In the summer of 2024, the downtrend in obesity drug stocks started. Lilly (LLY) fell from around $1000 to below $700. By August, the stock hit a $623.78 low. Its competitor, Novo Nordisk (NVO), based in Denmark, peaked at nearly $150 last year. NVO stock, however, is still near a 52-week low.
LLY stock is the stand-out winner. The company reached a $1 trillion valuation last Friday. This is the first drugmaker to do so. The stock gained 35% in 2025, driven by its strong growth in weight-loss drugs.
Lilly has an effective obesity drug. Tirzepatide, known as Mounjaro to the public, treats type 2 diabetes. Zepbound treats obesity.
Lilly outflanked Novo despite the latter firm leading the obesity drug market at first. In 2021, Novo’s Wegovy failed to capitalize on the obesity drug demand craze. It suffered from a supply shortage. This let Lilly catch up. Moreover, Lilly’s drug is more effective. The combination of efficacy and production scaling up gave LLY stock the boost.
NVO stock risks re-testing new lows. Markets depend on Novo to release an effective oral drug. This is likely and should help the stock rebound. But manufacturing issues might limit Novo’s distribution capabilities.
Related Stocks
Investors may consider AbbVie (ABBV), which managed its patent expiry well over the last five years. Merck (MRK) and Bristol-Myers (BMY) are underperforming drug stocks. Pfizer (PFE) has a history of making poor acquisitions. That keeps the stock in a $25 support zone.
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