Novo Nordisk

Company Update:
The Q3 26 sales and adj. operating profit (excluding the 340B provision reversal) were c.8% and c.12% ahead of the street’s expectations. Sales were c.4% higher than our estimates. As we had conjectured in August 2026, the firm again upgraded its full-year guidance.

Sales came in at DKK79.2bn, increasing c.4% at constant exchange rates (CER) and c.6% reported, 8% better than consensus (and 4% ahead of our own numbers) After the launch in early 2026, the Wegovy pill (for weight-loss) garnered DKK5.4bn in sales, as it was responsible for majority of the Q3 growth and even consensus beat. On the other hand, injectable Wegovy, and the GLP-1 diabetes drugs (injectable Ozempic and Ozempic pill) saw declining sales in Q3, marred by pricing pressure and intense competition from Eli Lilly.

Q3 adj. operating profit jumped 27% to DKK31.7bn, roughly 12% better than consensus. 

FY26 guidance raised: adj. sales (excluding the benefit from reversal of 340B provisions) and adj. operating profit growth between -2% and +2% each (vs. -6% to 0% previously).

Sales and operating profit for 2026 will be positively impacted by a reversal of sales rebate provisions of $4.2bn related to the 340B Drug Pricing Program in the US.

Overall, these results should provide some relief for Novo’s beleaguered investors. The firm may return to a better growth from 2027 onwards and we see promising obesity/diabetes assets in Novo’s pipeline as well, however, Novo’s management in on the clock to diversify its offerings and avoid any patent cliff situation when Wegovy/Ozempic lose patents from 2031 onwards.

With the kind of resources it has at disposal, we consider Novo as significantly undervalued, and we now see a sense of urgency in its commercial efforts.

As a reminder at the beginning of the year NOVO expected a range of organic decline in the [5% 13%] range. That has been upgraded all year and we now stand between -2% and +2% (and we are likely to have another strong perf in Q4).  Like Eli Lily, numbers are substantially better than expected. It is very possible that the size of the addressable market is actually substantially higher than what we all have in mind (which is already massive with 1bn people obese and another 1bn overweight). Still a duopoly for a while and Novo's valuation is still  assuming VERY negative outcome on obesity and weight loss market which isn't at all our scenario. Still very long Novo.  Announcement of the replacement of CFO by the one of Galderma is the only uncertainty in a very positive release overall.