Novo Nordisk Faces Generic Competition and Regulatory Scrutiny Over Semaglutide Franchise
Novo Nordisk confronts rising generic threats to its semaglutide-based drugs while navigating FDA scrutiny and legal challenges. The company advances oral semaglutide into pediatric diabetes care as competitors prepare to launch imitations.
Pharmaceutical companies are lining up to launch imitations of Novo Nordisk's best-selling drugs when the patent on the super molecule semaglutide expires, while the Danish drugmaker simultaneously faces heightened regulatory scrutiny and legal challenges over its blockbuster obesity and diabetes medications.
Novo Nordisk's obesity treatment Wegovy and diabetes medication Ozempic are both based on semaglutide, a GLP-1 receptor agonist that helps regulate blood sugar and suppress appetite. Originally developed to treat type 2 diabetes, these medications gained widespread attention after clinical trials demonstrated significant weight loss in patients.
The company has completed a phase 3 study titled "Efficacy and Safety of Oral Semaglutide Versus Placebo Both in Combination With Metformin and/or Basal Insulin in Children and Adolescents With Type 2 Diabetes." The trial looks at how well oral semaglutide works and how safe it is in young patients, a group with few effective treatment options today. The study runs for about 66 weeks per participant, with 12 clinic visits and 8 phone calls. Key timing markers include the initial submission on 16 October 2020, the completion status now reported as "completed," and the latest update filed on 12 February 2026.
The study tests once-daily oral semaglutide against a placebo tablet. Both are added to standard care, which includes metformin and/or basal insulin plus diet and exercise, with the goal of improving blood sugar control in children and teenagers with type 2 diabetes. This is a randomized, parallel-group trial, meaning participants are split by chance into two groups that run side by side. It is "quadruple blind," so the patients, doctors, care teams, and outcome assessors do not know who gets semaglutide or placebo.
In January, Novo Nordisk launched the first GLP-1 pill for weight loss, marking a significant step in making the drugs more accessible.
As prescriptions climbed, the FDA increased monitoring of production, safety data, and marketing practices. Regulatory scrutiny in such cases typically focuses on three major areas: safety monitoring, manufacturing quality, and labeling and marketing. Like all GLP-1 medications, Wegovy and Ozempic carry potential side effects, including gastrointestinal issues. Regulators continuously evaluate post-market safety reports to determine whether additional warnings or updates are necessary.
Another issue drawing attention is drug supply. High demand has led to shortages, prompting concerns about compounded versions of semaglutide produced by certain pharmacies. The FDA has cautioned against unauthorized or improperly manufactured versions, emphasizing patient safety.
Beyond regulatory review, Novo Nordisk is navigating legal disputes related to its obesity and diabetes medications. Lawsuits have been filed by individuals alleging adverse effects not fully disclosed or adequately warned about. Plaintiffs in some cases argue that they experienced serious side effects and believe the company should have provided stronger warnings. Novo Nordisk, for its part, maintains that its products were rigorously tested, approved by regulators, and labeled according to FDA guidelines.
The obesity drug market is projected to reach tens of billions of dollars annually within the next decade. Competitors such as Eli Lilly have entered the space with rival GLP-1 therapies, intensifying competition. For Novo Nordisk, maintaining public trust is crucial. The company has invested heavily in expanding manufacturing capacity to meet demand and reduce shortages. It has also emphasized continued clinical research into long-term safety and expanded treatment indications.
Positive pediatric data could extend the semaglutide franchise beyond adults, deepening its lead in diabetes and weight-loss drugs. This may support long-term revenue growth and justify premium valuation versus rivals like Eli Lilly, while also reinforcing investor confidence that GLP-1 therapies have room to expand into younger and earlier-stage populations.