Novo Nordisk Projects Challenging 2026 as Pricing Pressures and Market Competition Mount

Novo Nordisk A/S (NYSE:NVO), a major pharmaceutical company renowned for its portfolio of weight-loss treatments, faced notable declines in its stock price following the release of its financial outlook for fiscal year 2026 on Tuesday. The company forecasted a complex year ahead, where operational profit and sales figures balance between an expected one-time reversal tied to U.S. drug pricing reforms and broader market and pricing pressures that could impede organic growth. The firm's guidance incorporates an important adjustment related to the 340B Drug Pricing Program within the United States. Novo Nordisk projects a $4.2 billion benefit from the reversal of provisions associated with this program in 2026, a substantial increase compared to the $400 million excluded from 2025 adjustments. This accounting change contributes a significant financial uplift, influencing the reported sales and operating profit expectations. Removing this one-off impact, the outlook for core performance indicators at constant exchange rates (CER) portrays a challenging picture. The mid-point of sales growth guidance for the year anticipates a contraction of approximately 1%, while operations profit growth is expected to rise by roughly 11%. More specifically, adjusted sales growth for 2026, which excludes revenues stemming from the 340B provisions reversal, is anticipated to decline between 5% and 13% on a CER basis. This lowered expectation reflects a confluence of factors pressuring realized drug prices. Among these are the effects stemming from the “Most Favoured Nations” (MFN) agreement in the U.S., the expiration of the semaglutide patent in select international markets, and intensifying competition within the biopharmaceutical landscape. Novo Nordisk's president and CEO, Mike Doustdar, acknowledged these headwinds in a company statement, emphasizing that the price environment will grow increasingly competitive in 2026. He highlighted that the company is preparing to confront pricing pressures and elevated competition that will influence its financial trajectory. In the U.S., the projections are particularly influenced by current trends in glucagon-like peptide-1 receptor agonist (GLP-1) prescriptions. Forecasts factor in heightened competitive activity, diminished Medicaid coverage for obesity pharmaceuticals, and downward pressure on pricing attributable to expanded market-access initiatives linked to the MFN agreement. These variables collectively contribute to the anticipated softness in revenue growth. Reflecting on the fiscal year 2025, Novo Nordisk reported sales of 309.06 billion Danish kroner (DKK), marking a 10% increase at CER compared to the prior period. Operating profit similarly expanded by 6% to DKK 127.66 billion, surpassing the company's initial guidance range, which had projected 8% to 11% sales growth alongside 4% to 7% operating profit growth. The net profit for 2025 edged slightly higher, reaching DKK 102.43 billion with earnings per share at DKK 23.03. Growth in U.S. sales was notably influenced by gross-to-net sales adjustments, underscoring the complex pricing and reimbursement environment in that market. A notable development early in 2026 was the launch of the Wegovy oral pill on January 5. Early uptake indicates a steady demand trajectory, with total weekly prescriptions tallying approximately 50,000 as of January 23. Adoption of the medication has predominantly revolved around the 1.5 mg starter dose, especially within the self-pay market segment. Despite these promising elements, the market reaction has been brisk. Novo Nordisk's stock price declined by over 14%, settling at $50.62 by Tuesday's close according to data provided by Benzinga Pro. This market movement reflects investor concerns surrounding the nuanced balance of one-time financial boosts against underlying trends of price erosion and competitive challenges. In summary, while Novo Nordisk's 2025 financial outcomes illustrated robust sales gains and profit growth, the company has signaled significant uncertainties and near-term pressures for 2026. The interplay of U.S. drug pricing reforms, patent expirations internationally, and a more crowded competitive field pose tangible risks to revenue expansion and margin stability in the coming year.