Newsletter · 2026-09-11 · Ashutosh Agarwal

Heart Drug Trial Failures Sink Novartis as Novo Admits Losing Ground to Lilly - The Healthcare Pulse - Week of September 11, 2026

The Healthcare Pulse for the week of September 4 to September 11, 2026: two genetically validated heart drugs from Novartis and Novo Nordisk failed their outcome trials, Novartis had its worst day on record and Amgen fell in sympathy, Novo's CEO explained candidly how Lilly took the obesity lead, and HSBC re-rated the large drugmakers on a stock-picking thesis.

The Healthcare Pulse: Weekly Podcast Intelligence Brief

Week of September 11, 2026: Heart Drug Trial Failures Sink Novartis as Novo Admits Losing Ground to Lilly

This Week at a Glance

If last week was about what to do with success, this week was about what to do with failure, and there was a lot of it. Three big, expensive, years-in-the-making heart-drug trials collapsed inside a few days, wiping tens of billions of dollars off two of Europe's biggest drugmakers and forcing the whole industry to ask an uncomfortable question: are the giant "prove-it-saves-lives" studies that investors love simply not worth running anymore?

A few threads ran through nearly every podcast and news feed:

• The cardiovascular field had a genuinely bad week. Novartis's cholesterol drug pelacarsen and Novo Nordisk's anti-inflammation drug ziltivekimab both failed to stop heart attacks and strokes in huge outcome trials, two "genetically validated" ideas that a lot of smart people believed in. One cardiologist-investor on a podcast said the double failure will make it "almost impossible" for small companies to raise money for this kind of research again.
• Novartis had its worst day on record, down over 10%, after a third setback in a week (a muscle-disease drug from its $12 billion Avidity takeover). Amgen fell nearly 10% in sympathy, because it has its own similar heart drug still being tested. Its CEO went on TV to defend the deal strategy.
• The obesity race got more candid and more crowded. Novo Nordisk's CEO gave a strikingly honest interview admitting exactly how his company lost ground to Eli Lilly, and laid out the comeback. New data landed on obesity pills, on a drug for six-year-olds, and on a possible once-a-week weight-loss pill.
• UnitedHealth kept reshaping itself, selling a chunk of its Florida clinic business to private-equity firm TPG and scrapping roughly 30% of its insurance "prior authorization" paperwork requirements. A board member called returning CEO Steve Hemsley "one of the greatest CEOs of our time."
• The whole healthcare sector sold off. The big healthcare ETF (XLV) fell about 2.85% on the week and biotech (XBI) about 2.63%, and analysts at HSBC used the moment to re-rate almost every large drugmaker at once, arguing the only way to make money in healthcare from here is picking individual stocks.

Below: the people, the debates, the numbers, and why each matters.

The People Driving the Conversation

Novo Nordisk's CEO, a 34-year company veteran and its first non-Danish chief, one year into the job, on Power Players with Brian Sozzi (September 7). This was the most revealing interview of the week: the head of the company that invented the modern obesity-drug era explaining, in plain terms, how it lost the lead to Eli Lilly and how it plans to get it back.

On losing market share, a rare public admission from a proud company:

"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%. And people felt at 21% weight loss, that's the next generation of the product and it's the better version of it. So that's the one I want. And that led into our market loss." Novo Nordisk's CEO

He was blunt that this stings on a human level, not just a financial one:

"Market share loss for me is not a numerical, graphical picture. It's five people that could have been on a GLP-1... that today are on a competing drug... that doesn't have the liver, kidney, and the cardiovascular benefits."

The comeback, in his telling, has three parts. First, a higher-dose shot, Wegovy HD (7.2 milligrams), that he says now matches Lilly's weight-loss numbers while carrying Novo's extra heart, kidney and liver benefits "almost a freebie." Second, the oral pill, which he says is crushing it:

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

He said the pill takes "9 out of 10 patients that want a pill" and delivers about 17% weight loss. When Sozzi noted that Wall Street (he cited a Goldman Sachs note) wants to see even faster uptake, the CEO pushed back on the impatience:

"Most people, including probably Goldman, will tell you 90% market share is a pretty good one... the market sometimes is, they're too impatient... We're building the company for decades to come. And we are patient, perhaps sometimes more than the market."

Third, new science: a drug called CagriSema (semaglutide plus a second hormone, amylin) is coming, and triple-hormone drugs are in the works. His bigger argument was that investors and doctors will stop lumping all these medicines together: "GLP-1s are not GLP-1s... There will be much better understanding of the differences." On the sheer runway ahead, he noted roughly 110 million Americans live with obesity, only about 15–20 million are on any of these drugs, and globally maybe 25 million, "still a fraction." (He's the CEO talking up his own company, so weigh the optimism accordingly.)

Biogen CEO Chris Viehbacher, on Squawk on the Street (September 9), live from the Wells Fargo Healthcare Conference in Boston. Biogen has quietly turned from a fading multiple-sclerosis company into something investors treat as a growth stock, and Viehbacher explained why:

"We've got 10 phase three programs that could now start to read out as early as next quarter... We could have five new molecules coming to market that could treat up to eight different diseases." Chris Viehbacher, Chief Executive Officer, Biogen

On Alzheimer's, where Biogen already has two approved drugs targeting amyloid, he pointed to early results going after a second protein, tau: "after six months, we had 70% of patients stable... and 60% actually showed some improvement." A prevention study (in people who don't yet have symptoms) reads out in 2028, "that could be a real game changer." On whether AI will invent new drugs, he was skeptical in a way worth hearing:

"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... It's a productivity tool. We have not seen, we don't look at it as a way of saving on headcount." Chris Viehbacher

Novartis CEO Vas Narasimhan, on Squawk on the Street (September 9), doing damage control after the stock's worst single day ever. His message: the setbacks are painful but normal, and the growth story is intact:

"On average about 60 percent phase three trials win across the sector. Actually, at Novartis, we've had an unbelievable run. I mean, since 2022, we've only had one major setback." Vas Narasimhan, Chief Executive Officer, Novartis

He reminded viewers that Novartis also had "one of our biggest wins of the year" the same week (remibrutinib in multiple sclerosis) and reaffirmed 5–6% annual sales growth through 2030. On the criticism that the $12 billion Avidity takeover now looks risky after one of its three drugs failed: "if we are able to get two of those three drugs over the finish line, we will have created a lot of value." Asked if this changes his appetite for deals: "I don't think so, Sarah... we have to be willing to take thoughtful risks."

Ethan Weiss, cardiologist at UCSF and biotech co-founder, on The Readout Loud (September 10), with the clearest explanation of why the week's heart-drug failures matter far beyond the two companies involved. The idea behind both failed drugs was "residual risk": the fact that even patients on statins and other optimal medicines still have heart attacks, so there must be another pathway to attack. Both targets (lipoprotein(a), and inflammation) looked bulletproof because they were "genetically validated." His verdict:

"The fact that these two quote unquote genetically validated targets both seem to fail is going to make the bar very high for somebody to want to do this again... If you're a big company... I would guess they're not going to be excited about doing these big trials for a little while. And I think for investors in small companies, I think it's going to be almost impossible." Ethan Weiss, UCSF

Dan Skelly, head of Morgan Stanley Wealth Management's market research team, on The Compound and Friends (September 4). He explained why healthcare has quietly been one of the year's rotation winners: when AI and semiconductor stocks wobbled over the summer, money flowed into other corners of the market:

"If I add in healthcare at 10% and financials at 15%, that's what really offset that cold metastasizing for the U.S." Dan Skelly, Morgan Stanley Wealth Management

He also thinks the obesity-drug hit to Big Food is very real: "when you look at Frito-Lay and some of the food businesses missing their organic revenue growth targets for like 2 to 3 years running, I think it's a very real thing... Look at the stock of Hershey. Horrible." And he made an optimistic case for AI in drug research and the companies that supply the tools for it:

"AI in many instances is taking a 6 to 7-year timeline in terms of phase 1 drug discovery. To like less than 12 months... And the downstream winners beyond that, the life science tools, the consumables, the lab and clinical trial managers." Dan Skelly

Dave Knapp, host of On The Pen and himself an obesity patient (September 8), made the emotional and scientific case for treating obesity in children after a trial in six-to-eleven-year-olds. The trial's headline: 40.4% of kids on semaglutide dropped below the obesity threshold after 68 weeks, versus 0% on placebo, and both groups got diet-and-exercise help, so the drug was the difference. His argument to skeptics:

"When someone says they're too young for medication, I think the next question has to be compared to what? Compared with another 6 years of severe obesity, compared with waiting for metabolic complications and type 2 diabetes." Dave Knapp, On The Pen

He noted a child with obesity at age three carries it into the teens at a rate near 90%, and teens carry it into adulthood at about 80%, but was careful to say the drug isn't a casual fix: "pediatric obesity treatment should be very deliberate. It should involve the proper monitoring of growth and nutrition."

The Key Debates

Debate 1: Are the giant cardiovascular outcome trials dead?

This was the defining argument of the week, and it's a big deal for how drug companies spend money.

• The "this is a real turning point" side: Ethan Weiss on The Readout Loud argued that after two genetically validated targets failed back-to-back, big pharma will pull back from these expensive, multi-year "does it prevent heart attacks" studies, and small biotechs will find them "almost impossible" to fund. His deeper point: genetics tells you what happens over a lifetime, "it doesn't tell you what happens in a short-term trial in people who are on a lot of other really powerful medicines."
• The "not so fast" side: The team at BioCentury This Week argued the failures may be about timing and technology, not the underlying biology. On lipoprotein(a), the drug may simply be reaching patients too late, after decades of damage; you might need to treat far earlier to see a benefit. And they teed up the next test: Amgen's olpasiran, a different type of molecule (an siRNA rather than Novartis's older "antisense" approach), is in a similar large trial (OCEAN) with data expected within a year. If Amgen's newer technology works where Novartis's failed, one host argued, "that would have a very big impact on the whole field of antisense versus siRNA."

The market didn't wait for the nuance: on the day BioCentury recorded, Amgen was down about 9% (roughly $21 billion of value) and even Eli Lilly ticked down 2% (about $25 billion) on the read-across.

Debate 2: Was Novartis's $12 billion Avidity deal a mistake?

• Bear case: Brew Markets laid out the damage: Novartis down over 10% on the failure of Deldezerin (the muscle-disease drug it bought in the Avidity deal), on top of the pelacarsen heart-drug failure and a cluster of cell-therapy trials paused after patient deaths. The context is a looming patent cliff: its heart drug Entresto brought in about $7.8 billion last year ("one out of every $7 Novartis made"), and Cosentyx nearly $7 billion, both losing protection.
• Bull case (from the CEO himself): Narasimhan argued two of the three Avidity drugs are on track (one already has a priority FDA review for a form of Duchenne muscular dystrophy), so "if we are able to get two of those three drugs over the finish line, we will have created a lot of value." Both sides agree on the real lesson, put simply on Brew Markets: "you can only de-risk drug development so much. At some point, the trial has to work."

Debate 3: How excited should investors be about Moderna and Merck's cancer vaccine?

• The bull view (from the market): Moderna's stock soared on the news that its personalized melanoma vaccine (intismeran, partnered with Merck) hit its goal in a late-stage trial, the first time a personalized cancer vaccine has shown this kind of benefit. Analysts raised Merck price targets on it.
• The skeptical view (from scientists who love the science): On The Immunology Podcast, the hosts were thrilled about the biology but wary of the stock reaction, partly because the actual data still hasn't been published:

"The stock price soared. Right. I have questions because they didn't put out the data... this is also a personalized vaccine. Every patient needs a one-off made... that is not going to be cheap... how much are they going to really sell given it's a one-off? ... Hold your horses on a 200% raise in the stock, maybe." The Immunology Podcast

Their point for investors: even a genuine medical breakthrough may be a modest business if each dose is custom-built and only some cancers (like melanoma, which carries many mutations to target) are a good fit.

Debate 4: Is the obesity-pill wave good or bad for the leaders? New data from Structure Therapeutics, discussed on On The Pen (September 8), showed its oral drug alenaglipron delivered up to 16.2% mean weight loss at 72 weeks (territory that until recently required an injection) with fewer than 5% of patients quitting over side effects. Knapp's investor-relevant insight was about manufacturing, not just efficacy:

"Alenaglipron is not simply semaglutide squeezed into a small tablet. It's a non-peptide small molecule... that potentially changes the economics of how these drugs are manufactured, scaled and shipped and eventually competed against." Dave Knapp

The bull reading: cheaper, easier-to-make pills expand the whole market. The bear reading: they invite more competitors and eventually push prices down. (He also flagged a much earlier, messier experimental pill, ACCG2671, with a long half-life that hints at a possible once-a-week weight-loss pill, but the study was tiny, just six people at the top dose, and all of them had nausea and vomiting.)

Debate 5: Is healthcare a genuine buy here, or a value trap? The whole sector fell this week (XLV about -2.85%, XBI about -2.63%), and HSBC responded on September 10 by re-rating almost every large drugmaker at once, with the explicit thesis that sector multiples are elevated and "bottom-up stock picking is the only source of alpha" (their phrase for: the easy gains are over, now you have to pick winners). Tellingly, HSBC's calls went both ways in the same note, lifting targets on Merck, Johnson & Johnson, Gilead and AbbVie while keeping a bearish "Reduce" on Eli Lilly and downgrading Amgen to Hold, calling it "trading around fair value" after this year's run. That split verdict is the debate in miniature.

Hot Topics Under Debate

• UnitedHealth sells clinics to private equity and cuts paperwork. On September 9, UnitedHealth agreed to sell its interest in its Florida WellMed/Optum clinics to private-equity firm TPG, part of fixing an underperforming Optum Health unit; shares fell about 1.8%. CFO Wayne DeVeydt's framing was revealing: "We didn't need the dollars... we needed the focus and somebody that could actually work with us locally." Separately, the company told providers it is eliminating roughly 30% of its "prior authorization" requirements (the pre-approvals that delay care) across its commercial, Medicare Advantage, Medicaid and ACA plans, a move even skeptics on health-policy podcasts welcomed as making it easier for patients to get care.
• A rough week for Novo Nordisk on multiple fronts. Beyond the CEO's candid interview: Novo halted two additional heart-failure trials of ziltivekimab on September 7 ("low likelihood of a different outcome"); its pediatric obesity trial (STEP YOUNG) succeeded on September 8; China approved semaglutide for the liver disease MASH on September 10; and on September 11 Morgan Stanley's Thibault Boutherin downgraded the stock to Underweight with a $40 target, warning that semaglutide is roughly 75% of 2026 sales and a patent cliff looms in the early-to-mid 2030s.
• Ultragenyx's gene therapy failure. Investors got a stark reminder of biotech's binary risk: Ultragenyx's apazunersen missed its goals in a late-stage trial for Angelman syndrome (a rare genetic disorder), and the stock fell about 44%. It's a cautionary backdrop heading into another Ultragenyx regulatory decision later this month.
• Medtech's robotics race heats up. On DeviceTalks, the hosts flagged that Medtronic "blew past Wall Street's high expectations" with double-digit revenue growth and a $700 million investment in Cornerstone Robotics, "some serious wonga," as one guest put it. Stryker is buying ZuraMed to strengthen shoulder surgery; J&J is rebranding Shockwave Medical and distributing Cornerstone's robot too. The upshot: surgical robotics is now a genuine three-way market (Intuitive Surgical's da Vinci, Medtronic's Hugo, and J&J), with the hosts wondering aloud whether market leader Intuitive will finally need a smaller, cheaper system to answer the competition.
• Intuitive Surgical, the fallen darling. On InvestTalk, a caller asked whether the surgical-robot leader is now a bargain after falling about 38% year-to-date. The host's honest answer was no: revenue growth has slowed from the mid-20s percent to around 10%, and "just because something has fallen down doesn't necessarily mean it's a value play." Verdict: watch list, not buy list.
• Merck's pipeline gets a chorus of upgrades. Following the Moderna/Merck melanoma data, analysts piled in on Merck: Wells Fargo and Guggenheim both went to $170, Leerink's Daina Graybosch to $161 (calling the second half of 2026 "catalyst-rich"), and HSBC to $172, a rare wave of agreement as investors look for what replaces the eventual patent loss of its mega-blockbuster Keytruda.

Emerging Themes to Watch

• Big Pharma is shopping to fill its patent cliffs, and China is the aisle. On Health:Further, the hosts noted GSK's roughly $1.3 billion purchase of HutchMed's early-stage cancer assets as the latest example, predicting a steady run of sub-$10-billion "tuck-in" deals concentrated in oncology and weight loss. The Prof G Pod zoomed out on the bigger structural shift: Chinese biotech is becoming the world's discovery engine, with the share of big deals sourced from China jumping from about 5% to 42%, and drug development there running perhaps a third cheaper.
• The technology behind a drug, not just its target, is becoming an investment call. The pelacarsen failure reopened a quiet but important debate covered on BioCentury: newer "siRNA" molecules tend to shut down their targets more completely and last longer between doses than the older "antisense" approach. If that pattern holds, it reshapes which companies (and which platforms) win in a whole set of diseases, and it's why Amgen's upcoming heart-drug readout is being watched so closely.
• Medicare Advantage is shrinking on purpose. Health-policy and insurance-broker podcasts flagged a striking trend: insurers are actively pushing members off Medicare Advantage plans to protect profits. On Paging America, data showed forced disenrollments jumping from a 1% average (2018–2024) to about 10% now, with roughly 600,000 Humana members affected in 2027. On Agent Boost Marketing, brokers reported that about one-third of Medicare Advantage plans will pay no commission in 2027, a backdoor way for carriers to cap enrollment. For investors, it signals insurers prioritizing margins over membership.
• The obesity drugs keep finding new jobs. Beyond weight, this week's podcasts covered GLP-1s moving into rheumatology and orthopedics. On Rheumnow's obesity journal club, tirzepatide combined with an arthritis biologic produced far better joint and weight outcomes than the biologic alone, and a separate trial showed semaglutide meaningfully cutting osteoarthritis knee pain. Every new use widens the market and strengthens the argument against employers dropping coverage.
• The Medicare "GLP-1 bridge" and the affordability squeeze. On the Pharmacy Podcast Network, a pharmacy director walked through Medicare's temporary program (running July 2024 through December 2027) offering a $50 monthly copay for these drugs versus list prices over $1,000, while noting even $600 a year is a real burden for seniors on fixed incomes, and it doesn't count toward deductibles. Access and price remain the story's central tension.

Stocks on the Radar

Direction reflects the tone of this week's podcast and news commentary, not a recommendation.

Upcoming Catalysts (Next ~2 Weeks)

• September 15–17, conference season kicks off: the Baird Global Healthcare Conference (Sept 15–16, New York), Fierce Pharma Week (Philadelphia) and RAPS Convergence (Charlotte). Management commentary from these events tends to move stocks in an otherwise earnings-quiet window.
• September 18, Nuvalent (NUVL) FDA decision on zidesamtinib, a lung-cancer drug (for ROS1-positive tumors). It would be the company's first commercial product, a genuinely binary event for the stock.
• September 19, Ultragenyx (RARE) FDA decision on UX111, a gene therapy for the rare childhood disease Sanfilippo syndrome type A. Higher-stakes than usual given this week's Angelman failure.
• September 21, Merck (MRK) FDA decision on expanding the label of its pulmonary-hypertension drug Winrevair (sotatercept).
• September 23–25, BioCentury Grand Rounds Europe (Amsterdam): a read on cross-border and China dealmaking momentum.
• "This fall," Moderna (MRNA) Phase 3 melanoma data for its cancer vaccine; the actual numbers (not just a press release) are what the skeptics are waiting for.
• Late September, the drug-pricing clock: CMS is finalizing its "maximum fair price" offers in the second round of Medicare drug-price negotiations, with a September 30 statutory deadline and prices taking effect January 1, 2027, a live revenue risk for the branded drugmakers.
• No large-cap healthcare earnings land in the window; the next big reporting wave is late October, so the near-term action stays regulatory, clinical and policy-driven.

An FDA decision for Ionis's Alexander-disease drug zilganersen appears on some calendars for September 22, but the drug was already approved earlier in the month as Zanvastro, so treat that one as done.

The Bottom Line

This was a week about failure, and what it teaches. Three big heart-drug trials collapsed, Novartis had its worst day ever, and Amgen fell in sympathy, and the real question wasn't about any one drug. It was whether the entire model of running huge, hugely expensive "prove it saves lives" studies still makes financial sense. When even "genetically validated" targets fail, as a cardiologist-investor put it, the bar to try again gets "very high" for big companies and "almost impossible" for small ones. That's the kind of shift that quietly redirects billions of R&D dollars for years.

But failure has a flip side: discipline and honesty. Novo Nordisk's CEO went on a podcast and simply told the truth about why his company lost the obesity lead (Lilly made a better drug) and laid out a concrete plan rather than spin. Novartis's CEO defended a bruised deal by pointing to the two-thirds of it that's still working. And HSBC re-rated the whole sector with a message investors are hearing everywhere now: the era of buying "healthcare" as a block is over; from here you have to pick the right names.

For anyone following the space, the throughline is that the science remains genuinely thrilling (a cancer vaccine that works, a weight-loss pill matching injections, kids' obesity treated for the first time) but the market has stopped paying for excitement alone. The heart-drug wreckage, the Moderna skepticism, the ISRG "watch list, not buy list" verdict all point the same way: investors want data they can hold, drugs that can actually scale and be paid for, and a clear answer to who wins when the patents roll off. The best stories this week weren't the ones that promised the most; they were the ones that were most honest about what could go wrong.