Wegovy is produced by pharmaceutical company Novo Nordisk and has been approved for specifically for chronic weight management in adults and adolescents. (Photo by Steve Christo – Corbis/Corbis via Getty Images)
Steve Christo – Corbis | Corbis News | Getty Images
The chief executive of drugmaker Zealand Pharma sought to calm investors about the latest trial results, which showed patients lost less weight than expected and prompted the stock to fall more than 35%.
Speaking to CNBC, CEO Adam Steensberg criticized what he called the “weight loss Olympics,” where markets and companies focus too heavily on the amount of weight lost, rather than on factors such as staying on the medicine long-term and dealing with side effects.
The world doesn’t need these products that amount to very high rates of weight loss, he said, referring to medicines developed by Novo Nordisk and Eli Lilly. The latest trial had also not been optimized for maximum weight loss, he added.
“I need to focus on what the patients need, not what the current market like to see,” Steensberg said. “We have for a long time called to end the weight loss Olympics.”
Zealand is developing the drug petrelintide in partnership with Swiss pharma heavyweight Roche. Mid-stage trial results released after the closing bell on Thursday showed the drug led to an average weight reduction of 10.7% over 42 weeks. Analysts had largely expected between 13% and 20% weight loss.
Shares of Zealand were last seen trading 35% lower, on track for their worst day ever and the lowest close since August 2023. Shares of Roche fell 3%.
Addressing weight maintenance, rather than losing the most amount of weight quickly, has emerged as a way for companies to differentiate themselves as they try to enter the lucrative weight-loss drug market, which has been estimated to be worth as much as $150 billion by 2030.
Steensberg said he was “extremely certain” there would be a shift in the industry “towards tolerability,” referring to how well patients can cope with side effects of the medications.
“I think very, very soon, people start to realize that it’s not about that weight loss number, it’s about how you achieve that weight loss number.”
“If you then look into real world, you will actually discover that most patients who are on treatment today with the current products never get to those numbers that we see in clinical studies,” because “in a real-world setting, people cannot tolerate it,” he said, referring to Novo Nordisk’s and Eli Lilly’s drugs already on the market.
Petrelintide is an amylin analog that targets a hormone produced in the pancreas that affects appetite and slows gastric emptying, rather than the GLP-1 or GIP gut hormones targeted by weight-loss treatments currently on the market, such as Novo’s Wegovy and Lilly’s Zepbound.
A majority of patients on Novo’s Wegovy experience some form of side effects, most commonly gastrointestinal, such as nausea, diarrhea, and vomiting. Most are mild to moderate and transient. The trend is similar for Lilly’s Zepbound.
A Novo spokesperson said that direct comparisons between trials are challenging because of variations in study design and reporting practices. A study of a high-dose semaglutide, the active ingredient in Wegovy and Ozempic, found that patients lost up to 21% of their weight, with only 5.4% ending the treatment due to side effects, the spokesperson said. Only 3.3% discontinued the treatment due to gastrointestinal side effects.
Lilly didn’t respond to a CNBC request for comment.
In the trial results, Zealand said that at the maximum dose of petrelintide, there were “no cases of vomiting and no treatment discontinuations due to gastrointestinal adverse events.” The trial involved 493 people living with overweight and obesity.
It also has a drug under development that combines petrelintide with the Roche-developed CT-388, a GLP-1/GIP receptor, which Zealand says may be a better option for patients needing to lose a large amount of weight.
Real-world potential
One study of more than 125,000 patients suggested that about 50% of people with obesity discontinue appetite-modifying GLP-1 medications within a year. High costs and side effects are common reasons for stopping.
A study published in the British Medical Journal in January found that people who lost weight with the help of GLP-1 drugs, regained weight significantly faster after stopping than those who lost weight with diet and exercise.
Obese patients who stopped GLP-1 medications were projected to return to their starting weight after 1.7 years, the study found, compared with 3.9 years for those who lost weight with behavioral change alone.
The rate at which patients lose weight on drugs has been a key factor driving stock prices for Novo and Lilly in recent years.
Novo shares are trading 75% below their peak in mid-2024, while Lilly shares have risen over the same period as its medicines were shown to deliver a higher rate of weight loss.
On Friday, Jefferies analysts said petrelintide had potential for Wegovy-like efficacy and tolerability on par with placebo which “suggests this is a viable drug.”
But they added it was likely to be viewed as a second-best to the amylin treatment being developed by Lilly.
“For us as a small company, to be among the leading products in a new category… is a very nice place to be,” said Steensberg, adding that it was early to make such calls.
“If you look historically at the markets, if you’re among the three first who launch into a new category with an attractive profile, you will become a very significant player in that category.”
He added that the latest trial hadn’t been optimized to maximize weight loss, as it had an almost 50/50 gender distribution, and that women tend to lose more weight than men.
“Most companies would approach that with 70% females,” he said, adding he was “confident” petrelintide would lead to a weight loss in the mid-teens once they have optimized starting conditions.
The trial results published Thursday were about “finding the doses and then demonstrating the safety and solid ability,” he said.
Zealand said it expected to initiate a Phase 3 study later this year. But Barclays analysts said that the market was unlikely to credit a Phase 3 “fix” for petrelintide in two years.
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2026-03-07 03:56:51
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