Novo Nordisk layoffs: 9,000 jobs cut as weight-loss drug competition with Eli Lilly heats up

Novo Nordisk, the Danish pharmaceutical giant behind the popular weight-loss drugs Ozempic and Wegovy, just announced plans to cut 11% of its workforce as competitors like Eli Lilly continue to encroach on its market share.

On September 10, Novo Nordisk shared in a press release that it intends to nix 9,000 positions out of its global workforce of 78,400. The company cited a more competitive obesity market, as well as a “recent slowdown in growth,” as two of the main reasons driving the move to reduce “organisational complexity and costs.”

“As the global leader in obesity and diabetes, Novo Nordisk delivers life-changing products for patients worldwide,” Mike Doustdar, Novo Nordisk president and CEO, said in the release. “But our markets are evolving, particularly in obesity, as it has become more competitive and consumer-driven. Our company must evolve as well.”

In the wake of the announcement, Novo Nordisk’s share price has held relatively steady. However, the company has been losing steam more broadly over the past few months: Since this time last year, its stock has declined by 58%.

Novo Nordisk is facing increased competition on several fronts, including from providers offering compounded versions of its drugs (which it’s actively fighting in court) and from fellow pharmaceutical giant Eli Lilly, Novo Nordisk’s main rival and purveyor of the weight loss medications Zepbound and Mounjaro.

Novo Nordisk faces heightened competition

For Novo Nordisk’s business, a top concern at the moment is the ongoing prevalence of other companies offering compounded—or non-FDA approved—versions of its brand name drugs using the active ingredient semaglutide.

Back in 2022, the Food and Drug Administration (FDA) declared a shortage of GLP-1 medications including Ozempic and Wegovy, which permitted compounded versions of the medication under federal law. But after that shortage notice was officially lifted back in May, Novo Nordisk says the compounded versions of Ozempic and Wegovy are still being produced and sold.

In June, Novo Nordisk cut ties with the telehealth company Hims & Hers Health after accusing Hims of selling alleged “knock-off” weight-loss drugs, and the pharmaceutical company is actively in court with dozens of other U.S. companies that it says is similarly duping its drugs. In July, Novo Nordisk also cut its full-year 2025 guidance, which it attributed in part to compounded drug sales.

“For Wegovy in the US, the sales outlook reflects the persistent use of compounded GLP-1s, slower-than-expected market expansion and competition,” the company said at the time. It added that, as far as Ozempic was concerned, “the updated outlook is negatively impacted by competition in the U.S.”

Aside from companies selling compounded drugs, Novo Nordisk is also facing increasingly tough competition from Eli Lilly and its two popular FDA-approved weight-loss drugs. Eli Lilly’s second quarter earnings report, released in early August, showed that sales of Mounjaro had reached nearly $5.2 billion in revenue, up 68% from the same quarter last year, while sales of Zepbound had reached $3.4 billion, up 172% year-over-year. Given these wins, Eli Lilly increased its full-year guidance. Around the same time, Novo Nordisk released a second quarter report that reflected its lowered growth expectations.

It appears that Novo Nordisk’s layoffs are part of a push to meet these challenges head-on. Per the press release, the workforce cuts are expected to deliver total annualized savings of around $1.25 billion by the end of the year—savings that will be redirected to “growth opportunities in diabetes and obesity.” Doustdar added that the job cuts are part of a necessary shift in the company’s mindset, “so we can be faster and more agile.”