Ozempic’s maker got crushed. The rebound is under way.

Novo Nordisk, maker of Ozempic and Wegovy, has a reputation for squandering its lead.

- David Wainer [e-mail]

It was first with the weight-loss injection Wegovy, yet Eli Lilly’s Zepbound seized the top position. Now Novo is poised to debut a Wegovy pill early next year, pending U.S. regulatory approval. But Lilly’s rival tablet is expected soon after—and could once again come out on top.

Playing second fiddle to Lilly has weighed heavily. Novo’s stock is down more than 50% in the past year.

That reflects slowing growth because of Lilly’s market-share gains, as well as a swelling market for knockoff GLP-1 drugs. Signs of a turnaround are emerging. Novo shares rallied after the company reported positive clinical data for its obesity program, including news Wednesday that the Wegovy pill produced weight loss comparable to that of the weekly injection. Yet the U.S. shares trade at about 15 times forward earnings—on par with the slower-growing pharmaceutical sector. Eli Lilly, by contrast, fetches 27 times.

Fairly or not, Novo has earned a reputation for moving too slowly—whether in increasing supply, confronting compounders or investing in direct-to-consumer marketing. It now needs to convince investors that it can move with more urgency.

The new chief executive, Mike Doustdar, has wasted little time sending that signal. Earlier this month, Novo said it would cut about 11% of its workforce. For a company long steeped in cautious Danish culture, such a drastic move marks a clear break with the past.