Novo Nordisk announced Friday that CEO Lars Fruergaard Jørgensen will step down, ending an eight-year tenure as the company faces mounting pressure in the increasingly crowded obesity drug market.
The Danish pharmaceutical firm, best known for its weight-loss treatment Wegovy, said Jørgensen will stay on for a period to ensure a smooth leadership handover. The search for his replacement is underway, with an announcement expected soon.
Shares of Novo Nordisk fell 1.8% following the news, while rival Eli Lilly saw a 1.7% gain. The shift in leadership comes as Novo’s stock has slumped more than 50% since mid-2024, weighed down by competitive pressures and lackluster clinical results from its next-generation drug pipeline.
Board Chairman Helge Lund said the leadership change followed several weeks of internal discussions between the company and the Novo Nordisk Foundation, which holds a controlling stake. However, Jørgensen told Danish broadcaster TV2 he had only recently been informed and was caught off guard by the decision.
“The company’s strategy remains intact,” Lund said in a statement, but acknowledged that the board took action in response to recent setbacks and investor concerns.
The announcement comes after Novo revised its full-year sales forecast, citing weaker-than-expected first-quarter earnings for Wegovy. Sales dipped as U.S. pharmacies ramped up supply of compounded versions of weight-loss drugs, cutting into Novo’s market share.
“Compounders took a part of our business away,” Jørgensen told CNBC’s Charlotte Reed in an interview earlier this month.
Novo expects sales to rebound in the second half of 2025 as compounded drugs lose ground following the FDA’s decision to lift its shortage designation.
In another leadership move, former CEO Lars Rebien Sørensen, now chair of the Novo Nordisk Foundation, will return to the company board as an observer.
Novo also faces pressure over its next-generation obesity candidate, CagriSema. The treatment, once touted by Jørgensen as potentially best-in-class, has fallen short of investor expectations in early trials.
Despite the challenges, Jørgensen remained hopeful about the drug’s future. “From the data we have, CagriSema is the best product that has been tested or is on the market,” he previously said.
The leadership transition marks a pivotal moment for Novo Nordisk as it works to regain investor confidence and sharpen its competitive edge in one of the fastest-growing sectors in healthcare.
Related Readings:
#Novo #Nordisk #CEO #Exits #Obesity #Drug #Pressure