Eli Lilly, Novo down after U.S. drug pricing deal

[President Trump Makes Announcement From The White House]
Andrew Harnik/Getty Images News

Shares of Eli Lilly (LLY [https://seekingalpha.com/symbol/LLY]) and Novo Nordisk (NVO [https://seekingalpha.com/symbol/NVO]) fell on Friday after the companies agreed to offer their blockbuster weight-loss drugs at sharply discounted prices in the U.S. as part of a major drug-pricing deal with the Trump administration. [https://seekingalpha.com/news/4517453-eli-lilly-novo-focus-ahead-trump-drug-pricing-deal]

Indiana-based Lilly (LLY [https://seekingalpha.com/symbol/LLY]) ended a six-day winning streak to drop ~3% during afternoon hours, and Novo Nordisk (OTCPK:NONOF [https://seekingalpha.com/symbol/NONOF]) closed as much as ~5% lower in Denmark, extending a multi-day sell-off.

The agreement announced by U.S. President Donald Trump at the White House on Thursday, alongside LLY and NVO CEOs, marked the beginning of Medicare coverage for weight-loss drugs in the U.S. It also gave the companies a reprieve from U.S. tariffs in exchange for billions of dollars of additional investments in the U.S.

However, the highlight of the deal was the duo’s decision to offer their GLP-1 products, Ozempic, Wegovy, Mounjaro, and Zepbound, at significantly discounted prices to Medicare, Medicaid, as well as cash-paying customers, through a government-run website named TrumpRx.

However, despite the price cuts, analysts were positive on the stocks, with Edmund Ingham [https://seekingalpha.com/author/edmund-ingham], SA’s Investing Group Leader for Haggerston BioHealth, arguing it will be particularly beneficial for Novo (NVO [https://seekingalpha.com/symbol/NVO]), which has had to contend with cheaper compounded versions of its weight-loss therapy, semaglutide. “NVO's stock has dropped sharply in 2025, but the new deal could boost long-term revenue by increasing drug accessibility and wiping out compounded competition,” he wrote. [https://seekingalpha.com/article/4840321-eli-lilly-novo-nordisk-historic-glp-1-pricing-deals-what-investors-need-to-know]

While the Danish drugmaker projected a "low single-digit" impact on its global sales growth next year due to lower prices, the company projected bigger product volumes under Medicare in the mid- to long-term.

"The deals are probably more positive than negative for both companies," Reuters reported, quoting Markus Manns, portfolio manager at Union Investment, which has holdings in LLY and NVO. "They are short-term negative, as the price cut will hit [https://www.reuters.com/business/healthcare-pharmaceuticals/novo-nordisk-shares-fall-after-deal-with-trump-slash-obesity-drug-prices-2025-11-07/] immediately, and potentially mid-term positive for the uplift in volumes," Manns said.

Jefferies analyst Akash Tewari issued similar remarks about LLY, on which he has a Buy recommendation. “We think this is a win for LLY & the volume benefit they gain from the Medicare/Medicaid expansion would meaningfully offset the net price reduction,” Tewari wrote, according to Bloomberg News.

Cantor Fitzgerald’s Carter Gould, who has an Overweight rating on LLY, said that the deal will lead to a rapid approval path for the company’s oral obesity candidate, orforglipron, which was selected for the FDA Commissioner’s National Priority Review program on Thursday. [https://seekingalpha.com/news/4517645-novo-nordisk-eli-lilly-oral-obesity-drugs-included-new-fda-priority-voucher-program]

Leading to a potential U.S. approval of the drug in Q1 2026, the deal will open “up a massive pool of Medicare patients that otherwise the company didn’t have straightforward access to under an obesity indication, balanced by greater discounting,” Gould wrote.

MORE ON ELI LILLY, NOVO NORDISK

* Eli Lilly, Novo Nordisk's Historic GLP-1 Pricing Deals - What Investors Need To Know [https://seekingalpha.com/article/4840321-eli-lilly-novo-nordisk-historic-glp-1-pricing-deals-what-investors-need-to-know]
* Novo Nordisk A/S (NVO) Q3 2025 Earnings Call Transcript [https://seekingalpha.com/article/4838202-novo-nordisk-a-s-nvo-q3-2025-earnings-call-transcript]
* Novo Nordisk: Problems Compound, But Stock Still Cheap (Rating Downgrade) [https://seekingalpha.com/article/4838558-novo-nordisk-problems-compound-but-stock-still-cheap-rating-downgrade]
* Eli Lilly's weight-loss drug Mounjaro is India's top-selling drug in October - Reuters [https://seekingalpha.com/news/4518604-eli-lillys-weight-loss-drug-mounjaro-is-indias-top-selling-drug-in-october---reuters]
* U.S. launches pilot payment model to bring MFN pricing to Medicaid [https://seekingalpha.com/news/4518476-us-payment-model-brings-mfn-pricing-medicaid]