Shares in Novo Nordisk, the Danish agency greatest identified for its Wegovy and Ozempic weight reduction medication, have plunged after it known as a halt to closely-watched trials on a therapy for Alzheimer’s illness.
The corporate had been testing whether or not a key ingredient within the medication might sluggish development of the mind dysfunction.
Novo Nordisk, which started the trials two years in the past, had at all times handled the research as an outdoor guess however one which had the potential to land massive rewards, if profitable, as earnings from its core diabetes/weight reduction area come beneath strain from intense competitors.
Cash newest: UK visitors face new rules
The drug examined was Rybelsus, a capsule authorized just for kind 2 diabetes, which incorporates semaglutide like Wegovy and Ozempic
However shares fell greater than 12% initially in Copenhagen, to lows not seen because the summer season of 2021, when Novo revealed that the deliberate enlargement of the trial, into a 3rd 12 months, wouldn’t proceed.
Martin Holst Lange, chief scientific officer and government vice chairman of analysis and growth at Novo Nordisk, mentioned: “Based mostly on the numerous unmet want in Alzheimer’s illness in addition to a lot of indicative information factors, we felt we had a accountability to discover semaglutide’s potential, regardless of a low chance of success.
Novo’s revenues are more and more threatened by generic alternate options to Ozempic and Wegovy.
“Whereas semaglutide didn’t reveal efficacy in slowing the development of Alzheimer’s illness, the intensive physique of proof supporting semaglutide continues to supply advantages for people with kind 2 diabetes, weight problems, and associated comorbidities,” he mentioned.
Alzheimer’s illness and different dementias have an effect on greater than 55 million folks globally. There isn’t a remedy.
Novo’s shares settled round 9% down on the day, constructing on losses over the 12 months thus far which have now prolonged past 55%.
The share worth response would recommend that some traders had factored in a measure of success from Novo’s trials.
Some market analysts expressed horror over the size of Monday’s share worth decline.
Sydbank’s Soren Lontoft mentioned of the trial’s finish: “Based mostly on the historical past of Alzheimer’s therapy, this does not come as a giant shock to me.
“The share’s response might be extra as a result of dangerous sentiment across the Novo Nordisk share and the detrimental information circulation over the previous 12 months – maybe there was hope for a bit of tailwind from this research.”
