Shares of Novo Nordisk (NVO) American depositary receipts (ADRs) and Eli Lilly (LLY) dropped on Tuesday following an op-ed by U.S. President Joe Biden and Senator Bernie Sanders criticizing the companies for high medication costs.
Biden and Sanders targeted the pharmaceutical industry for charging “outrageous prices” for prescription drugs, specifically highlighting Novo Nordisk’s Wegovy and Eli Lilly’s Mounjaro. They described the prices of these popular weight-loss treatments as “unconscionably high.”
Biden and Sanders Demand Price Reductions
In their op-ed, Biden and Sanders urged Novo Nordisk and other pharmaceutical companies to “substantially lower prescription drug prices in our country and end their greed.” They warned of potential action if the companies fail to comply, stating, “we will do everything within our power to end it for them.”
The op-ed specifically called on Novo Nordisk to reduce the prices of Ozempic and Wegovy, noting that Novo Nordisk charges over $1,000 a month for these drugs, while the manufacturing cost is less than $5.
Novo Nordisk responded by expressing disappointment, arguing that the issue is being “oversimplified and mischaracterized for political purposes.” The company added that over 80% of insured Americans pay $25 or less per month for Ozempic and Wegovy. Eli Lilly did not immediately comment on the matter.
Market Impact
Following the publication of the op-ed, Novo Nordisk ADRs fell by 1.7%, closing at $142.98 on Tuesday, while Eli Lilly shares declined by 0.8% to $906.71. Despite these losses, Novo Nordisk ADRs have risen over 38% since the beginning of the year, and Eli Lilly shares have surged more than 55% during the same period.
