Novo Nordisk (NYSE:NVO) shares rebounded in Frankfurt on Monday after telehealth provider Hims & Hers Health (NYSE:HIMS) abruptly scrapped the launch of a low-cost, compounded weight-loss pill following an aggressive regulatory warning from the U.S. Food and Drug Administration.
The Danish drugmaker’s stock rose 4.5% on Monday, extending a recovery that began late Friday.
The reversal by Hims & Hers came just 48 hours after it introduced a $49 monthly version of oral semaglutide—the active ingredient in Novo’s Ozempic and Wegovy.
The move sparked an immediate backlash from FDA Commissioner Marty Makary, who over the weekend signaled a federal crackdown on "illegal copycat drugs," citing concerns over patient safety and the lack of clinical verification for mass-compounded alternatives.
Despite the two-day rally, Novo Nordisk remains in the midst of a volatile period.
The company’s market capitalization has eroded by nearly 68% since its June 2024 peak, as investors grapple with the end of the "scarcity premium" for GLP-1 treatments.
Last week, Novo's stock suffered its worst one-day drop in decades—a 17% plunge—after management warned of "unprecedented price pressure" and projected that 2026 sales and earnings could decline by as much as 13% due to intensifying competition from Eli Lilly and the emergence of government-backed discount platforms like TrumpRx.
The regulatory reprieve offers Novo a vital window to establish its own newly launched Wegovy pill, which saw 170,000 patients adopt the treatment in its first month.
However, analysts at Jefferies noted that the "manufacturing moat" for oral GLP-1s is being tested, and the company’s long-term valuation will depend on its ability to maintain its premium pricing tier against an onslaught of cheaper, generic, and compounded alternatives.