Can Medicare Bridge Help Novo Nordisk Defend Its GLP-1 Leadership?

Novo Nordisk NVO has received another commercial boost as the Medicare GLP-1 Bridge program officially went live on July 1, allowing eligible Medicare beneficiaries to access Wegovy (semaglutide injection and pill) for a $50 monthly copay through the end of 2027. The program significantly expands a…

Novo Nordisk NVO has received another commercial boost as the Medicare GLP-1 Bridge program officially went live on July 1, allowing eligible Medicare beneficiaries to access Wegovy (semaglutide injection and pill) for a $50 monthly copay through the end of 2027. The program significantly expands access to FDA-approved GLP-1 obesity medicines for a population that previously had limited reimbursement options. The announcement also reinforces the strong momentum behind NVO’s oral obesity franchise, with the Wegovy pill surpassing three million U.S. prescriptions in early June since its January 2026 launch.

While the expanded access is clearly positive for Novo Nordisk, the broader competitive implications are more nuanced. Eli Lilly's LLY GLP-1 obesity drugs — Zepbound (tirzepatide) injection and Foundayo (orforglipron) pill — are now also available under the same Medicare GLP-1 Bridge program at the identical $50 monthly copay. As a result, Medicare reimbursement is unlikely to become a differentiating factor between the two obesity leaders. Instead, the program largely levels the playing field by removing affordability as a key barrier for eligible Medicare patients, shifting competition back to product characteristics, physician preference and clinical differentiation.

This matters because Lilly has steadily gained share in the obesity market over the past year. Zepbound has outperformed Wegovy injection in head-to-head weight-loss studies, making it an increasingly attractive option for physicians seeking greater efficacy. With Medicare patients now receiving similar reimbursement for both therapies, Novo Nordisk cannot rely on broader insurance access alone to defend market share in injectables. The competitive battle will increasingly hinge on clinical outcomes and long-term real-world experience rather than pricing or reimbursement advantages.

The same dynamic is beginning to emerge in oral obesity therapy. Novo Nordisk enjoyed a first-mover advantage after launching the Wegovy pill earlier this year, helping the product rapidly exceed three million prescriptions. However, Lilly's Foundayo introduces meaningful competition with a simpler administration profile. Unlike the Wegovy pill, which must be taken on an empty stomach under specific dosing instructions, Foundayo can be taken without food or drink restrictions, offering greater day-to-day convenience that could improve patient adherence.

That said, convenience is only one side of the equation. Clinical data suggest the Wegovy pill carries a relatively lower burden of gastrointestinal side effects than Foundayo, which could influence prescribing decisions. As a result, some physicians and patients may prefer the Wegovy pill for its better tolerability, even if Foundayo is more convenient to take.

Overall, the Medicare GLP-1 Bridge program should expand the addressable obesity market by improving affordability for millions of eligible beneficiaries rather than materially favoring one manufacturer over the other. For Novo Nordisk, the expanded access supports continued prescription growth and validates the commercial opportunity for its obesity franchise. However, because Lilly's competing injectable and oral products receive the same reimbursement benefit, the program does little to alter the competitive landscape.

Going forward, NVO’s ability to stabilize and eventually regain obesity market share will depend less on reimbursement expansion and more on differentiating Wegovy through its broader clinical profile. Beyond weight loss, Wegovy remains the only obesity therapy approved to reduce the risk of major adverse cardiovascular events in adults with obesity and established cardiovascular disease, a benefit that continues to strengthen its value proposition as physicians increasingly weigh efficacy, safety and long-term clinical outcomes alongside patient convenience.

Competition Heating Up in the GLP-1 Space for NVO

While Novo Nordisk and Eli Lilly presently dominate the obesity market, smaller biotech firms, like Viking Therapeutics VKTX and Structure Therapeutics GPCR, are also advancing GLP-1–based therapies to challenge the incumbents.

Viking Therapeutics’ dual GIPR/GLP-1 receptor agonist, VK2735, is being developed both as oral and subcutaneous formulations for the treatment of obesity. Viking Therapeutics plans to advance oral VK2735 into phase III development for obesity in the fourth quarter of 2026.

Structure Therapeutics’ phase II ACCESS study on its orally administered GLP-1 RA, aleniglipron, demonstrated significant weight loss across all doses. Structure Therapeutics expects to initiate the late-stage program of aleniglipron in obesity in the second half of 2026.

NVO’s Stock Price, Valuation & Estimates

Year to date, Novo Nordisk shares have lost 0.8% against the industry’s 10.5% growth. The company has also underperformed the sector and the S&P 500 during the same time frame, as seen in the chart below.

NVO Stock Underperforms the Industry, Sector & the S&P 500

Novo Nordisk is trading at a discount to the industry, as seen in the chart below. Going by the price/earnings ratio, the company’s shares currently trade at 14.80 forward earnings, which is lower than 18.57 for the industry. The stock is trading much below its five-year mean of 29.25.

NVO Stock’s Valuation

Earnings estimates for 2026 have improved from $3.34 to $3.38 per share over the past 60 days. During the same time frame, Novo Nordisk’s 2027 earnings estimates have decreased from $3.36 to $3.33 per share.

NVO’s Estimate Movement

Novo Nordisk currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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