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White House speaking with Novo Nordisk, Eli Lilly about selling some obesity drugs for $149/mo: WSJ
11/5/2025, 12:13:08 PM
Economic Summary
- Novo Nordisk (NVO) lowered its full-year profit and revenue forecast, with its CEO citing slower GLP‑1 growth; this signals a potential deceleration in demand for obesity/diabetes drugs and could pressure near‑term earnings.
- The White House has reportedly discussed with Novo Nordisk (NVO) and Eli Lilly (LLY) a government-run site offering obesity drugs at $149/month with Medicare/Medicaid coverage; that policy could expand access but materially reduce per-patient revenue and margins for manufacturers.
- Intense M&A activity and high valuations in the obesity drug space — Pfizer (PFE) pursuing Metcera (METCERA) with offers reported near $10 billion for a small company — reflect strategic competition and could reshape industry concentration and R&D allocation.
Bullish
- Massive unmet demand for obesity treatments suggests a very large addressable market.
- M&A interest from big pharmas underscores strategic value and potential consolidation upside.
- Government talks to expand access could boost volumes and broaden patient uptake.
Bearish
- Novo Nordisk cut full-year revenue and profit forecasts, indicating weaker-than-expected GLP‑1 growth.
- A proposed government $149/month program for obesity drugs could significantly compress makers' margins.
- Sky-high acquisition bids (around $10B) for small biotechs like Metcera risk overpayment and integration failure.
- Intense competition among drugmakers (Novo, Eli Lilly, Pfizer) may erode pricing power and future growth.
Bullish tickers
NVOLLYPFEMETCERA
Bearish tickers
NVOLLYPFEMETCERA
NVO
Bullish
Market leader in GLP‑1 obesity treatments (e.g., Wagovi) with strong demand and strategic visibility from White House discussions.
Bearish
Novo Nordisk lowered full-year profit and revenue guidance due to weaker GLP‑1 growth and faces potential margin pressure from a $149/month government pricing proposal.
LLY
Bullish
Leader in GLP‑1 therapies benefiting from large addressable market and continued strong demand for obesity treatments.
Bearish
Eli Lilly could see compressed margins if government-run pricing lowers reimbursement levels for obesity drugs.
PFE
Bullish
Acquiring assets like Metcera could bolster Pfizer's obesity pipeline and long-term growth prospects.
Bearish
Pfizer's aggressive pursuit of Metcera entails deal and integration risk, with high valuations potentially reducing transaction returns.
METCERA
Bullish
High takeover interest signals valuable technology or pipeline potential in obesity therapeutics despite current operational scale.
Bearish
Small company with ~100 employees and no approved drugs commanding near-$10B offers, exposing acquirers to clinical and commercialization risk.
People mentioned
Albert BourlaJoeBeckySorkin