Shares of Danish pharmaceutical giant Novo Nordisk experienced a significant decline following comments made by President Trump regarding potential price reductions for the popular weight-loss medication Ozempic. During a press conference at the White House, Trump indicated that the drug, which currently carries a monthly cost of approximately $1,000, could see its price drop to around “$150 out of pocket.”
The announcement came during an event focused on a separate agreement with German pharmaceutical company Merck KGaA regarding fertility treatment pricing. When questioned about the timeline for these price reductions, Trump stated they would occur “pretty fast,” though Centers for Medicare and Medicaid Services head Mehmet Oz quickly clarified that negotiations for Ozempic pricing were still in progress and had not been finalized.
The market responded swiftly to Trump’s remarks, with Novo Nordisk’s stock falling 7% on the Copenhagen exchange. This decline comes after the company had recently experienced positive momentum following favorable study results presented at the European Association for the Study of Diabetes last month.
BMO Capital Markets analyst Evan Seigerman addressed the situation in a note to clients, characterizing Trump’s statements as “aggressive posturing” in ongoing negotiations. However, Seigerman suggested that the eventual negotiated price might not fundamentally alter Novo’s business model.
The company continues to face challenges in the U.S. market, particularly regarding compounded GLP-1 drugs. Earlier this year, Novo terminated its partnership with telehealth provider Hims & Hers Health following allegations of federal law violations. These violations reportedly involved the mass production of compounded drugs marketed as personalized treatments, along with questionable marketing practices that potentially compromised patient safety.
Market analysts are now watching closely to see if Novo’s stock will test the 300 DKK level, as the latest developments add another layer of uncertainty to the company’s 16-month bear market. This situation represents a significant shift for the pharmaceutical manufacturer, which had previously enjoyed strong market performance and support from major financial institutions, including Goldman Sachs, who had maintained a bullish stance on the stock.
The development signals potential broader implications for the GLP-1 drug market, which has seen substantial growth in recent years due to the increasing demand for weight-loss and diabetes medications. Trump’s comments about price reductions could indicate a more aggressive approach to pharmaceutical pricing negotiations under his administration, potentially affecting other drugs in this category.
Industry observers note that while Trump’s stated price target of $150 represents a dramatic reduction from current levels, the final negotiated price could differ significantly. The timing and
implementation of any price changes remain uncertain, as Dr. Oz’s comments suggest that formal negotiations have yet to begin in earnest.
The situation highlights the ongoing tension between pharmaceutical companies’ pricing strategies and political pressure to reduce healthcare costs. It also demonstrates the market’s sensitivity to potential regulatory changes and price negotiations, particularly for high-profile medications like Ozempic that have generated significant revenue for their manufacturers.
Financial markets continue to monitor the situation closely, as any substantial price reductions could impact not only Novo Nordisk but potentially set precedents for pricing negotiations across the pharmaceutical industry.