Andrew Silver
SHANGHAI (Reuters) – Novo Nordisk (NYSE:) faces the prospect of increased competition in a budding Chinese market where drugmakers are developing at least 15 generic versions of its diabetes drug Ozempic and weight-loss drug Wegovy, clinical trial records show.
The Danish drugmaker has high hopes that demand for its blockbuster drugs will grow in China, which is estimated to have the world’s largest population of overweight or obese people.
Ozempic received Chinese approval in 2021, and sales of Novo Nordisk’s drug in the Greater China region doubled last year to DKK4.8 billion ($698 million). Wegovy is expected to be approved this year.
But the patent on semaglutide, the active ingredient in both Wegovy and Ozempic, expires in China in 2026. Novo is also in the midst of a legal fight in the country over the patent.
An unfavorable court ruling could cause it to lose semaglutide exclusivity even sooner and make China the first major market where it will be stripped of patent protection on drugs.
These circumstances have drawn several Chinese drug makers into the fray. At least 11 potential semaglutide drugs from Chinese firms are in the final stages of clinical trials, according to records in a clinical trial database reviewed by Reuters.
“Ozempic has achieved unprecedented success in mainland China… and with patent expiration so close, Chinese drugmakers are looking to capitalize on this segment as quickly as possible,” said Karan Verma, medical research and data analytics specialist at information services provider Clarivate.
The company’s leader, Hangzhou Jiuyuan Gene Engineering, has already developed one drug that it says has “the same clinical efficacy and safety” as Ozempic, and applied for marketing approval in April. The company has not released efficacy data or responded to a request for information.
In January, the company said it expected approval in the second half of 2025, but warned it would not be able to commercialize the drug before Novo’s patent expires in 2026 unless a Chinese court makes a final ruling invalidating the patent.
The Danish company’s patent on semaglutide expires in China much earlier than in other key markets such as Japan, Europe and the United States. Analysts attribute differences in patent expiration dates to the extensions Novo has won in specific regions.
Even more pressing for Novo is a 2022 decision by the Chinese patent office that the patent was invalid for reasons related to the availability of experimental data, which the company has disputed.
China’s Supreme Court said it could not say when the verdicts would be ready.
A Novo spokesman said the company “welcomes healthy competition” and is awaiting a court ruling on the patent case. The spokesman did not respond to follow-up questions about the matter.
Other Chinese drugmakers conducting late-stage clinical trials of generic Ozempic include United Laboratories, CSPC Pharmaceutical Group, Huadong Medicine and a subsidiary of Sihuan Pharmaceutical Holdings Group.
In May, CSPC said it expected approval of its diabetes drug semaglutide in 2026.
Brokerage firm Jefferies estimated in an October report that United Laboratories’ semaglutide drugs would launch for diabetes in 2025 and obesity in 2027. United Laboratories did not respond to a request for comment.
IMPACT ON PRICES
According to a 2020 study by Chinese public health researchers, in 2030, the number of adults who are overweight or obese in China is expected to reach 540 million and 150 million, respectively, an increase of 2.8 and 7.5 times. 2000 level.
If Chinese pharmaceutical makers’ products are found to be as safe and effective as Novo’s, it will increase competition and drive down prices, analysts say.
Analysts at Goldman Sachs estimated in an August report that generics could push semaglutide prices in China down by about 25%. A weekly Ozempic injection costs about $100 for each 3ml dose in China’s public hospital network, Clarivate’s Verma said.
Novo acknowledges increased competition.
“In 2026 and 2027, we may see a few more players emerge due to ongoing clinical trials,” Maziar Mike Doustdar, Novo’s executive vice president, told investors in March, referring to the China market.
But he also questioned the ability of some players to provide meaningful volumes, adding: “We’ll keep an eye on that as we get closer.”
Novo also faces competition from global firms including Eli Lilly (NYSE:), whose diabetes drug Mounjaro won approval in China in May. HSBC analysts expect China to approve Lilly’s weight-loss drug with the same active ingredient this year or in the first half of 2025.
Eli Lilly did not respond to a request for comment on the Chinese approval of the drug, which is called Zepbound in the United States.
Supplies of Wegovy and Zepbound remain limited, but the companies are ramping up production.
Zuo Ya-Jun, CEO of weight-loss drug maker Shanghai Benemae Pharmaceutical, said a product’s competitiveness will depend on differentiating features such as effectiveness, treatment duration and the company’s sales capabilities.
“It will be a market with fierce competition, but it’s hard to say who will be (the leader),” she said.