Novo Nordisk (NVO) just agreed to shell out up to $2 billion for the global rights to a Chinese weight-loss drug—and the market wasn’t thrilled. The company’s U.S.-listed shares dropped 2.2% on Monday after the announcement.
Novo Signs Global Deal for Early-Stage Drug
The Danish drugmaker, best known for its blockbuster Ozempic and Wegovy, is teaming up with China’s United Laboratories International to license a drug called UBT251. It’s an early-stage “triple agonist” that targets GLP-1, GIP, and glucagon receptors—basically mimicking key hormones to regulate blood sugar and boost insulin.
Novo will pay $200 million upfront, plus up to $1.8 billion in future milestone payments, to develop and sell the drug outside of China, Hong Kong, Macau, and Taiwan.
Novo Nordisk Stock Dips on Pricey Bet and Drug Risk
While the move could eventually expand Novo’s GLP-1 dominance, investors weren’t sold. UBT251 is still in early clinical development, which means a long (and uncertain) road ahead. That explains the dip in Novo’s stock, even as the broader market ticked up.
Is Novo Nordisk a Buy, Sell, or Hold?
Analysts remain cautiously optimistic about NVO stock, with a Moderate Buy consensus rating based on five Buys and five Holds. Over the past year, NVO has decreased by more than 35%, and the average NVO price target of $111.79 implies an upside potential of 45.5% from current levels.
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