Novo Nordisk CEO Maziar Mike Doustdar on a second quarter earnings call argued that failure is par for the course in the drug development business. The Danish pharma is focused on building out its pipeline to move past recent clinical roadblocks.
To bounce back from a series of clinical stumbles, Novo Nordisk is leaning heavily on its innovation engine and an early-stage pipeline that could set the pharma up for long-term growth.
“We stay alive—or not—based on our ability to innovate,” Doustdar told reporters during a press call early Wednesday morning to present the Danish pharma’s second quarter earnings results. He additionally alluded to “really good early signs” of innovation but declined to provide further details “because they’re early pipeline products.”
Still, Doustdar appeared to be highly confident in these up-and-coming prospects. “In terms of the magnitude of the assets and areas we would like to operate in—as well as the speed of operations—we will be second to none,” he said.
These assertions come just days after Novo suffered a surprise late-stage blow when the IL-6 inhibitor ziltivekimab failed the Phase 3 ZEUS trial, unable to significantly lower the risk of major adverse cardiovascular events in patients with atherosclerotic cardiovascular disease, chronic kidney disease and inflammation.
Ziltivekimab is a key part of Novo’s strategy of branching out to obesity-adjacent indications, looking to stand out in the cardiometabolic arena as key rival Eli Lilly cements its leadership status in the weight loss game.
In February, Novo suffered back-to-back defeats at the hands of Lilly, with two head-to-head trials pointing to the superiority of the Indiana pharma’s assets. The Phase 3 REDEFINE 4 trial, for instance, showed that Novo’s next-generation obesity candidate CagriSema elicited weaker weight loss than the FDA-approved Zepbound. Then, the late-stage ACHIEVE-3 study demonstrated that Lilly’s Foundayo led to better blood sugar control and weight reduction than Novo’s oral semaglutide.
Doustdar on Wednesday’s call didn’t seem too bothered by these events. “It’s true that we have had a couple of setbacks recently on R&D,” he told reporters. “But that’s part of, and the nature of, this industry. If you don’t like setbacks and you don’t like failure, don’t get into the pharma industry.
“We need to learn from the failures and reinvent ourselves again,” Doustdar continued, noting that for each of these setbacks, Novo is working to “demonstrate that we can progress multiple times more the innovations and bring them into the hands of the patients.”
To this end, the CEO on the call also confirmed that Novo is on the lookout for external opportunities. “I believe strongly that we need bolt-on acquisitions to complement what we are doing ourselves,” he said.
In house, the Danish giant had some clean up to do around the edges of the pipeline. The pharma revealed that it had ended work on the oral cannabinoid receptor blocker monlunabant, which was in mid-stage development for obesity. The drug came from Novo’s $1 billion acquisition of Inversago Pharma in August 2023. In September 2024, Novo revealed that the drug had spurred weight loss in a Phase 2a trial but also reported mild- to- moderate neuropsychiatric side effects.
In the second quarter, Novo reported net sales of DKK 78.5 billion ($12.1 billion), representing a 3% year-on-year increase and landing ahead of analysts’ expectations. Delivering a narrow miss, however, was oral Wegovy, which made DKK 3.22 billion ($496 million) in the quarter, 2% below consensus.
U.S.-listed shares of the company slid nearly 6% before the opening bell on Wednesday to $44.28.
Nevertheless, Novo’s strong performance in the first half of the year, particularly within the GLP-1 franchise, emboldened the pharma to lift its full-year outlook. The Danish drugmaker now expects sales to remain flat or drop by just 6%, as opposed to prior guidance of a 4% to 12% decrease.
