Novo Nordisk is still worried about revenue growth next year despite obesity pill: BMO's Seigerman

? (Correspondent) 00:00.230

evan segerman is head of healthcare research at bmo he's only got a market perform on novo he says this is a big win but sees a challenged road ahead he's here on set with us first of

Evan Seigerman (Head of Healthcare Research) 00:08.630

all welcome thank you for having me it's great to be here despite the weather

? (Correspondent) 00:11.790

yes and as you say despite this having been a hotel hold on for dear life year for healthcare broadly but a nice finish no i mean go back to the summer when you had the health insurers you know collapsing and all that stuff going on just kind of give us a landscape coming into

? (Correspondent) 00:27.640

this novo announcement of what you think is happening with the space for

Evan Seigerman (Head of Healthcare Research) 00:31.150

sure so just a bit overview on the year kind of weird optimism into the trump presidency than we had liberation day everything fell off of a cliff turmoil at FDA and then in the past six months like the back half of the year has been one of the best segments for biopharm i think

Evan Seigerman (Head of Healthcare Research) 00:46.630

in a decade

? (Correspondent) 00:47.270

are you serious i think it's in

Evan Seigerman (Head of Healthcare Research) 00:48.350

terms of returns yeah i think it's the best we looked at it i think it's the best in a decade so wow strength there people are kind of getting back into the sector because

? (Correspondent) 00:56.710

we were told that vaccine uncertainty was going to be no drug you know it was going to hurt the development pipeline or just approval uncertainty written large

Evan Seigerman (Head of Healthcare Research) 01:03.870

but you look at these names and a lot of them are up people feel optimistic but going back to novo so obviously we're in the obesity war with lillian nova i have an outperform on lily i think i called it the goat of obesity last year on this program or CNBC and you know i

Evan Seigerman (Head of Healthcare Research) 01:20.870

downgraded novo shares back in april because they just had lost their way so they are making good progress does this change

? (Correspondent) 01:27.550

your mind because the CEO told our reporter annika earlier today that and i think the market has said this as well that this one performs better it's superior it's a better product

Evan Seigerman (Head of Healthcare Research) 01:36.030

i it is important to the story but if you talk to nova they're worried about kind of revenue growth next year i think when you compare the wegovy pill as it's now called to lilies or for glyphron you have more weight loss with the wegovy pill it needs a lot of API it's like

Evan Seigerman (Head of Healthcare Research) 01:51.390

twenty five

? (Correspondent) 01:52.270

it's API API great

Evan Seigerman (Head of Healthcare Research) 01:53.110

question it's the active drug and the pill i

? (Correspondent) 01:55.030

see

Evan Seigerman (Head of Healthcare Research) 01:55.350

so it's like twenty five milligrams and the high dose of the shot is two point four milligrams so

? (Correspondent) 02:00.750

it's

Evan Seigerman (Head of Healthcare Research) 02:01.150

seventy times more when it comes to lilly i like orthoglipron you don't have what's called the food effect that's a big deal so when you take the wegovy pill you have to take it first thing in the morning and wait a half hour before you can do that you do that every day the

Evan Seigerman (Head of Healthcare Research) 02:14.510

orthoglipron lilies pill doesn't have that doesn't have that issue regardless the the

? (Correspondent) 02:19.590

fact that the that this new pill is so highly concentrated as you described do you think that presents side effect risks

Evan Seigerman (Head of Healthcare Research) 02:25.910

i mean there's always side effect risk with GLP ones but i think that it's pretty well known if you trade off and i think when it comes to you know novo they are making progress right i'm not i'm not hating on the stock i see some issues i there's a clear valuation disconnect

Evan Seigerman (Head of Healthcare Research) 02:41.590

and folks constantly ask me do i get in now i want to see them make more fundamental progress when it comes to kind of revamping their strategy

? (Correspondent) 02:51.070

before you get to the zero point two four versus the two point four versus the twenty five there's a bigger difference the shot versus the pill sure how big a deal do you think that will be for average americans how many people don't want to do the drug because it means a shot

? (Correspondent) 03:05.950

versus are happy and they're happy taking a pill and so if you

Evan Seigerman (Head of Healthcare Research) 03:08.430

ask me two years ago i would say no one wants a shot now the needles like this big i don't think most people care it's amazing and they like the convenience it's once a week they do it on a sunday then they forget about it so there is definitely a subset of patients who don't

Evan Seigerman (Head of Healthcare Research) 03:24.830

want a shot needle phobic get sick of it but you talk to a lot of folks who are on wegovy or zeppelin and they don't mind it

? (Correspondent) 03:32.150

where are we on the curve of the adoption of this drug how much has happened and how much more is there to go and how much of what there is to go is already priced in

Evan Seigerman (Head of Healthcare Research) 03:42.790

oh that's a lot of questions there so

? (Correspondent) 03:44.310

the last one 's the most important part exactly

Evan Seigerman (Head of Healthcare Research) 03:46.350

i think when it comes to lilly there's a lot priced in this huge hundred billion dollar plus market in terms of where we are i mean there's probably five six million patients who are on a GLP one for obesity in the united states we look at script data and how many

? (Correspondent) 04:01.550

hundred and forty million are obese or something like

Evan Seigerman (Head of Healthcare Research) 04:04.230

that so we're not that we're not that deeply penetrated so there is still room and that's why you know there's still room for novo to win for lily to win and i think what's going to be very interesting is what happens when you have longer acting other players like pfizer coming

Evan Seigerman (Head of Healthcare Research) 04:19.790

into the market so there's still penetration and then