Ozempic Wars | The Next Injection | 2

0:09It's November 8th, 2023 at Eli Lilly's headquarters in Indianapolis. David Ricks, Eli Lilly's CEO, is speaking with reporters. Ricks smiles. He's here to make an announcement he thinks will finally give Eli Lilly the upper hand against Ozempic maker Novo Nordisk. As of this morning, the FDA has given its approval for ZepBound. ZepBound is Eli Lilly's once-weekly weight management drug, and this approval means the company can officially enter the GLP-1 weight loss battle. Novo Nordisk has had a more than two-year head start with their GLP-1 weight loss drug, Wegovi, but ZepBound could change the game for Lilly.

0:55Ricks continues, We know there's a large group of Americans waiting for answers, and ZepBound has the highest efficacy we've seen in an approved drug so far. Did you catch that? Studies show that ZepBound is actually more effective than Wegovi for weight loss. Later studies confirmed that patients lost around 20 % of their body weight on ZepBound, compared to around 13 % on Wegovi. That might seem like a small difference, but this 7 % could supercharge Eli Lilly's position in the market. Ricks goes on to explain that ZepBound doesn't just mimic the GLP-1 hormone like Wegovi's semaglutide does, Zep Bound's active ingredient, terzepatide, also mimics an insulin hormone called GIP, which not only helps curb your appetite, but is believed to help the body process sugar and fat more efficiently as well.

1:50This dual-pronged approach gives Zep Bound the edge in weight loss. Journalists start peppering Ricks with questions. He smiles, knowing that Zep Bound is about to own the GLP-1 market. That day, Eli Lilly's stock hits an all-time high. Over at Novo Nordisk, CEO Lars Freurigard Juergensen is in his office when the phone rings. It's a journalist who's been covering the company over the years. He tells Juergensen what Rick's told reporters. Juergensen nods. He's been dreading this moment for months. He's been tracking how well ZepBound has been doing in clinical trials. and Eli Lilly's pricing it at around$1 ,000 a month, which makes it about$300 cheaper than Wegovi.

2:44Juergensen turns on the news, and a moment later, he watches as an anchor breaks the ZepBound announcement. Suddenly, his office feels stuffy. Between the semaglutide shortage, the compounding pharmacies, and now ZepBound, Juergensen knows it's just a matter of time before Novo Nordisk's stock takes a big hit.

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5:17From Wondery, I'm David Brown, and this is Business Wars.

5:32The End

5:45When pharmaceutical giant Novo Nordisk first started developing GLP-1 drugs in the 1980s, they thought they had a game-changing diabetes treatment on their hands. But they soon realized they could change even more lives and perhaps reshape their company's future by using semaglutide for weight loss as well. As demand for semaglutide exploded in the early 2020s, Novo Nordisk became the most valuable corporation in all of Europe. But their main competitor, American pharmaceutical giant Eli Lilly, was right behind them, developing their own GLP-1 drug for weight loss. That drug became ZAP-bound, and early studies produced better results than Novo Nordisk's version.

6:34And while Novo Nordisk was the first to market with its weight loss product, Eli Lilly is quickly gaining on them. The two longtime competitors are now locked in a battle not just for market share, but also for public perception of their weight loss drugs. They're racing to release newer, more effective, and more cost-affordable versions, while also looking to enter new arenas. Both companies are pushing ahead with additional research and development, each hoping to expand their breakthrough medications beyond weight loss to treat other diseases. And each one is determined to get there first. This is Episode 2, The Next Injection.

7:23It's January 2024, and with FDA approval of ZepBound in hand, Eli Lilly launches a new service designed to boost sales even more. It's called Lilly Direct, and it's a direct-to-consumer online sales platform. Instead of scheduling a doctor's appointment, getting a prescription, and heading to the pharmacy, patients can just go online, meet a prescriber virtually, and have ZepBound delivered straight to their homes. You see what's happening here? You know, sometimes how you sell can matter more than what you sell. Direct sales lets you simplify choices, trim fees, talk to the customer, without having to rely on intermediaries who may have their own business agendas.

8:07You know, there's an important but often overlooked lesson here. If you face copycats, pair a trusted name with easier access and watch the loyalty follow. Bottom line, sometimes the best strategy isn't a new product, but a new path to the same product. In August 2024, Eli Lilly makes another stunning announcement. It will start selling lower doses of ZepBound in vials rather than preloaded shots. This move lowers the price for a month's supply from around$1 ,000 a month to around$500 a month, which puts Eli Lilly's pricing much closer to its off-brand competitors. Compounded versions of terzepatide, ZepBound's main ingredient, typically cost between$250 and$450 a month.

8:59But Eli Lilly has something those versions don't, the benefit of being a name brand with consumer trust and FDA approval. With these changes, Eli Lilly projects a 30 % jump in annual revenue up to roughly$45 billion for 2024. Over at Novo Nordisk, the pressure is mounting, and its troubles are only just beginning.

9:30Education, Labor and Pensions Committee will come to order. It's September 2024, and Lars Freurgaard-Jergensen is sitting in front of a U.S. Senate committee on Capitol Hill. Inside the hearing room, Vermont Senator Bernie Sanders props up a huge chart on a tripod behind him. It lists the cost of Wegovi in other countries. And then Senator Sanders begins his remarks. The issue that we are discussing this morning is not complicated. It has everything to do with the chart behind me, which shows that Novo Nordisk drug, Wegovi, is sold for$265 in Canada,$186 in Denmark,$137 in Germany, and$92 in the United Kingdom.

10:23Sanders' chart shows that Wegovia is still around$1 ,300 a month. That's more than 14 times the price in the U.K. Sanders says this discrepancy is immoral, an example of corporate greed. He continues, delivering a pointed message for Jurgensen. Novo Nordisk has developed game-changing drugs, which, if made affordable, can save the lives of tens of thousands of Americans every year and significantly improve the quality of life of millions more, if made affordable. Nobody here is asking Novo Nordisk to provide charity to the American people. Novo Nordisk has already made billions of dollars in profit off of these products and in the coming years will make billions more.

11:16All we are saying, Mr. Jorgensen, is treat the American people the same way that you treat people all over the world. Stop ripping us off. During the hearing, Jorgensen tries to argue that the reason Ozempic and Wegovi are so expensive in the United States is because the pricing is actually out of Novo Nordisk's control. Juergensen places the blame on the U.S.'s complex health insurance system and specifically calls out PBMs, pharmacy benefit managers. You may have heard about these. They're usually in the news because critics believe these middlemen are jacking up prescription drug prices. PBMs are supposed to act as negotiators between pharmaceutical companies, insurers, and patients.

12:05They were started back in the 1960s to help insurers manage drug costs. But as they've merged and become more powerful, critics say they may now be driving prices up instead of keeping them down. Jorgensen says that if Novo Nordisk lowers the price of these drugs, the PBMs might remove them from their lists of medications covered by insurance. But PBMs aren't the only factor. During his testimony, Jorgensen says, quoting here, We don't decide the price for patients. That's set by the insurance companies. But Bernie Sanders has a counter-argument prepared. He lifts up a stack of papers and tells Jurgensen that he's holding a list of commitments in writing from all the major PBMs in the country.

12:51And every single one of them has said they won't restrict coverage for Ozempic and Wegovi if Novo Nordisk agrees to lower their list prices. Sanders says that the high prices aren't the PBM's fault. It's because Novo Nordisk refuses to play ball. Jurgensen was not expecting this maneuver. Few companies think of lawmakers as a target market, right? But make no mistake, in highly regulated industries like healthcare, there are many in the government who can sell a story about you. We've seen this more and more in recent years, a narrative about fat cat pharmaceutical companies out of step with the needs of everyday people, right?

13:33Well, complicated explanations and spreadsheets from a corporate bigwig won't cut it in a Senate hearing room. You got a choice. Build headline-safe pricing or prepare to face the consequences. In every industry, political risk is a customer risk with a microphone. You control the narrative early or someone else will write your tagline. And that sure seems like what just happened here. The blowback. is bitter. Now, Juergensen is desperate to prove he can keep Novo Nordisk on top and somehow find a way to lower costs without undercutting profits. But just as Juergensen pushes to expand access, a new FDA move threatens to tighten the market, and new research sparks fresh questions about just how safe these drugs really are.

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16:29It's October 2nd, 2024. The FDA puts out a statement removing terzepatide, the key ingredient in Eli Lilly's ZepBound, from their official shortage list. That means compounding pharmacies can no longer make their own versions of the drug. This is bad news for Juergensen because while Eli Lilly has amped up its production, Novo Nordisk is still struggling with shortages of its main GLP-1 hormone, semaglutide. Novo Nordisk has been spending billions of dollars trying to keep up with demand. Earlier in the year, they purchased three factories for$11 billion, and in June, they announced plans for a new manufacturing facility outside Raleigh, North Carolina.

17:13but it won't be up and running until sometime between 2027 and 2029. Meanwhile, demand still far exceeds their supply, which means Novo Nordisk can't get off the FDA's shortage list. So, Novo Nordisk decides to try a different tactic to narrow the playing field, asking the FDA to ban compounding pharmacies from making copycat versions of semaglutide. Novo Nordisk argues that semaglutide is too complex a drug to be replicated safely and points to the dozen lawsuits they've already filed. The company says some of these compounded drugs are laced with impurities and could be unsafe for patients. You see what Novo Nordisk is doing here?

17:59When a market gets flooded with knockoffs, the temptation is to fight them in court. But you've got to consider this too. Lawsuits can sometimes be another form of advertising. After all, they keep your rival's name in circulation. A smarter play might be to compete on clarity. Make your offer so trustworthy and simple that the copies look risky by comparison. You can't litigate your way into customer loyalty, but you can earn it by removing doubt faster than your lawyers can file motions. To others, like Scott Brunner, the head of a compounding pharmacy trade group, Novo Nordisk's move looks like one made out of, quote, desperation.

18:44While Novo Nordisk waits for the FDA to make a decision, prescriptions for off-brand drugs continue to grow. Meanwhile, both Novo Nordisk and Eli Lilly keep working towards building their next generation of weight loss drugs. This next wave marks a shift. Their new drugs combine multiple synthetic hunger hormones in an effort to push weight loss results even higher. In December 2024, Novo Nordisk publishes the results of late-stage trials for Cagre-Sema, a new drug that combines semaglutide with Cagre-Lentide, which mimics another hunger hormone. Novo Nordisk wants to dominate the anti-obesity market, and they've been working on a successor to Wigovi.

19:30Ideally, one that will perform better than their rival's drug, ZepBound. The results are promising, but they don't quite live up to the hope or the hype. Patients on Cagra Sema only lost about 23 % of their body weight instead of the 25 % investors had expected. Novo Nordisk shares plunged 22 % following this news. One portfolio manager calls this a worst-case scenario for the company, saying that, quote, Cagrasema is only as good as ZepBound but more complex to manufacture.

20:11That crash shows the brutal truth of R &D. Investors aren't buying science, they're buying momentum. Even pretty good results can tank a stock if expectations are overinflated. Every founder faces this problem. You promise them the moon, and you're punished for reaching the stratosphere. Happens all the time. The fix? Try to manage expectations, like a product launch, under-promise, over-deliver, and save the fireworks for the moment you actually clear orbit. Still, a 23 % body weight loss is well above Wegovy's current average of around 15%. And the race to make even better, more effective versions of these drugs continues.

20:57Eli Lilly is already putting its new version through trials. Their new drug, retatratide, targets three hunger hormone receptors. It's being nicknamed Triple G, and earlier trial results from 2023 showed a 24 % reduction in body weight over the course of nearly a year. NovoNordisk is in a tough spot. While Eli Lilly chases the next big breakthrough, compounding pharmacies are still eating away at the Danish multinational's market share, and some of those smaller challengers are willing to spin big to capture the public's attention. For Jurgensen, it's starting to look like a no-win situation.

21:43In February 2025, the startup Hims & Hers Health buys a minute-long Super Bowl ad to promote their compounded version of semaglutide, pitching it as the affordable answer to America's obesity epidemic. Something's broken. It's not our bodies. It's the system. They're medications that work, but they're priced for profits, not patients.

22:09Juergensen sees the commercial, and he knows that an estimated 127 million other people did too. Most will assume there's no real difference between Wegovy and this compounded version. It's the same problem he's been fighting for months, only now it's playing out in front of the largest TV audience in the U.S., with price tags as low as$199 for a one-month supply of injections and$79 for a pill. Later that month, Novo Nordisk finally gets some good news. The FDA announces that the semaglutide shortage is officially over. Novo Nordisk is finally able to keep up with demand. This means the compounding pharmacies who have been mimicking Wigovi for more than a year now have 60 to 90 days to shut down.

23:00At least, that's what they've been ordered to do. But Juergensen knows enforcement won't be easy. And it'll be even harder to convince patients to give up the cheaper versions they've already come to trust. In March 2025, Novo Nordisk launches NovoCare Pharmacy, a direct-to-consumer method of selling Wegovi. They copied Eli Lilly's model and are able to bring the price of Wegovi down to just$499 a month. Problem is, nobody's paying much attention. The spotlight is still on startup brands selling compounded versions of GLP-1s because they're cheaper and, frankly, better advertised. Still, Novo Nordisk gets a small win that month.

23:49The company's full membership in ABPI, Britain's Pharmaceutical Trade Association, is reinstated after a previous ethics violation. But in April, Eli Lilly pulls ahead again when they publish promising results for an oral version of ZepBound, an easier and more painless way to take GLP-1 medication. When they make this announcement, their stock jumps about 14 percent, while Novo Nordisk's stock sinks by more than 7 percent. On April 29th, Novo Nordisk tries to change the narrative. The company announces a new partnership with HIMS & HERS Health. That's the startup that advertised on the Super Bowl.

24:32Hims & Hers has basically become the most well-known provider of GLP-1 medications, thanks to low prices and aggressive marketing. Jurgensen and the Novo Nordisk leadership team decided that if they can't steal the spotlight, they may as well share it. Novo Nordisk will supply Wigovi through Hims & Hers the same way as it sells through NovoCare for just$599 a month. It's a bold move, and one that captures some media attention. Now that's an unexpected pivot, don't you think? Teaming up with a disruptor who's been eating your lunch? You know, in business, co-opting a rival's megaphone can go two ways.

25:11It can be brilliant or disastrous. If the partner defines the brand louder than you do, well, congratulations. You just rented out your credibility. Partnerships really only work when both sides are guarding the message with the same kind of care. Otherwise, the leading brand is lending trust to someone else's marketing department. Juergensen watches their stock rise from$60 a share to$64 by closing. It's not quite the boost that Eli Lilly enjoyed a few weeks ago, but he'll take it.

25:47It's May 16th, 2025, and Lars Freurgaard-Jurgensen is logging on to a Microsoft's team call with Novo Nordisk chairman Helga Lund. He adjusts his notes and prepares for a routine catch-up. But right away, the tone of the conversation feels off. Lund doesn't lead with small talk. Instead, he gets right to the point. Lars, we need to discuss the future leadership of Novo Nordisk. Juergensen frowns. Future? Leadership? He thought this call was about strategy, projects, maybe a future product launch. Lund continues. The board has decided it's time for a new CEO. The words hit like a punch. Juergensen barely has time to process what's happening.

26:36After all he's billed, including$26 billion mega hits like Ozempic and Wegovy, he's being shown the door. Juergensen knows the company's been struggling lately. Share price has dropped 53 % over the past year. Compounding pharmacies have been undercutting their prices with copycats, and they've had setbacks in their next-generation trials while Eli Lilly has been racing ahead. But the decision to remove him as CEO takes him completely by surprise. The call ends, and Jurgensen tries to steady himself. He'd expected a discussion, maybe even criticism, but not this. Later, he learns that the board leaked the news to the media before even telling him.

27:21The message is clear. The company needs a new direction and a leader who's up for the challenge of matching Eli Lilly's pace. But this isn't the only partnership that Novo Nordisk is ending. In June 2025, Novo Nordisk cuts ties with hims and hers, and the breakup is not pretty. The company says the telehealth platform is continuing to sell compounded versions of Wegovi, even though the FDA has ordered compounding pharmacies to stop this practice. They also accuse hims and hers of using deceptive marketing tactics and putting patient safety at risk. Dave Moore, Novo Nordisk's executive vice president of U.S.

28:04operations, tells CNBC, quoting here, Our expectation was that him and hers' business focus would transfer toward real, safe, approved medications. When we didn't see that, we had to make a choice on behalf of patients. Hims and hers fires back. Their CEO, Andrew Dudham, says that Novo Nordisk is, quote, misleading the public and claims the drugmaker had pressured them to stare patients toward Wegovi, even when it wasn't their best clinical option. He adds that his company refuses to be strong-armed and will continue offering patients a range of treatments, including Wegovi. As the public dispute plays out, Novo Nordisk's stock price continues to tumble.