Shares of Novo Nordisk (NVO 1.69%) are tumbling on Monday, down 5.6% as of 2:11 p.m. ET. The drop comes as the S&P 500 (SNPINDEX: ^GSPC) and the Nasdaq Composite (NASDAQINDEX: ^IXIC) both jumped 0.7%.
The Danish pharmaceutical giant's stock fell after it announced it was severing ties with Hims & Hers Health, as well as releasing experimental data for an obesity drug that failed to impress investors.
NYSE: NVO
Key Data Points
Hims & Hers can no longer sell weight-loss drugs
Novo Nordisk announced this morning that it is ending its partnership with Hims & Hers, which allowed the telehealth provider to sell Novo's blockbuster weight-loss drug, Wegovy.
The company said that Hims & Hers had "failed to adhere to the law, which prohibits mass sales of compounded drugs under the false guise of 'personalization,'" alleging that, among other things, Hims & Hers produced its version of the drug using Chinese suppliers never approved by the FDA.
Novo's trial disappoints
Novo Nordisk presented trial results from its trials evaluating the efficacy of CagriSema, another weight-loss drug. Patients with chronic obesity lost an average of 22.7% of their body mass at 68 weeks. While that number is significant, it is less than the 25% the company has been aiming for, disappointing investors.
Despite the disappointment, I think the pharmaceutical company is still in a solid position to continue competing in the uber-lucrative weight loss drug market, although rival Eli Lilly looks to be in a better position at the moment.
