticipated $50 monthly cap under a new government pricing model, indicating uncertainty in the implementation of Medicare policies.
- BALANCE Initiative Context: This program is part of the Centers for Medicare and Medicaid Services' (CMS) BALANCE initiative, designed to make GLP-1 drugs more affordable by allowing direct negotiations with manufacturers like Eli Lilly and Novo Nordisk, thereby enhancing patient affordability.
- Risk of Cost Variability: While most beneficiaries in participating Medicare plans are expected to pay around $50 per month, Lilly noted that cost-sharing could still vary in a small number of basic Medicare Part D plans, increasing the financial burden risk for patients.
- Market Reaction Focus: Given that changes in Medicare policy could impact patients' medication costs, investors should monitor Eli Lilly and its competitors' performance in the market, particularly regarding profitability and market share under the new pricing model.
See More
Viking Plans to Advance VK2735 Oral Drug
- Clinical Trial Progress: Viking Therapeutics is set to advance its experimental oral obesity drug VK2735 into late-stage studies in Q3 2026, with plans for four late-stage trials by the end of 2026, indicating a proactive approach in the obesity treatment sector.
- Expected Drug Efficacy: The subcutaneous formulation of VK2735 demonstrated a mean weight loss of 14.7% over 13 weeks in mid-stage trials, with the CEO expressing hopes that it will be competitive with existing GLP-1 monoagonists, thereby enhancing market competitiveness.
- Market Competition Analysis: Unlike industry giants Novo Nordisk and Eli Lilly, which launched subcutaneous forms of their blockbuster obesity drugs first, Viking's strategy to develop both subcutaneous and oral formulations showcases its diversified approach in the obesity drug market, especially as Novo's oral drug launched in January.
- New Drug Application Plans: Viking is also looking to file an application to initiate trials for a novel amylin agonist this quarter, aiming to expand its obesity portfolio and further strengthen its market position in this therapeutic area.
See More
Patience Rewards: Hims & Hers Soars Following Novo Nordisk Announcement
Stock Surge: After a significant drop of 59% year-to-date, Him & Hers Health's stock surged nearly 46% following a strategic partnership with Novo Nordisk, which will make their weight loss drugs available through telehealth platforms.
Shift to FDA-Approved Drugs: The company is transitioning from compounded GLP-1 offerings to FDA-approved medications, addressing the increasing demand for weight loss drugs while ensuring better safety and quality standards.
Positive Financial Outlook: Him & Hers Health reported a positive earnings surprise with an EPS of 8 cents, exceeding analyst expectations, and is projected to see substantial growth in earnings per share over the next year.
Analyst Upgrades: Following the announcement of the partnership with Novo Nordisk, analysts have upgraded Him & Hers Health's stock rating, indicating a bullish outlook and potential for significant upside in the coming months.
See More
Investment Opportunities in Healthcare Stocks
- Pfizer's Stock Appeal: Pfizer is currently trading at a P/E ratio of 9, significantly lower than the healthcare sector's average of 18.5, making it an attractive option for long-term investors looking to buy before a potential rebound, especially given its robust pipeline.
- Clinical Trial Progress: The company plans to initiate over a dozen phase 3 clinical trials this year, and even with a modest 50% success rate, it is expected to launch several new products that could drive revenue growth and enhance market competitiveness.
- Novo Nordisk's Market Outlook: Trading at 10.5 times forward earnings, Novo Nordisk faces competition from Eli Lilly but has promising candidates like CagriSema that outperform Wegovy, positioning it well in the rapidly growing weight loss market.
- Innovative Drug Development: Novo Nordisk's UBT251 showed excellent results in mid-stage studies in China, potentially becoming the first approved product in the anti-obesity space, and with Wegovy's new label expansions, it could significantly increase market share.
See More
Pfizer and Novo Nordisk Stock Attractiveness Analysis
- Pfizer Stock Valuation: Pfizer is currently trading at a forward P/E ratio of 9, significantly lower than the healthcare sector average of 18.5, indicating its stock is attractive given its robust pipeline that is expected to enhance financial performance.
- Clinical Trial Progress: The company plans to initiate over a dozen phase 3 clinical trials this year, and even with a modest 50% success rate, it is poised to launch several new products, particularly in oncology and weight loss, driving future revenue growth.
- Novo Nordisk Market Competition: Novo Nordisk has lost its leading position in the weight loss market to Eli Lilly, with sales expected to decline in 2026; however, its stock is currently trading at a forward P/E of 10.5, suggesting investment potential.
- New Product Potential: Novo Nordisk's next-gen candidate CagriSema has proven more effective than Wegovy, and its UBT251 showed excellent results in a mid-stage study in China, potentially bringing new growth opportunities in the anti-obesity space.
See More
Novo Nordisk Receives Warning Letter from FDA
- FDA Warning Letter: The US FDA has issued a warning letter to Novo Nordisk, accusing the company of failing to comply with postmarketing adverse event reporting requirements, indicating significant compliance deficiencies that could impact its market reputation and future product approvals.
- Investigation Period: The FDA conducted an investigation from January to February 2025, and despite Novo's multiple written responses, the agency noted that the company did not adhere to applicable statutory requirements and regulations, highlighting serious shortcomings in compliance management.
- Product Impact: With semaglutide as the active ingredient in Wegovy and Ozempic, and liraglutide in Victoza and Saxenda, the FDA's warning could negatively affect the market performance and sales of these products, thereby impacting the company's overall financial performance.
- Compliance Requirements: The FDA mandates that Novo Nordisk develop written procedures to ensure compliance with all applicable regulations for the surveillance, receipt, evaluation, and reporting of postmarketing adverse events, and failure to meet these requirements could lead to further regulatory actions and financial penalties.
See More
Eli Lilly Warns Medicare Patients May Exceed $50 Cap
- Cost Warning: Eli Lilly cautions that some Medicare patients using its GLP-1 weight loss and diabetes medications may end up paying more than the anticipated $50 monthly cap under a new government pricing model, indicating uncertainty in the implementation of Medicare policies.
- BALANCE Initiative Context: This program is part of the Centers for Medicare and Medicaid Services' (CMS) BALANCE initiative, designed to make GLP-1 drugs more affordable by allowing direct negotiations with manufacturers like Eli Lilly and Novo Nordisk, thereby enhancing patient affordability.
- Risk of Cost Variability: While most beneficiaries in participating Medicare plans are expected to pay around $50 per month, Lilly noted that cost-sharing could still vary in a small number of basic Medicare Part D plans, increasing the financial burden risk for patients.
- Market Reaction Focus: Given that changes in Medicare policy could impact patients' medication costs, investors should monitor Eli Lilly and its competitors' performance in the market, particularly regarding profitability and market share under the new pricing model.
See More
Viking Plans to Advance VK2735 Oral Drug
- Clinical Trial Progress: Viking Therapeutics is set to advance its experimental oral obesity drug VK2735 into late-stage studies in Q3 2026, with plans for four late-stage trials by the end of 2026, indicating a proactive approach in the obesity treatment sector.
- Expected Drug Efficacy: The subcutaneous formulation of VK2735 demonstrated a mean weight loss of 14.7% over 13 weeks in mid-stage trials, with the CEO expressing hopes that it will be competitive with existing GLP-1 monoagonists, thereby enhancing market competitiveness.
- Market Competition Analysis: Unlike industry giants Novo Nordisk and Eli Lilly, which launched subcutaneous forms of their blockbuster obesity drugs first, Viking's strategy to develop both subcutaneous and oral formulations showcases its diversified approach in the obesity drug market, especially as Novo's oral drug launched in January.
- New Drug Application Plans: Viking is also looking to file an application to initiate trials for a novel amylin agonist this quarter, aiming to expand its obesity portfolio and further strengthen its market position in this therapeutic area.
See More
Patience Rewards: Hims & Hers Soars Following Novo Nordisk Announcement
Stock Surge: After a significant drop of 59% year-to-date, Him & Hers Health's stock surged nearly 46% following a strategic partnership with Novo Nordisk, which will make their weight loss drugs available through telehealth platforms.
Shift to FDA-Approved Drugs: The company is transitioning from compounded GLP-1 offerings to FDA-approved medications, addressing the increasing demand for weight loss drugs while ensuring better safety and quality standards.
Positive Financial Outlook: Him & Hers Health reported a positive earnings surprise with an EPS of 8 cents, exceeding analyst expectations, and is projected to see substantial growth in earnings per share over the next year.
Analyst Upgrades: Following the announcement of the partnership with Novo Nordisk, analysts have upgraded Him & Hers Health's stock rating, indicating a bullish outlook and potential for significant upside in the coming months.
See More
Investment Opportunities in Healthcare Stocks
- Pfizer's Stock Appeal: Pfizer is currently trading at a P/E ratio of 9, significantly lower than the healthcare sector's average of 18.5, making it an attractive option for long-term investors looking to buy before a potential rebound, especially given its robust pipeline.
- Clinical Trial Progress: The company plans to initiate over a dozen phase 3 clinical trials this year, and even with a modest 50% success rate, it is expected to launch several new products that could drive revenue growth and enhance market competitiveness.
- Novo Nordisk's Market Outlook: Trading at 10.5 times forward earnings, Novo Nordisk faces competition from Eli Lilly but has promising candidates like CagriSema that outperform Wegovy, positioning it well in the rapidly growing weight loss market.
- Innovative Drug Development: Novo Nordisk's UBT251 showed excellent results in mid-stage studies in China, potentially becoming the first approved product in the anti-obesity space, and with Wegovy's new label expansions, it could significantly increase market share.
See More
Pfizer and Novo Nordisk Stock Attractiveness Analysis
- Pfizer Stock Valuation: Pfizer is currently trading at a forward P/E ratio of 9, significantly lower than the healthcare sector average of 18.5, indicating its stock is attractive given its robust pipeline that is expected to enhance financial performance.
- Clinical Trial Progress: The company plans to initiate over a dozen phase 3 clinical trials this year, and even with a modest 50% success rate, it is poised to launch several new products, particularly in oncology and weight loss, driving future revenue growth.
- Novo Nordisk Market Competition: Novo Nordisk has lost its leading position in the weight loss market to Eli Lilly, with sales expected to decline in 2026; however, its stock is currently trading at a forward P/E of 10.5, suggesting investment potential.
- New Product Potential: Novo Nordisk's next-gen candidate CagriSema has proven more effective than Wegovy, and its UBT251 showed excellent results in a mid-stage study in China, potentially bringing new growth opportunities in the anti-obesity space.
See More
Novo Nordisk Receives Warning Letter from FDA
- FDA Warning Letter: The US FDA has issued a warning letter to Novo Nordisk, accusing the company of failing to comply with postmarketing adverse event reporting requirements, indicating significant compliance deficiencies that could impact its market reputation and future product approvals.
- Investigation Period: The FDA conducted an investigation from January to February 2025, and despite Novo's multiple written responses, the agency noted that the company did not adhere to applicable statutory requirements and regulations, highlighting serious shortcomings in compliance management.
- Product Impact: With semaglutide as the active ingredient in Wegovy and Ozempic, and liraglutide in Victoza and Saxenda, the FDA's warning could negatively affect the market performance and sales of these products, thereby impacting the company's overall financial performance.
- Compliance Requirements: The FDA mandates that Novo Nordisk develop written procedures to ensure compliance with all applicable regulations for the surveillance, receipt, evaluation, and reporting of postmarketing adverse events, and failure to meet these requirements could lead to further regulatory actions and financial penalties.
See More
