Novo Nordisk downgraded by leading banks as CagriSema trial flops against Zepbound

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two major banks walking away from bullish positionsNovo Nordisk's (NYSE:NVO) last best hope for life after semaglutide has stumbled badly. The Danish drugmaker's CagriSema combination jab failed on Monday to demonstrate non-inferior weight loss against Eli Lilly's Zepbound in the REDEFINE-4 phase III trial, a result that has prompted two high-profile analyst downgrades and forced a broad reassessment of the company's long-term earnings power.Deutsche Bank, which has backed the stock since initiating at 'buy' in 2021, said the miss "disproves our optimism CagriSema could do much better and blows a sizeable hole in that thesis."He cut his rating to 'hold' and slashed his price target 31%, from DKK400 to DKK275, based on 14x forward earnings.JPMorgan also moved to 'neutral', setting a new price target of DKK250, as both banks concluded that the drug's commercial potential has been materially and perhaps permanently impaired.The REDEFINE-4 result was not a close call by conventional standards. Novo ran the trial for 84 weeks, longer than the 68-72 week duration used in most incretin pivotal studies, an extension widely read as an attempt to give CagriSema every possible advantage against Zepbound. It was not enough.Citi analysts pointed to the trial's additional complexity as a further problem. CagriSema requires a dual-chamber delivery device that is more difficult to manufacture than Zepbound's single-molecule formulation. With inferior weight loss data and a harder-to-produce product, Citi said the drug is "less likely to compete effectively" in a market already dominated by Lilly.JPMorgan's team went further, noting that the readout was poor not just in obesity but also in blood glucose control. Two diabetes-focused studies, REIMAGINE 2 and 3, showed a "more limited effect" than Lilly's rival, reducing CagriSema's appeal across both of its intended therapeutic indications.The stakes here go beyond any single drug. Semaglutide, the active ingredient in Wegovy and Ozempic, loses patent exclusivity at the end of 2031. 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