Novo Nordisk seeks court order to halt Eli Lilly obesity drug ads

Novo Nordisk (NVO) said it is seeking a preliminary US court injunction to immediately block obesity and diabetes drug advertisements by Eli Lilly (LLY), escalating a legal battle between the two dominant players in the lucrative weight-loss drug market.

Novo announced that it had sued Lilly, arguing consumers were being misled about how the companies' products compare, and warned it would seek a preliminary injunction if the American company did not voluntarily remove the disputed ads. Lilly on Friday denied any wrongdoing, saying it stood by its advertising and would vigorously defend itself.

The two companies are locked in a fierce contest for dominance in the obesity drug market, which analysts expect to be worth more than $100 billion by the end of the decade in the United States alone.

Novo said in a statement that Lilly's ads were based on "outdated studies," creating a false impression that the American firm's drugs are vastly superior to its own. "Novo Nordisk is seeking a court order on an expedited basis to ensure people can access the accurate, complete picture of the treatments available to them today," it said.

Novo's lawsuit alleges that Lilly violated false advertising and unfair competition laws through its campaigns for obesity drug Zepbound and diabetes treatment Mounjaro. The Danish company claims Lilly compared the highest approved doses of those medicines against lower doses of Novo's Wegovy and Ozempic, while omitting newer, higher-dose formulations of Novo's drugs that it says deliver greater weight loss.

Lilly pushed back sharply. "Novo Nordisk has never tested its highest doses of semaglutide against Lilly's tirzepatide medicines in any clinical trial; instead, it is using a lawsuit to advance comparisons it has never put to the test," a company spokesperson said. Novo's lawsuit seeks a permanent injunction requiring Lilly to withdraw the campaigns and run corrective advertising.

Analysts were divided over the strategy. BMO's Evan Seigerman said the lawsuit reflected a more combative posture from Novo in managing public perception of how the two companies' drugs perform. "What it shows from my perspective is that Novo is taking a more aggressive stance in managing its business — they're not just going to let Lilly say whatever they want," he said.

But Sven Borho, managing partner at OrbiMed, whose firm manages the portfolio of Lilly shareholder Worldwide Healthcare Trust and held a short-term position in Novo until May, was more skeptical. He argued Novo should instead direct its energy toward its pipeline, noting that "Lilly has been outcompeting them on the R&D front as well." Going to court, he said, "is not going to help them in their marketing battle."