Novo Nordisk investors may have reason for hope after finding little cause for optimism during a bruising two-year period of profit warnings, leadership upheaval and a sliding share price as rival Eli Lilly streaked ahead.

Despite having lost ground in injectable GLP-1s in recent years, the Danish obesity drugmaker is now getting a significant boost from its new Wegovy weight-loss pill. The drug is holding its lead against Eli Lilly's more recently launched Foundayo.

The two pharmaceutical giants are locked in a fierce battle for dominance in the burgeoning obesity drug market, which analysts project will exceed $100 billion in the United States alone by the end of the decade.

Novo's shares have climbed some 35% from a March low, indicating a renewed offensive from the company. This includes a divisive court case against Lilly, alleging misleading marketing in the vital U.S. market.

Morten Gregersen, chief portfolio manager at Danish asset manager Formuepleje and a Novo shareholder, commented on the transformation: "Novo is a different Novo today than a year ago.

“They're much more consumer-oriented and they've become much more aggressive."

NOVO VS LILLY: A COMEBACK STORY?

Analysts and shareholders will look for clues from management that Novo's turnaround is durable when the company reports second-quarter results on August 5, and that it can keep pace with Lilly over the longer term.

The U.S. drugmaker reports results on the same day, and analysts broadly expect robust sales of its blockbuster weight-loss and diabetes injections, Mounjaro and Zepbound.

Recent IQVIA prescription data suggests demand for oral Wegovy remains stronger than analysts initially expected and well above Lilly's Foundayo, although Barclays noted the figures understate total Foundayo demand because they exclude certain distribution channels.

"One of the concerns had been that orforglipron from Lilly was going to come along and make things a lot tougher for oral Wegovy," said Barclays analyst James Gordon, using the generic name for Foundayo. "But so far... orforglipron doesn't really seem to have impacted the product."

ARE WE AT AN INFLECTION POINT?

Novo spent 2025 on the defensive as mounting U.S. pricing pressure and competition led to four guidance cuts and wiped billions from its market value. The company replaced its CEO and launched a restructuring that cut 9,000 jobs.

This year, Novo has regained some momentum with oral Wegovy, which it launched in the U.S. in January, firing hopes that the worst may be behind it.

The pill, however, has yet to alter the broader picture. After overtaking Wegovy injections last year, Lilly's Zepbound has maintained a commanding lead in the U.S. market, with weekly prescriptions more than double those of Novo's drug in recent months. Novo's ability to broaden beyond obesity and diabetes is also under scrutiny after a recent heart disease drug trial fail.

"The real question is...when is the inflection point? Which particular quarter looks like a trough, and then do we see growth back from that point?" said HSBC analyst Rajesh Kumar.

He said expectations for 2026 had improved, though that partly reflected generic competition for Wegovy arriving later than previously expected, pushing some of the pressure into 2027 rather than eliminating it.

NOVO NORDISK LOOKS TO 'MAKE SOME NOISE'

Novo and Lilly's rivalry has spilled into the courts. Last month, Novo sued Lilly in a U.S. federal court, accusing it of false advertising for using comparisons of efficacy that omit its newer, higher-dose Wegovy. Lilly has denied the allegations.

BMO analyst Evan Seigerman said that Novo was being more "aggressive" and trying to "make some noise", even if the suit was unlikely to make a huge difference.

"It's kind of like using a lawsuit as a bit of publicity to shift opinions," he said.

Others like Sven Borho, managing partner at Orbimed, said that the suit would struggle to change the perception in the U.S. that Zepbound was superior to Wegovy. Instead, he said Novo needed to strike deals in the obesity space to persuade the market that they can compete with Lilly long term.

Analysts said Novo could edge up its full-year outlook, though the main positive may be a lack of crisis and drama.

"Even if there is no guidance raise, it will be comforting to know that the company has left the era of profit warnings," said Markus Manns, portfolio manager at Union Investment.