Denmark’s Novo Nordisk, maker of the Ozempic and Wegovy weight loss medications, said on Friday its CEO Lars Fruergaard Jorgensen will step down amid concerns the company is losing its advantage in the competitive obesity drug market.
The move follows a 50% decline in the company’s share price over the past 12 months that has reduced its stock market value by about $300 billion.
Novo Nordisk became a world leader in the weight-loss drug market, with sales of its Wegovy and and Ozempic treatments boosting its share price as it became Europe’s most valuable listed company.
However, its shares have fallen since hitting a record high in June 2024 as competition, particularly from US rival Eli Lilly, makes inroads into its market share.
“As per mutual agreement with the Novo Nordisk Board, Lars Fruergaard Jørgensen will step down from his role as CEO of Novo Nordisk,” said the company.
“He will continue as CEO for a period to support a smooth transition to new leadership. A search for Lars Fruergaard Jørgensen’s successor is ongoing, and an announcement will be made in due course.
“In connection with the change, Lars Rebien Sørensen, chair of the Novo Nordisk Foundation, will join the Novo Nordisk Board, initially as an observer.
“Novo Nordisk has been through a significant growth journey and transformation led by Lars Fruergaard Jørgensen. During his eight-year tenure as CEO, Novo Nordisk’s sales, profits and share price have almost tripled.
“Novo Nordisk has a clear strategy, a strong product portfolio and an experienced leadership team. The changes are, however, made in light of the recent market challenges Novo Nordisk has been facing, and the development of the company’s share price since mid-2024.
“In light of this, the Novo Nordisk Foundation Board initiated a dialogue with the Novo Nordisk Board on the merits of an accelerated CEO succession and expressed a wish to increase its representation on the Novo Nordisk Board.
“Through its investment company, Novo Holdings A/S, the Novo Nordisk Foundation controls the majority of votes at the Novo Nordisk Annual General Meeting.
“Considering the recent market challenges, the share price decline, and the wish from the Novo Nordisk Foundation, the Novo Nordisk Board and Lars Fruergaard Jørgensen have jointly concluded that initiating a CEO succession is in the best interest of the company and its shareholders.
“Lars Fruergaard Jørgensen has agreed to continue as CEO for a period to support a smooth transition to new leadership.
“Furthermore, the Novo Nordisk Board has agreed with the Novo Nordisk Foundation Board that Lars Rebien Sørensen, chair of the Novo Nordisk Foundation, will participate as an observer in Novo Nordisk’s Board meetings as of today, with the intention of being nominated for election as a board member at the Annual General Meeting in 2026.”
Helge Lund, chair of the Novo Nordisk Board, said: “Novo Nordisk’s strategy remains unchanged, and the Board is confident in the company’s current business plans and its ability to execute on the plans.
“On behalf of the Board, I would like to thank Lars Fruergaard Jørgensen for his outstanding contributions to Novo Nordisk’s success during his tenure as CEO. He is highly respected both inside and outside the company for his leadership, values and vision for the company and the pharmaceutical industry at large.”
Jørgensen, 58, joined Novo Nordisk in 1991 and was appointed chief executive officer in January 2017.
Jørgensen said: “Serving as Novo Nordisk’s CEO for the past eight years has been a privilege and an experience that I will always cherish. I am proud of the results I have helped create together with my leadership team, the Board, and the thousands of employees who work every day to drive change to defeat serious chronic diseases.”