Shares of Novo Nordisk (NOVOb.CO) increased by 3% on Monday as the market responded to data the pharmaceutical provided over the weekend indicating that the heart-protecting advantages of its blockbuster obesity medicine Wegovy are not primarily due to weight reduction. The data was given to suggest that the heart-protective benefits of Wegovy are not entirely due to weight loss.
After Novo disclosed early data from its vast research in August, the data given on Saturday at a major medical convention in the United States gave investors and analysts even more confidence in the cardiac advantages of Wegovy. This came after Novo sent its shares flying 17% on the day to new highs after releasing the preliminary data.
Wegovy, which has been proven to help patients lose an average of 15% of their weight, also lowered the incidence of heart attack, stroke, or death from heart disease by 20%, according to the data disclosed in August from the Danish drugmaker’s Select study. The fact that Wegovy assisted patients in losing weight proved this.
The full findings of the trial demonstrated that the difference in heart risk between individuals who were given Wegovy, which is chemically referred to as semaglutide, and those who were given a placebo began to become apparent practically as soon as therapy had been initiated.
According to Markus Manns, a portfolio manager at Union Investment in Germany and a Novo shareholder, the early cardiovascular benefit was a “positive surprise” that could be an essential differentiator against competing drugs that are being developed by companies such as Amgen (AMGN.O) and Pfizer (PFE.N). Manns made this statement to Reuters.
In a note, analysts from Jefferies stated that even though the medical advantage of Wegovy for obese people with cardiovascular disease is evident from the data, cardiologists in the United States have informed them that they are focused on the high price of the medication. The monthly list price in the United States for Wegovy is $1,000.
The analysts at Jefferies forecasted that the new data would not lead to the payment of Wegovy owing to the cardiac benefit without adopting a measure by the United States Congress that was reintroduced in July and would allow the Medicare health plan to cover these medicines. This bill would allow the Medicare health plan to reimburse these medications.
The legislation in the United States characterizes therapies for weight loss as medications for lifestyle choices and prohibits Medicare from paying for them.
Wegovy belongs to a family of medications known as gut hormone mimickers. This class of pharmaceuticals helps manage blood sugar levels and hunger.
Novo was the first company to bring highly efficient medications for weight loss to the market. Only this past week did authorities in the United States and Britain approve Eli Lilly’s (LLY.N) rival weight-loss therapy, previously approved and marketed as Mounjaro for diabetes. When Friday’s trading concluded on Friday, Novo’s stock had gained 47.5% in 2018.
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