Shares of Danish pharmaceutical company Novo Nordisk rose in early trading on Friday, clawing back some of the value lost over the previous two sessions after a pledge from the U.S. Food and Drug Administration to confront the mass-marketing of unapproved medicines.
Investors had pushed the stock down sharply earlier in the week amid two converging pressures. The company’s shares plunged nearly 8% on Thursday after telehealth provider Hims and Hers Health introduced a compounded version of Novo Nordisk’s FDA-approved Wegovy weight-loss injection priced at $49. The product was presented as a lower-cost alternative to the branded drug.
In response to growing concern about such copycat products, FDA Commissioner Marty Makary posted on X that "FDA will take swift action against companies mass-marketing illegal copycat drugs, claiming they are similar to FDA-approved products." He added, "The FDA cannot verify the quality, safety or effectiveness of non-approved drugs." The commissioner did not name any firms in the post.
Earlier in the week Novo Nordisk had issued a warning that it is facing unprecedented price pressure on its weight-loss medicines and announced a reduction in its full-year forecast. That guidance revision led to a further market reaction and at one point triggered a 17% slump in the company’s share price.
Despite the earlier declines and the company’s warning, by 0848 GMT the shares were up 4.9% at 294.50 Danish crowns, equivalent to $46.50. The stock’s recent troughs put it close to levels not seen since Wegovy was introduced in June 2021.
Market participants are weighing the twin forces of competitive pricing pressure from compounded alternatives and regulatory intervention aimed at curbing the promotion of non-approved drugs. The FDA’s statements seek to underscore the agency’s inability to vouch for the quality, safety or efficacy of these unapproved formulations and to signal potential enforcement action against companies that promote them heavily.
Context note: The above reflects market movements and statements disclosed publicly by the FDA commissioner and the company, along with the pricing and trading figures reported for Novo Nordisk shares.