Novo Nordisk CEO Lars Fruergaard Jorgensen is stepping down as competition in the weight-loss drug space pressured the company’s stock.
“Considering the recent market challenges, the share price decline, and the wish from the Novo Nordisk Foundation, the Novo Nordisk Board and Lars Fruergaard Jørgensen have jointly concluded that initiating a CEO succession is in the best interest of the company and its shareholders,” the company announced on Friday.
The company commended Jorgensen for his leadership, crediting him for Novo Nordisk’s sales, profits and share price almost tripling during his eight-year tenure as CEO. However, the company’s stock has taken a massive hit since 2024.
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Shares declined more than 50% over the past year, wiping more than $300 billion off its market value. The pharmaceutical giant has been racing against rivals such as Eli Lilly to dominate the highly lucrative weight-loss space.
Morgan Stanley Research is projecting that the global market for obesity drugs will reach between $105 billion and $144 billion in 2030. That’s up from an earlier projection of $77 billion. In 2023, sales of branded obesity drugs notched $6 billion alone.
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Novo Nordisk’s Wegovy, approved by the FDA for chronic weight management in 2021, was the first time a single medication was available that helped patients shed more than 10% of total body weight, according to BMO Capital Markets.
While it marked a milestone, Lilly has been rapidly catching up with its version, Zepbound, which was approved in 2023 and shows greater results for weight loss.
Novo Nordisk also manufactures Ozempic, which is FDA-approved for the treatment of type 2 diabetes and in competition with Lilly’s Mounjaro, which was approved in 2022 for the treatment of type 2 diabetes.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| NVO | NOVO NORDISK A/S | 63.42 | -2.74 | -4.14% |
| LLY | ELI LILLY & CO. | 733.29 | +17.73 | +2.48% |
Jorgensen will remain in his position as the search for his successor continues. The company said he will remain as CEO to “support a smooth transition to new leadership” when his successor is chosen. The search for his replacement is ongoing.
During his tenure, the company has grown tremendously, fortified its leadership in diabetes care, established itself as a pioneer in the treatment of obesity and diversified into other areas of serious chronic diseases.
Lars Rebien Sorensen, chair of the Novo Nordisk Foundation, will also join the Novo Nordisk board.
