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Investing.com -- Novo Nordisk shares surged more than 11% in premarket trading Thursday after Eli Lilly’s data on its oral obesity drug orforglipron underwhelmed investors, prompting concerns over both efficacy and tolerability.
Wolfe Research described the 11.5% placebo-adjusted weight loss achieved by orforglipron at 72 weeks as “modestly below investor expectations of 13–15%.”
Analysts said the study clears a key hurdle but noted that both “weight loss and tolerability came in light.”
The highest dose of orforglipron saw treatment discontinuation rates of 24.4%, while even the lower strength showed dropout rates in the mid-teens.
“We’d flag the 10.3% and 24.4% treatment discontinuation rates... We look to results at EASD, Sept. 17th, to further gauge prescriber sentiment,” Wolfe said, maintaining an Outperform rating on LLY.
Mizuho (NYSE:MFG) analysts echoed concerns about tolerability, calling the outcome “clearly not the ideal outcome here despite [a] good quarter.”
They pointed to a “near 25% patient drop-out rate on the highest dose” and suggested that the unusually high 29% placebo discontinuation rate “almost does not compute.”
Despite the disappointment, Mizuho believes orforglipron still has long-term potential: “11.2% weight-loss for a pill we think is solid given ease of use... maybe more of a consumer product than a drug.”
However, in the near term, the results appeared to benefit Novo Nordisk (NYSE:NVO). “NVO rallying... as investors believe gap between the two has now narrowed to some extent,” Mizuho noted.
Lilly shares are down more than 7% premarket, despite a strong quarter that included $3.38 billion in Zepbound sales and raised full-year guidance.