New CEO Maziar Mike Doustdar takes over after US$70 billion selloff and investor doubts over US leadership
Novo Nordisk lost US$70bn in market value in a single day after slashing its 2025 growth forecast and announcing a leadership shake-up, as the drugmaker struggles to maintain its footing in the US weight-loss drug market.
According to Reuters, the company’s new CEO, Maziar Mike Doustdar, will step in on August 7 to lead a turnaround, after the abrupt removal of Lars Fruergaard Jorgensen in May.
Doustdar, who joined Novo in 1992, has no operational experience in the US — a point that has fuelled investor scepticism, given that Wegovy’s losses have been most severe in that market.
Doustdar acknowledged on a call with analysts that his mandate was now clear. “We need to increase the sense of urgency and execute differently,” he said. “The fact that my announcement comes right after the guidance update, just makes the mandate ahead even more clear.”
He added that while the share price drop was difficult to accept, “setbacks don’t define companies. Our response does.”
Reported by Bloomberg, Novo cut its 2025 sales outlook to between 8 percent and 14 percent, down from the previously expected range of 13 percent to 21 percent.
Operating profit projections were similarly revised down to 10 percent to 16 percent, from as high as 24 percent.
The forecast downgrade triggered a 30 percent plunge in Novo shares at one point, before recovering slightly to a 20 percent drop.
As per Reuters, investors expressed disappointment at the appointment of another internal candidate.
“People had hoped for an external candidate,” said Markus Manns, a portfolio manager at Union Investment, one of Novo’s shareholders. “The magnitude of the guidance cut is a shocker.”
Barclays analyst Emily Field also noted that “people are not happy” with the CEO pick, adding, “My understanding is that he has never had US operational experience, and the US is all that matters.”
Doustdar most recently served as head of international operations and previously oversaw business in the Middle East and Southeast Asia.
Board chair Helge Lund defended the decision, saying Doustdar’s familiarity with the company’s strengths and weaknesses would allow him to act faster than an external hire.
“He can respond and take actions on those… quicker than anyone could do coming from the outside,” Lund said.
The company is contending with significant US market losses.
Novo launched Wegovy nearly two and a half years before Eli Lilly’s rival drug Zepbound, yet prescriptions for Zepbound surpassed Wegovy’s this year by over 100,000 per week, as reported by Reuters.
Meanwhile, compounded copycats of Wegovy and Ozempic continue to cut into Novo’s share, despite a US FDA ban on compounded Wegovy copies taking effect on May 22.
According to Chief Financial Officer Karsten Munk Knudsen, “our latest market research indicates” that many US patients have not switched to branded treatments as expected.
“One million or more US patients are still using compounded GLP-1s,” he said.
Novo has been in discussions with the FDA to limit unlawful compounding.
“Compounding continues to be an issue that we have to address,” said US operations head David Moore.
Novo has said a new contract with CVS Health Corp. would help increase Wegovy volume from July 1.
However, as reported by Bloomberg, slower-than-expected market growth, continued compounded drug use, and competition from Lilly have all contributed to the revised guidance.
Analysts from Jefferies and Mizuho Securities said the company’s obesity drug expectations had ballooned too far and were now being reset amid a broader loss of investor confidence.
Doustdar said he plans to build on Novo’s “core strength” while combining “strategic clarity with operational urgency.” He identified advancing the drug pipeline and investing to deliver growth as top priorities.
Though Novo reported second-quarter sales growth of 18 percent and operating profit up 40 percent in constant currencies, the company’s market value has dropped from a peak of US$615bn in June to around US$240bn, reported Bloomberg.
Full quarterly results are expected on August 6.
