Ozempic’s Growing Generic Competition

Novo Nordisk Faces Growing Generic Competition for Ozempic and Wegovy in China

Danish pharmaceutical giant Novo Nordisk is bracing for a significant rise in competition in the Chinese market. This challenge comes as numerous drug manufacturers in China are developing at least 15 generic versions of Novo Nordisk’s popular diabetes and weight loss medications, Ozempic and Wegovy, as revealed by clinical trial records.

The Chinese market, with its high prevalence of overweight and obese individuals, represents a substantial opportunity for Novo Nordisk. The company has been optimistic about the demand for its blockbuster drugs. Ozempic, approved in China in 2021, saw its sales in the Greater China region double to 4.8 billion Danish Krone ($698 million) last year. Wegovy, another major product, is anticipated to receive approval later this year.

However, the patent for semaglutide, the active ingredient in both medications, is set to expire in China in 2026. Adding to the challenge, Novo Nordisk is currently engaged in a legal battle over the patent’s validity in the country. An unfavorable court ruling could lead to an earlier loss of exclusivity, making China the first significant market where Novo Nordisk would lose patent protection for these drugs.

Rising Competition

The looming expiration has already attracted multiple Chinese pharmaceutical companies. According to clinical trial databases, at least 11 semaglutide drug candidates from Chinese firms are in the final stages of clinical trials.

“Ozempic has achieved unprecedented success in mainland China,” noted Karan Verma, a healthcare research and data analyst at Clarivate. “With the patent expiry approaching, Chinese drugmakers are eager to capitalize on this segment as soon as possible.”

One leading contender is Hangzhou Jiuyuan Gene Engineering, which has developed a treatment claiming similar efficacy and safety to Ozempic. The company has applied for approval to market its product and expects a decision by the second half of 2025. However, commercial production will not commence until Novo Nordisk’s patent expires in 2026 unless a Chinese court invalidates the patent sooner.

Patent Disparities and Legal Battles

The early expiration of Novo Nordisk’s semaglutide patent in China, compared to its expiration timelines in other key markets like Japan, Europe, and the U.S., is partly due to regional patent term extensions. More pressing is a 2022 ruling by China’s patent office that invalidated the patent over issues related to experimental data availability. Novo Nordisk is challenging this ruling, and China’s top court has yet to indicate when a verdict will be announced.

“We welcome healthy competition,” a Novo Nordisk spokesperson commented, while awaiting a court decision on the patent dispute.

Other Chinese companies in the race to develop semaglutide generics include United Laboratories, CSPC Pharmaceutical Group, Huadong Medicine, and a subsidiary of Sihuan Pharmaceutical Holdings Group. CSPC expects approval for its semaglutide diabetes drug in 2026, while Jefferies brokerage forecasts United Laboratories will launch its semaglutide drugs for diabetes in 2025 and for obesity in 2027.

Market Dynamics and Pricing Pressure

China is projected to have 540 million overweight adults and 150 million obese adults by 2030, a substantial increase from 2000 levels. Should Chinese generics prove to be as safe and effective as Novo Nordisk’s products, they are expected to increase competition and drive down prices. Analysts at Goldman Sachs anticipate a 25% price reduction for semaglutide in China, with the weekly Ozempic injection currently costing around $100 for each 3mL dose through China’s public hospital network.

Novo Nordisk acknowledges the impending competition. “In 2026 and 2027, we might see a few more players showing up due to ongoing clinical trials,” said Maziar Mike Doustdar, a Novo executive vice president, in a March investor briefing. However, he expressed skepticism about some competitors’ ability to produce significant volumes, indicating that the company would monitor the situation closely.

Novo Nordisk is also facing competition from global pharmaceutical companies like Eli Lilly, whose diabetes drug Mounjaro was approved in China in May. HSBC analysts predict that Eli Lilly’s weight loss drug, with the same active ingredient, will receive Chinese approval by early 2025. Both Wegovy and Eli Lilly’s U.S. version, Zepbound, have had supply constraints, but production is ramping up.

Future Outlook

The competitive landscape for weight loss and diabetes treatments in China is expected to become increasingly fierce. “The market will be highly competitive, and who will emerge as the leader is difficult to predict,” stated Zuo Ya-Jun, general manager of Shanghai Benemae Pharmaceutical, a weight loss drug manufacturer.

Novo Nordisk’s ability to maintain its market position in China will hinge on the outcome of its patent disputes and its strategic responses to the emerging generics. As the Chinese pharmaceutical landscape evolves, Novo Nordisk must navigate these challenges to sustain its growth and market share in this crucial sector.