Novo Nordisk on Monday revealed weaker-than-expected data from a second late-stage trial of its obesity drug candidate CagriSema, knocking shares and stoking worries that rival Eli Lilly may be gaining an edge over the company in the weight-loss drugs market.

New trial data showed the drug helped obese or overweight type 2 diabetics lose an average 15.7% of their weight, when an earlier study recorded 22.7%.

Swiss drugmaker Roche on Wednesday announced a major deal in the weight-loss category, agreeing to pay up to $5.3 billion to Zealand Pharma in a licensing and development deal.

The setback comes at a crucial time for Novo Nordisk, which had positioned CagriSema as its next-generation weight-loss treatment. The current generation, made up of blockbuster drugs like Wegovy and Ozempic, have been cash cows for Novo.

Novo Nordisk stock tumbled Monday morning after disappointing trial results for its CagriSema weight-loss drug. Shares in rival Eli Lilly also sold off. Find out more:

After Zepbound-maker Eli Lilly reduced the price of the weight-loss drug, competitor Novo Nordisk has cut the price of weight-loss drug Wegovy.

Roche agreed to develop a weight-loss drug with Danish biotech Zealand Pharma, pressuring Novo Nordisk and Eli Lilly.

Key Takeaways Roche moved to enter the booming weight-loss drug market now dominated by Novo Nordisk and Eli Lilly.The Swiss pharmaceutical firm signed an exclusive agreement with Zealand Pharma to produce treatments using Zealand's experimental petrelintide injectable.