Novo CEO Mike Doustdar told CNBC that the pharmaceutical giant is considering M&A opportunities as it faces growing competition in the crowded weight-loss market.
“Let’s see where the gaps are, and let’s go out and see who has produced or is about to introduce better drugs than we are able to do on our own, and when that gap can be filled with M&A, we are actually quite interested about it,” Doustdar told CNBC’s Steve Sedgewick, Karen Tso, and Ben Boulos on “Squawk Box Europe” on Tuesday.
He was speaking after the company faced investor pressure at its Capital Markets Day event on Monday, where it unveiled a turnaround plan that failed to convince markets it was ready to compete when the active ingredient in its weight-loss medication Wegovy starts losing key exclusivity in the early 2030s.
Novo shares over the past 12 months.
Novo was last seen trading just below the flatline, down 0.75%, after falling nearly 8% on Monday, its worst trading day since February.
“I think yesterday we laid out a more clear strategy of the direction we want to take the company at. We talked about diversification of the company, but yet the reaction tells me that there’s still some work to do in convincing some of the investors,” Doustdar said.
The company outlined plans to release over five “multi-blockbuster” drugs by 2030, which it expects to generate more than 150 billion Danish kroner ($23 billion) in sales by 2035. It also guided for revenue growth that is in line with industry peers such as Eli Lilly, AstraZeneca, Amgen, Biogen, Merck, AbbVie, and Novartis.
The plans disappointed investors who were hoping for a “miracle,” especially as its target growth is in line with its peers, signalling slower progress than expected, analysts told CNBC on Monday.
Novo’s key U.S. rival Eli Lilly has captured a large share of the weight loss market with its injectable GLP-1 drugs Mounjaro and Zepbound despite launching years after.
Lilly’s CEO David Ricks told CNBC on Monday that a third of new GLP-1 patients are now taking its oral weight loss pill, Foundayo. “We’re confident long term,” he said.
While Novo’s shares have declined 34% over the past year, Lilly is up just over 54% in the past 12 months.
CNBC’s Elsa Ohlen contributed to this report.
