Danish drugmaker Novo Nordisk (NVO) saw a 40% jump in the sales of its diabetes and weight-loss drugs in April in India, despite intense competition from generic GLP-1 offerings, Bloomberg reported. The surge in the company’s sales was driven by steep price cuts.
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Trade AMZN with leverageNovo Nordisk’s Price Cuts Boost Sales in India
Effective April 1, Novo Nordisk cut the prices of the starting doses of Ozempic and Wegovy by 36% and 48%, respectively. This brought down the price of these drugs to 5,660 rupees or about $60.
These price cuts enhanced the affordability of Novo Nordisk’s drugs and helped the company defend its market share against generic rivals. According to market research entity Pharmarack, sales of Wegovy, Ozempic, and partner-branded versions reached 32,000 units in April. Sales of cheaper versions of these drugs helped expand the market by 56% from the previous month to 414,000 units in April. Interestingly, despite an initial struggle, Eli Lilly (LLY) continued to lead the market in April as India’s top-selling provider of GLP-1 drugs.
Sheetal Sapale, vice president of commercial at Pharmarack, thinks that the solid April sales indicate that Novo Nordisk and Eli Lilly (LLY) will remain the “preferred choice for a class of patients and doctors.”
It is worth noting that India is the first country where Novo Nordisk faces generic competition for semaglutide, the active ingredient in Ozempic and Wegovy. It will give the company an idea of what to expect as generics start to hit other markets. Meanwhile, the demand for GLP-1 drugs is growing rapidly. On Thursday, Amazon (AMZN) announced that its Amazon Pharmacy is expanding access to Novo Nordisk’s Ozempic pill via same-day delivery and pickup at in-office kiosk locations soon.
Is NVO Stock a Buy, Sell, or Hold?
On Wednesday, Novo Nordisk raised its full-year outlook, driven by improved expectations for GLP-1 product sales. The company now expects adjusted sales and profit to contract by 4% to 12% on a currency-adjusted basis, an improvement from its previous outlook of a 5% to 13% decline.
Given intense competition and some setbacks over the past year, Wall Street has a Hold consensus rating on Novo Nordisk stock based on seven Holds and one Buy. The average NVO stock price target of $41.20 indicates a 9.5% downside risk.
