Shares of weight-loss drug makers Novo Nordisk and Eli Lilly fell on Friday after US President Donald Trump said that the price of Novo's popular Ozempic treatment would be lowered.
Although Ozempic is approved to treat diabetes, it shares the same active ingredient - semaglutide - as the Danish drugmaker's blockbuster obesity treatment Wegovy.
In the United States, Ozempic has been frequently used as a so-called off-label treatment for obesity and often served as a generic reference to weight-loss drugs.
Since taking office in January, Trump has been striving to narrow the gap between US and foreign drug prices. Under its "most favored nation" policy, the US government will require drugmakers to charge patients in the US no more than in other wealthy nations.
Novo's shares fell to a near three-week low of 342.3 crowns and were last down six per cent at 344.7 crowns. Shares in rivals dropped as well, with Eli Lilly down four per cent and Zealand Pharma five per cent.
In US pre-market trading, Viking Therapeutics was down nearly six per cent, and Altimmune one per cent.
BMO Capital markets analyst Evan Seigerman said that the market reaction to Trump's comments seemed exaggerated.
Trump's made the comments during a White House event on Thursday, where he announced a deal with Germany's Merck to cut the cost of some drugs needed for in-vitro fertilisation in exchange for protection from future tariffs.
Trump was asked by reporters to identify the drug that he said earlier at the event would be made less expensive.
"I was referring to Ozempic, or - I was referring to - the fat loss drug?.... They'll be much lower," Trump said.
A Novo spokesperson said the company was in discussions with the Trump administration over the most favored nation order.
UBS analysts said they had already factored potential US price cuts into their forecasts.
"If the prices mentioned by President Trump end up being the negotiated prices then this would be more than captured by our numbers," they wrote.
JP Morgan analysts also said investors were prepared for price cuts for semaglutide, which is among the list of 15 drugs selected for a US price negotiation programme.
Mehmet Oz, who runs the Centers for Medicare and Medicaid Services and was at the event on Thursday, said that the agency had not yet finished negotiating the price for the GLP-1 class of drugs, which includes Ozempic, Wegovy, and Lilly's Mounjaro.
