# Novartis Loses 40 Billion Dollars After Three Drug Failures as Novo Fights Back - Healthcare Podcast Weekly Digest - Week of September 11, 2026

> Healthcare Podcast Weekly Digest for September 5 to 11, 2026: Novartis loses more than 40 billion dollars in value after three trial failures in one week, dragging Amgen and Eli Lilly on the Lp(a) read-across, while Novo Nordisk's new CEO lays out his comeback plan against Lilly, Dr. Oz touts 50 dollar Medicare GLP-1s, and dealmaking tilts toward early-stage and Chinese assets.

## Healthcare Podcast Weekly Digest

### Week of September 11, 2026: Novartis Loses 40 Billion Dollars After Three Drug Failures as Novo Fights Back

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## 1. Opening Summary

It was one of those weeks where the biggest healthcare news was about drugs that *didn't* work. Novartis, which spent the summer as one of the market's favorite big drugmakers, lost more than **$40 billion in stock-market value** after three of its experimental medicines failed in a single week, including a closely watched heart drug that a lot of scientists genuinely expected to succeed. The failures rippled straight into Amgen and Eli Lilly, which are chasing the same target.

At the same time, the obesity-drug story kept charging ahead. Novo Nordisk's new CEO went on a podcast to admit, out loud, that his company has been losing ground to Lilly, and to explain exactly how he plans to win the customers back. The head of Medicare said GLP-1 weight-loss shots are now $50 a month for some seniors, with more than 600,000 people signing up in two months.

Underneath all of it, three themes kept surfacing across the week's podcasts: money is pouring into **early-stage biotech deals** (and increasingly into China), Washington is squeezing **doctor and hospital payments**, and healthcare stocks have quietly become the market's **safe haven** as bond yields climb. Here's what the people actually saying these things said, and why it matters for the stocks.

Quick plain-English note: a **"phase 3 trial"** is the large, final human test a drug must pass before approval; a **"patent cliff"** is when a blockbuster drug loses its patent and cheap copies crush its sales.

## 2. Key People This Week

| Person | Role / Affiliation | Where | What they said, in one line |
|---|---|---|---|
| **Vas Narasimhan** | CEO, Novartis | Squawk on the Street (CNBC), Sept 9 | Stands by 5–6% growth through 2030 despite three trial failures in a week. |
| **Chris Viehbacher** | CEO, Biogen | Squawk on the Street, Sept 9 | "10 phase-3 programs" could start reading out next quarter; Biogen is finally a growth story again. |
| **Mike Doustdar** | CEO, Novo Nordisk | Power Players with Brian Sozzi, Sept 7 | Admits losing share to Lilly; oral Wegovy pill was "the best product launch of any pharmaceutical company to date in volume." |
| **Dr. Mehmet Oz** | Administrator, CMS (Medicare) | Squawk Pod (CNBC), Sept 8 | GLP-1s now "$50 a month" for some seniors vs "over $1,000"; 90% of branded drugs now under the new pricing rules. |
| **Ethan Weiss** | Cardiologist, UCSF; CSO, Mireya Therapeutics | The Readout Loud (STAT), Sept 10 | On the heart-drug failures: "genetics is undefeated... We cannot say that anymore." |
| **Bill McNabb** | Former CEO, Vanguard; UnitedHealth board | Masters in Business (Bloomberg), Sept 4 | Calls returning UNH CEO Steve Hemsley "one of the greatest CEOs of our time." |
| **Subin Baral** | Life Sciences Deals Leader, EY-Parthenon | BioTalk with Rich Bendis, Sept 8 | 60% of 2026 deals are for early-stage assets, vs a 43% historical norm. |
| **Ruby (author, "The China Cure")** | Physician / China biotech expert | The Prof G Pod, Sept 8 | China's share of big drug-licensing deals jumped from 5% (2020) to 42% (H1 2026). |
| **Dr. Inna Husain / Dr. Brown** | Otolaryngology leaders | Voices of Otolaryngology, Sept 10 | 80% of surveyed ENT doctors would stop or cut Medicare patients under proposed pay cuts. |

## 3. Hot Topics

### Novartis: three strikes in one week

The dominant story. On the **Brew Markets** podcast (Sept 8) and **BioCentury This Week** (Sept 9), the timeline was laid out: in late August, Novartis paused trials of a cell therapy after several patient deaths; then its cholesterol/heart drug **Pelacarsen** failed; then a muscle-disease drug, **del-desiran** (the crown jewel of its **$12 billion purchase of Avidity Biosciences** earlier in 2026), flopped in a late-stage trial. The result, per BioCentury: **more than $40 billion wiped off the company's value**, with its worst single trading day on record.

Why investors cared so much about the heart drug specifically: it targeted **lipoprotein(a)**, or "Lp(a)", an inherited risk factor that roughly **one in five people** carry and that today has no approved treatment. On **The Readout Loud** (Sept 10), UCSF cardiologist Ethan Weiss explained the gut-punch:

> "We would use the line, genetics is undefeated. That it always... predicted which drugs were going to work in outcome studies. We cannot say that anymore."

The read-across hit competitors immediately. BioCentury noted **Amgen fell ~9% (about $21 billion)** and **Eli Lilly ~2% (about $25 billion)** the same day, because both are developing rival Lp(a) drugs. One technical wrinkle the analysts flagged: Novartis's drug is an older "antisense" type that knocked Lp(a) down about **80%**, while Amgen's newer "siRNA" approach reportedly reaches the **upper 90s**, so Amgen's trial (reading out within roughly a year) may still tell a different story.

Novartis CEO **Vas Narasimhan** went on **Squawk on the Street** (Sept 9) to steady the ship. His defense:

> "Since 2022, we've only had one major setback... if you were to zoom out on our overall TSR and share price performance over five years, it's been at the top of the sector."

He insisted the Avidity deal still works if two of its three drugs succeed, kept the **5–6% annual growth guidance through 2030**, and noted his multiple sclerosis pill **remibrutinib** looks like "potentially the best oral medicine... developed for MS to date." The context that makes this urgent, per Brew Markets: Novartis's mega-drug **Entresto brought in ~$7.8 billion last year, one of every seven dollars of sales**, and is already losing patent protection, with **Cosentyx (~$7 billion/yr)** facing its own cliff later this decade.

### Obesity drugs: Novo fights back

On **Power Players with Brian Sozzi** (Sept 7), Novo Nordisk's new CEO Mike Doustdar was strikingly candid about losing the weight-loss crown to Eli Lilly:

> "They brought a product to the market that provided 21–22% weight loss while the current version of ours at the time was 15–16%... So that's the one I want. And that led into our market loss."

His comeback plan, in his words: a higher-dose **Wegovy HD (7.2 mg)** that matches Lilly's ~21–22% weight loss, plus the new **oral Wegovy pill**, which he says has been a runaway hit:

> "Six months into the launch, we just announced 5 million prescriptions... that's the best product launch of any pharmaceutical company to date in volume."

He claims **9 out of 10** patients who want a pill are choosing Novo's over Lilly's, and teased next-generation combos like **CagriSema**. His framing of the market size is the bull case in a nutshell: about **110 million** Americans have obesity, but only **15–20 million** are on any GLP-1, "still a fraction."

### UnitedHealth: a turnaround under a returning legend

Beyond the news flow (below), the most human take came from **Bill McNabb** (former Vanguard CEO and UnitedHealth board member) on **Masters in Business** (Sept 4). He described a company hit by "one crisis after another" from outside forces, and gave a glowing endorsement of returning CEO Steve Hemsley:

> "One of the greatest CEOs of our time. You know, most people don't know his name, but his ability to see around corners and make hard decisions and then go and execute. It's incredible."

## 4. Key Debates (Bull vs. Bear)

**Debate 1: Are drugmakers overpaying for risky, early-stage science?**

- **Bear:** Novartis just torched a chunk of a **$12 billion** acquisition when its lead asset failed. On Squawk on the Street, the interviewer pressed Narasimhan directly on "whether you guys and others are paying too much for these late-stage biotech assets."
- **Bull:** Narasimhan argued the science, not the price, is the risk: "about 60% [of] phase-3 trials win across the sector," and the Avidity deal still pays off if the other two drugs land. EY's **Subin Baral** (BioTalk) framed the whole industry's pivot to early-stage bets as a deliberate, portfolio-style strategy, not recklessness.

**Debate 2: Who pays for GLP-1 weight-loss drugs, and does it pay off?**

- **Bull (CMS's Dr. Oz, Squawk Pod):** Getting people healthy is worth it to the government: "if we can get the average American to... want to work one extra year... that's worth $1 trillion to our GDP every year," and cost curves already "start to see a downward slope" within two years.
- **Bear (the Squawk hosts):** Bank of America's Brian Moynihan is spending "**$250 million a year**" on GLP-1s for employees (up from zero a few years ago), and the long-term savings may accrue to *society*, not to the employer footing the bill, especially if that worker leaves.

**Debate 3: Was the whole Lp(a) heart-drug thesis wrong?**

- **Bear (Ethan Weiss, Readout Loud):** Maybe the target only matters modestly once patients are on today's good drugs (statins, PCSK9 inhibitors): "the risk of Lp(a)... is actually pretty modest."
- **Bull (BioCentury panel):** It may be a molecule problem, not a target problem: Novartis's ~80% knockdown may simply be too weak, and Amgen's near-100% siRNA could still separate from placebo. Notably, Novartis itself **hedged**, licensing a Chinese siRNA Lp(a) drug (from Argo Biopharma) for $160M and $185M upfront.

## 5. Emerging Themes

- **Healthcare as the market's safe haven.** With bond yields climbing (one strategist on Squawk on the Street said the 10-year Treasury could hit 5% "within the next month"), money is rotating into defensive healthcare names. The sector ETF (XLV) is up roughly **+10.8% year-to-date and +24.8% over one year**, trading near a 52-week high, anchored by Lilly, Merck, AbbVie, J&J and Gilead.
- **China as a genuine drug-innovation engine, not just a factory.** On **The Prof G Pod** (Sept 8), the author of "The China Cure" laid out the numbers: China's share of big (>$50M) out-licensing deals leapt from **5% in 2020 to 30% in 2025 to 42% in the first half of 2026**. AstraZeneca signed an **$18.5 billion** deal with China's CSPC in March. She thinks China could produce **30% of the world's new drugs by 2030**, and noted the US imports roughly half its basic drug ingredients from China.
- **The "invisible market" of cash-pay healthcare.** On **Edge Perspectives** (Sept 9), Vizient's Emily Fitt sized just the direct-to-consumer GLP-1 slice: 10 virtual weight-loss companies alone have "**about 6.3 million yearly subscribers and about $4 billion of revenue per year**", spending that never even shows up in insurance claims.
- **A new hair-loss gold rush.** **Morning Brew Daily** (Sept 4) flagged that investors are treating baldness drugs as "the second coming of the weight loss revolution." Shares of **Verodermix (ticker MANE)** are up nearly **500% since its February IPO**, and **AbbVie has more than doubled**. The prize: ~50 million men and 30 million women in the US, with no new drug approved in almost three decades. Watch Cosmo (Clascoterone), Verodermix (a minoxidil pill), and AbSci (an AI-designed injectable).
- **AI in drug R&D is a productivity tool, not a magic wand, for now.** Biogen's Viehbacher on Squawk on the Street: "It's not... going to revolutionize business. And I don't think it's going to find new drugs. But scientists who know how to use AI are going to be a lot more productive," mainly by finding clinical-trial patients faster.

## 6. Deals & M&A Tracker

| Deal | Value | Notes |
|---|---|---|
| **UnitedHealth (Optum) → TPG** | Stake sale (undisclosed) | Sept 9: UNH sold an equity stake in its Florida WellMed senior primary-care clinics to private-equity firm TPG to refocus its struggling Optum Health unit. CFO Wayne DeVeydt: "We didn't need the dollars... but we needed the focus." (Bloomberg) |
| **Eli Lilly → Merida Biosciences** | up to **$2.875B** cash | Announced Aug 31, closing Q4 2026. Autoimmune/allergy antibody drugs; called Lilly's 13th major deal of 2026. |
| **Novartis → Alteogen** | **$3.2B** | Sept 2, part of the pipeline-rebuilding push. |
| **Roche → Simcere** | **$1.53B** | Sept 1. |
| **AstraZeneca → CSPC (China)** | **$18.5B** | Referenced on The Prof G Pod as the largest China licensing deal to date (signed earlier in 2026). |

Big-picture deal color from **EY's Subin Baral** (BioTalk, Sept 8): first-half 2026 saw **221 qualifying deals**; **60% targeted pre–phase-3 assets** (vs a 43% ten-year average); the bulk were **$1–10 billion** (only five topped $10B); and big pharma made up just **45% of spend, down from 69% in 2025**, as mid-sized players are now doing the buying. Separately, industry data cited in the week's reporting put **first-half 2026 life-sciences M&A at ~$196 billion, up ~140% year-over-year**, ahead of the coming patent cliff.

## 7. Regulatory Watch

- **"Most Favored Nation" drug pricing is now the law of the land, for now.** On **Squawk Pod** (Sept 8), CMS Administrator Dr. Mehmet Oz said **90% of branded drugs sold in America are now under MFN pricing** (tying US prices to cheaper overseas prices), calling it "the biggest drop in prices in 63 years." The catch he flagged himself: the contracts are voluntary and "expire after the administration completes its term," so he wants **Congress to codify** them. Roughly **26 firms (~89% of branded US prescriptions)** have signed, in exchange for a 0% pharma tariff through 2029.
- **Medicare GLP-1 access expands.** Per Dr. Oz: **$50/month** GLP-1s for some Medicare beneficiaries (vs $1,000+), with **600,000+ enrollees in two months**.
- **Proposed physician pay cut sparks revolt.** On **Voices of Otolaryngology** (Sept 10), leaders detailed a CMS proposal to cut payment for additional same-day services (the "modifier 25" rule) by **50%**. A survey of **1,400 ENT doctors** found **80% would stop seeing or sharply limit Medicare patients**. Dr. Brown noted cumulative cuts of ~33% since 2000 and warned of delayed cancer diagnoses in rural areas: "We're not asking for a compromise. We're asking for them to completely abandon this pay discount."
- **Medicaid funding squeeze.** On **A Health Podyssey** (Sept 9), analysts explained that H.R.1 caps Medicaid "state-directed payments" at Medicare-equivalent rates starting July 2025; the CBO estimates **$149 billion in federal savings over 10 years**, hitting the 39 states that pay providers above Medicare rates.
- **DOJ probe of UnitedHealth continues.** No new settlements in early September; the civil-and-criminal investigation into Medicare Advantage coding is ongoing, with UNH cooperating.
- **FDA leadership churn.** A new CDER (drug-evaluation) chief was named this week amid heavy turnover. Biogen's Viehbacher: despite "a lot of turbulence," the FDA has "maintained their timelines," with approvals still flowing.

## 8. The Week Ahead

- **UnitedHealth guideposts:** Management reaffirmed FY2026 adjusted EPS of **$19.50–$20.00**, a full-year medical cost ratio around **88.1%**, and raised its buyback to at least **$5.0 billion** (from $2.5B) at the Wells Fargo Healthcare Conference (Sept 9). Analysts stayed constructive: Wells Fargo Overweight **$526**, Bernstein Outperform **$512**, Barclays Overweight **$441**. Watch for any DOJ-probe headlines.
- **Eli Lilly price-target spread is enormous.** HSBC nudged its target to **$940** but keeps a *Reduce* rating ("bottom-up stock picking is the only source of alpha"), while the broader analyst average sits near **$1,350**, a wide gap worth watching into any Lilly news.
- **Lp(a) act two:** **Amgen's** phase-3 heart-drug trial (a near-100% knockdown siRNA) is expected to read out within roughly a year, the single most important data point for whether the Lp(a) thesis is dead or just wounded. **Eli Lilly** also has an Lp(a) program in the field.
- **Biogen catalyst cluster:** CEO Viehbacher says up to **10 phase-3 readouts** begin "as early as next quarter," spanning rare kidney disease, lupus, Dravet syndrome and next-gen spinal muscular atrophy, with potential regulatory filings as soon as next year.
- **China conference season:** The 13th China Healthcare Summit (Shanghai, Nov 2–4) will be a barometer for the cross-border dealmaking that dominated this week's M&A chatter.

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