Novo Nordisk: Trial Failure Disappointing, but Insignificant Portion of Our Forecast

Key Morningstar Metrics for Novo Nordisk

• Fair Value Estimate
  : DKK 311
• Morningstar Rating
  : ★★★
• Morningstar Economic Moat Rating
  : Wide
• Morningstar Uncertainty Rating
  : High

Phase 3 cardiovascular outcomes study Zeus, testing IL-6 antibody ziltivekimab in patients with cardiovascular and kidney disease, did not show a reduction in major adverse cardiovascular events relative to a placebo arm. Novo Nordisk NOVO B shares in Copenhagen fell 7% on July 31.

Why it matters: With pricing and competitive pressures on Novo’s existing semaglutide business and mixed data for pipeline diabetes and obesity drug cagrisema, investors are looking for new ways for Novo to expand in cardiometabolic therapeutic areas. This likely closes one potential avenue.

The bottom line: We’re maintaining our DKK 311/USD 48 fair value estimate for wide-moat Novo Nordisk. We think shares look roughly fairly valued following their decline on July 31.

• We were more skeptical than consensus estimates on this program overall, as making the leap from anti-inflammatory biomarker trends to real patient outcomes wasn’t guaranteed, and this molecule would have represented a new mechanism of action in this field.
• We had included less than USD 700 million in annual sales of ziltivekimab in our model by 2035, making it a relatively insignificant driver of our more than USD 50 billion in forecast total sales that year.

Coming up: Novo still expects data from additional cardiovascular outcomes studies of ziltivekimab—Hermes in heart failure and Artemis in acute heart attack—in the first half of 2027. However, we have removed the drug candidate from our revenue forecast, given the failure in Zeus.