Investing.com — Analysts at Barclays are bullish on Novo Nordisk (NYSE ) shares ahead of the December release of fundamental data from clinical trials for its next-generation obesity treatment, CagriSema.
The results of the REDEFINE-1 Phase 3 trial could, according to Barclays (LON:), “redefining the obesity landscape” and providing a much-needed boost to the company's shares, which have faced a turbulent second half of 2024.
They explained that CagriSema combines two active ingredients: cagrilintide, an amylin receptor analog, and semaglutide, a GLP-1 receptor analog. This double mechanism of action aims to create a synergistic effect on weight loss.
Novo Nordisk has set a minimum weight loss target of 25% in the trial, which would make CagriSema the most effective weight loss drug commercially available.
Barclays is optimistic, saying: “We believe Novo will hit this 25% weight loss bar.”
The Danish pharmaceutical giant's shares have fallen 27% since June, lagging 24% behind the European pharmaceutical index (SXDP).
Factors contributing to this decline include “slight misstatements” in Q2 and Q3 results, concerns about Wegovy's prescription growth in the US, and a broader sector rotation following the US presidential election. .
Despite these challenges, Barclays remains confident in Novo Nordisk's long-term growth prospects and emphasizes that success with CagriSema could reverse the recent share price decline.
Barclays projects a potential 14% increase in its current net present value estimates for Novo Nordisk if the trial achieves its weight loss goal, even taking into account expected gastrointestinal side effects.
The analysts conclude: “We reiterate our Overweight rating on this critically important catalyst.”
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