Analysis of Novo Nordisk and Eli Lilly's GLP-1 Drug Pricing Strategy and Ability to Resist Domestic Substitution

Based on the obtained materials and data, I will conduct an in-depth analysis of Novo Nordisk and Eli Lilly’s GLP-1 drug pricing strategies and their ability to resist the wave of domestic substitute drugs from multiple dimensions including strategy, market, and competition.

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and are absolute leaders in the GLP-1 drug market:

• Novo Nordisk
  : Semaglutide (Chinese brand names: Nuohuitai®/Ozempic for hypoglycemia, Nuohuying®/Wegovy for weight loss). Its global sales continued to grow in the first three quarters of 2025, accounting for approximately
  80% of China’s GLP-1 market share
  [2]
• Eli Lilly
  : Tirzepatide (trade names: Mounjaro for hypoglycemia, Zepbound for weight loss). Its global sales reached
  USD 24.837 billion
  in the first three quarters of 2025, a year-on-year increase of 125%, successfully becoming the world’s “top-selling drug” [6]

(based on API data) [0]:

Indicator	Novo Nordisk (NVO)	Eli Lilly (LLY)
Market Cap	USD 232.9 billion	USD 968.1 billion
Current Stock Price	USD 52.40	USD 1,077.75
YTD Performance	-40.13%	+38.52%
P/E Ratio	13.27x	52.50x
Net Profit Margin	35.61%	30.99%
Operating Profit Margin	45.78%	43.86%

: Although Eli Lilly’s market cap is much higher than Novo Nordisk’s, Novo Nordisk’s stock price fell by more than 40% in 2025, while Eli Lilly’s rose by nearly 40%, reflecting the market’s different expectations for the future prospects of the two companies.

[2][5], marking the end of the patent protection period and allowing generic drugs to be legally marketed. This is the biggest threat facing Novo Nordisk:

• Domestic biosimilar applications for semaglutide accepted
  : Over 10 enterprises, including China National Biotec Group, CSPC Pharmaceutical Group, Fosun Pharma, Betta Pharmaceuticals, Huadong Medicine, Federal Pharmaceutical, Livzon Group, Qilu Pharmaceutical, etc. [2]
• Semaglutide biosimilar projects entering clinical stages
  : Over 20 [2]
• Indian market
  : Over 20 pharmaceutical manufacturers plan to launch generic drugs after March 2026, with prices expected to be about 60% cheaper [5]

: The patent protection period of tirzepatide will last at least until the mid-2030s [5], providing Eli Lilly with a longer time window than Novo Nordisk.

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According to the latest data, tirzepatide saw a significant price reduction at the end of 2025 [6]:

• 2.5mg starting dose
  : Monthly cost reduced from USD 349 to USD 299 (approximately RMB 2,106)
• 5mg small bottle
  : Reduced from USD 499 to USD 399
• 7.5mg,10mg,12.5mg,15mg doses
  : Reduced from USD499 to USD449
• E-commerce platform prices
  : Monthly cost for 2.5mg×4 doses ranges from RMB450-600, a reduction of 60-70% compared to before national negotiation

• Hypoglycemic version Nuohuitai® (1.34mg/ml×1.5ml)
  : Lowest transaction price dropped to RMB329 per vial
• Weight loss version Nuohuying® (1ml:1.34mg×1.5ml)
  : Lowest selling price is RMB388 per vial
• Significant drop compared to previous mainstream market prices

• Eli Lilly provides discounts to self-paying patients via LillyDirect direct sales platform
• Novo Nordisk also lowered GLP-1 drug prices in the U.S.
• Both companies reached agreements with the U.S. government to offer discounted prices through the TrumpRx platform (not yet launched) [1]

###2.2 Strategic Motivations for Price Reduction

: This is not a simple year-end promotion, but precise strategic preemption [2]:

1. Defensive pricing before patent expiration
   : Lock in patient groups and establish price anchors before semaglutide’s patent expires in March 2026
2. Seize medical insurance access dividend
   : Tirzepatide successfully entered China’s national medical insurance catalog at the end of 2025; price reduction is to cooperate with medical insurance implementation [6]
3. Channel sinking and market expansion
   : Penetrate from high-end markets to middle-class and small-town markets
4. Build brand moat
   : Increase patient stickiness by occupying the market in advance, reducing the possibility of switching to generic drugs in the future

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##3. Domestic Substitution Wave: Key Node in 2026

###3.1 Domestic Innovative Drugs Approved or Soon to Be Approved

• Approval time
  : Approved for weight loss indication in June 2025, and for type 2 diabetes indication in September 2025 [2][4]
• Innovation
  : The world’s first approved GCG/GLP-1 dual receptor agonist
• Efficacy data
  : Average weight loss of
  18.6%
  in 48 weeks, significantly reducing liver fat content by
  80%
• Pricing
  : E-commerce price for 2mg×4 doses is
  RMB1,030
  [4]
• Differentiated advantage
  : Specifically targets patients with fatty liver and other metabolic abnormalities, bringing comprehensive metabolic benefits

• Application status
  : NDA for weight loss indication accepted on September 1,2025;
  expected to be approved in 2026
  [2]
• Innovation
  : GLP-1/GIP dual-target agonist
• Efficacy data
  : In phase III weight loss clinical trials, the 6mg group achieved a maximum average weight reduction of
  19.2%
  in 48 weeks; phase II clinical trials for type 2 diabetes showed a maximum HbA1c reduction of
  2.7%
• Market expectation
  : Regarded as one of the two core forces most likely to challenge the original research pattern

###3.2 Semaglutide Biosimilars: Concentrated Launch in 2026

According to industry forecasts,

[2]:

:

• CDE-accepted marketing applications (10 companies)
  : China National Biotec Group, CSPC Pharmaceutical Group, Fosun Pharma, Betta Pharmaceuticals, Huadong Medicine, Federal Pharmaceutical, Livzon Group, Qilu Pharmaceutical, etc.
• Projects entering phase III clinical trials
  : Over 10 products including Zhitai Biologics, China Resources Double Crane, Hanyu Pharmaceutical, etc.

:

• Industry consensus: Domestic biosimilars are likely to be priced at
  70-80%
  of original research products, rather than无序下探
• The mainstream price of weight loss drugs will remain above
  RMB200
  in 1-2 years; whether it drops to the hundred-yuan range depends on competition in three years

###3.3 Differentiated Competition Strategies of Domestic Enterprises

: Core variable is [2]

• If GLP-1 drugs from CSPC and Hengrui are approved in 2026, they will directly compete with Nuohuying®

: Key lies in

• Beyond weight loss and diabetes, the potential of GLP-1 in NASH, Alzheimer’s disease and other fields has been initially verified

: Tests

• Improve user stickiness through combined medication, digital patient management and other models

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##4. Evaluation of Pricing Strategy Effectiveness

###4.1 Advantages of Price Reduction Strategy

• Occupy market mindshare in advance
  : Establish price anchors before generic drugs are launched, so that patients form the perception of “original research drug = reasonable price”
• Increase patient stickiness
  : Reduce the willingness to switch to generic drugs later through early medication (patients have dependence on drugs with established efficacy)

####

• Mature sales network
  : Novo Nordisk occupies 80% of China’s GLP-1 market share and has a strong hospital and retail channel network
• Brand trust
  : Brand trust of original research drugs among doctors and patients is difficult to replace in the short term
• Medical insurance access advantage
  : After entering medical insurance, tirzepatide will become an important choice for hospital prescriptions

####

• Production cost advantage
  : Large-scale production brings lower unit costs; high profit margins can still be maintained after price reduction
• Continuous R&D investment
  : The two companies’ R&D investment in GLP-1 far exceeds domestic enterprises; next-generation products (such as oral preparations, triple-target agonists) have been laid out

###4.2 Limitations of Price Reduction Strategy

####

• Semaglutide patent expiration in March 2026
  is a certainty; generic drug launch is inevitable
• Price advantage of biosimilars
  : Although domestic biosimilars are expected to be priced at 70-80% of original research, their absolute price may still be lower than the reduced original research drugs
• Indian generic drug threat
  : Indian generic drugs with about 60% cheaper prices may form competitive pressure in emerging markets [5]

####

• Innovent Biologics’ Mazdutide
  : As the world’s first GCG/GLP-1 dual-target drug, it has differentiated advantages in efficacy (especially for fatty liver patients)
• Hengrui Medicine’s HRS9531
  : Weight loss effect reaches 19.2%, showing “best-in-class” potential in non-head-to-head comparisons
• Pricing flexibility of domestic enterprises
  : Can adjust prices more flexibly to adapt to market changes

####

• Novo Nordisk’s oral semaglutide
  : Approved by FDA in December 2025 and launched in January 2026, with an average weight loss of 16.6% in 64 weeks [2]
• Significance of oral preparations
  : With price and convenience advantages, it may attract more mild-to-moderate obese patients who are concerned about injections
• Domestic enterprises’ catch-up in oral field
  : Hengrui Medicine’s HRS-7535 has started phase III clinical trials, and key data is expected to be disclosed in 2026 [2]

####

• China’s GLP-1 market penetration is only 1%
  , while the U.S. is as high as 10% [6]
• Broad market space
  : It has not yet entered the stock game stage of mutual growth and decline; enterprises can still expand the “cake” together

###4.2 Limitations of Price Reduction Strategy

####

• Semaglutide patent expiration in March 2026
  is a certainty; generic drug launch is inevitable
• Price advantage of biosimilars
  : Although domestic biosimilars are expected to be priced at
  70-80%
  of original research, their absolute price may still be lower than the reduced original research drugs
• Indian generic drug threat
  : Indian generic drugs with about
  60%
  cheaper prices may form competitive pressure in emerging markets [5]

####

• Innovent Biologics’ Mazdutide
  : As the world’s first GCG/GLP-1 dual-target drug, it has differentiated advantages in efficacy (especially for fatty liver patients)
• Hengrui Medicine’s HRS9531
  : Weight loss effect reaches
  19.2%
  , showing “best-in-class” potential in non-head-to-head comparisons
• Pricing flexibility of domestic enterprises
  : Can adjust prices more flexibly to adapt to market changes

####

• Novo Nordisk’s oral semaglutide
  : Approved by FDA in December 2025 and launched in January 2026, with an average weight loss of
  16.6%
  in 64 weeks [2]
• Significance of oral preparations
  : With price and convenience advantages, it may attract more mild-to-moderate obese patients who are concerned about injections
• Domestic enterprises’ catch-up in oral field
  : Hengrui Medicine’s HRS-7535 has started phase III clinical trials, and key data is expected to be disclosed in 2026 [2]

####

• China’s GLP-1 market penetration is only 1%
  , while the U.S. is as high as
  10%
  [6]
• Broad market space
  : It has not yet entered the stock game stage of mutual growth and decline; enterprises can still expand the “cake” together

###4.3 Comprehensive Evaluation: Can Price Reduction Strategy Resist Domestic Substitution Wave?

####

• ✅ Price reduction combined with medical insurance access can quickly seize market share and delay generic drug impact before their launch
• ✅ Brand trust and mature sales network are the moats of original research drugs
• ✅ Eli Lilly’s tirzepatide has a longer patent protection period and is expected to continue growing in the hypoglycemic and weight loss market

####

• ⚠️ After semaglutide biosimilars are launched, price-sensitive patients will switch to biosimilars
• ⚠️ Domestic innovative drugs (Mazdutide, HRS9531) have differentiated advantages in efficacy and may break through in segmented markets
• ⚠️ Oral preparations may change the market competition pattern, especially for patients concerned about injections

####

• 🔄 Simple price wars are difficult to maintain long-term advantages
• 🔄
  Next-generation products
  (triple-target agonists, oral preparations, combined therapies) will become the focus of competition
• 🔄
  Indication expansion
  (NASH, cardiovascular diseases, Alzheimer’s disease) will open new growth curves

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##5. Key Variables and Risk Factors

###5.1 Key Variables Affecting Price Reduction Strategy Effectiveness

Variable	Advantage of Original Research Drugs	Advantage of Domestic Substitute Drugs
Efficacy	Sufficient long-term safety and efficacy data	Some innovative drugs have better weight loss effects (e.g., Mazdutide 18.6%, HRS9531 19.2%)
Price	Still higher than expected generic drug prices after reduction	Biosimilars are expected to be priced at 70-80% of original research, with price advantages
Channel	Mature hospital and retail network	Domestic enterprises are more flexible in channel sinking and e-commerce channels
Brand	Strong brand trust	Domestic enterprises establish differentiated cognition in specific indications (e.g., fatty liver)
Innovation	Layout of next-generation products (oral, triple-target)	Domestic enterprises catch up quickly in multi-target and oral preparations

###5.2 Main Risk Factors

1. Patent litigation risk
   : Novo Nordisk has sued generic drug enterprises in India to try to extend patent protection [5]
2. Regulatory policy changes
   : Medical insurance negotiation, volume procurement and other policies may further compress price space
3. Clinical data competition
   : If domestic innovative drugs release better clinical data, they may change the market pattern
4. Capacity constraints
   : GLP-1 drugs have complex production processes; insufficient capacity may limit market expansion
5. Safety issues
   : Long-term use safety data still needs continuous monitoring

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##6. Investment Recommendations and Outlook

###6.1 Views on Novo Nordisk (NVO)

• Patent cliff in 2026 will bring significant pressure
  : Stock price has reflected part of the expectation (down 40% this year) [0]
• Price reduction strategy is necessary but not sufficient
  : Can delay but not prevent market share loss
• Long-term highlights
  : Progress of next-generation products (oral semaglutide, CagriSema, Amycretin)

: Current P/E ratio is , lower than historical levels, reflecting market concerns about the patent cliff. If next-generation products progress smoothly, there may be valuation repair opportunities.

###6.2 Views on Eli Lilly (LLY)

• Tirzepatide has a longer patent protection period
  (at least until the mid-2030s), providing a longer time window than Novo Nordisk [5]
• Stock price rose by 38.52% in 2025
  , reflecting market recognition of its leading position [0]
• Volume effect after entering China’s medical insurance
  is worth attention

: Current P/E ratio is , with high valuation, reflecting market’s high expectations for its growth. Need to pay attention to medical insurance volume and progress of next-generation products.

###6.3 Views on Domestic GLP-1 Enterprises

• Innovent Biologics
  : The dual-target advantage of Mazdutide and rapid commercialization capabilities make it one of the most potential challengers
• Hengrui Medicine
  : Strong clinical data of HRS9531 and comprehensive R&D strength are expected to break through after 2026
• Other enterprises
  : Need to find differentiated positioning in segmented markets to avoid homogeneous price wars

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##7. Summary and Outlook

###7.1 Core Conclusions

Novo Nordisk and Eli Lilly’s GLP-1 drug price reduction strategy is a

, with obvious strategic intentions:

✅

: Through price reduction combined with medical insurance access, it can effectively lock in market share in 2026-2027 and delay the impact of generic drugs

⚠️

: After patent expiration, biosimilar launch is irreversible; dual competition of domestic innovative drugs in efficacy and price will gradually erode original research drug market share

🔄

: Simple price wars are difficult to maintain long-term advantages; next-generation products (oral preparations, triple-target agonists, indication expansion) will determine who can maintain market dominance

###7.2 Market Pattern Outlook After 2026

[2]

• High-end market
  : Original research drugs and innovative drugs maintain premiums through differentiated advantages (efficacy, convenience, brand)
• Mid-end market
  : Biosimilars occupy the mainstream market at lower prices
• Mass market
  : With price reduction and medical insurance coverage, market penetration is expected to move from the current
  1%
  to the U.S. level of
  10%

: Including better efficacy, more convenient administration methods, and broader indication coverage.

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[0] Jinling API Data - Company overview, real-time quotes, financial data and analyst ratings of Novo Nordisk (NVO) and Eli Lilly (LLY)

[1] BioSpace - “Lilly Cuts Zepbound Prices, Again, When Buying Through DTC Program” (https://www.biospace.com/drug-delivery/lilly-cuts-zepbound-prices-again-when-buying-through-dtc-program)

[2] Sina Finance - “Halved, 20% off! Semaglutide and Tirzepatide Cut Prices Collectively; Weight Loss Drug Competition Moves Forward to 2026” (https://finance.sina.com.cn/jjxw/2025-12-27/doc-inhefcys0206757.shtml)

[3] Sina Finance - “Bollywood Star Endorsement, Price Plunged by 40%! Eli Lilly and Novo Nordisk Battle for Indian Weight Loss Drug Market” (https://finance.sina.com.cn/roll/2025-12-25/doc-inhcymnp5084707.shtml)

[4] Sina Finance - “Weight Loss Drug Launch Wave is Coming; Who Can ‘Beat’ Semaglutide?” (https://finance.sina.com.cn/jjxw/2025-12-23/doc-inhctxhr7106889.shtml)

[5] Wall Street Journal/Sina Finance - “Bollywood Star Endorsement, Price Plunged by 40%! Eli Lilly and Novo Nordisk Battle for Indian Weight Loss Drug Market” (https://finance.sina.com.cn/roll/