AstraZeneca‘s stock jumped nearly 5% after Britain’s most valuable company said its experimental lung disease medicine met its target in two late-stage clinical trials.
The respiratory treatment tozorakimab, reduced flare-ups of chronic obstructive pulmonary disease (COPD) in both former smokers and in the overall population versus placebo, the company said.
“This marks a notable shift in sentiment, given limited conviction in the IL-33 mechanism following prior IL-33 failures from Sanofi and Roche,” said Jefferies analysts.
Tozorakimab and rival drugs belong to a class of treatments called monoclonal antibodies. They work by suppressing the action of the protein interleukin-33 (IL-33) and can reduce inflammation.
“Today’s tozorakimab results deliver the first two confirmatory Phase III trials for an IL-33 biologic, which is a major scientific advancement in COPD, the world’s third leading cause of death,” said Sharon Barr, executive vice president of biopharmaceuticals and R&D at AstraZeneca.
“Tozorakimab works in a fundamentally different way from other biologics, inhibiting the signalling of the reduced and oxidised forms of IL-33 to both decrease inflammation and disrupt the cycle of mucus dysfunction that are key disease drivers in COPD,” Barr said.
The full results will be disclosed at an upcoming medical meeting, AstraZeneca said.
In July, Swiss drugmaker Roche reported mixed results for its COPD drug astegolimab, which ultimately failed to reduce flare-ups in a phase 3 study. Similar to tozorakimab, it is designed to stop the binding of IL-33.
AstraZeneca’s London-listed shares were last seen up 4.7% in midday trading, contrasting with the UK’s FTSE 100 index which fell 0.4%. Astra’s Friday update also lifted shares of Roche and Sanofi by around 1% each.
Multi-billion dollar potential
Nearly 400 million people are diagnosed with COPD, and it’s one of the leading causes of death worldwide, according to the World Health Organization.
It’s a progressive respiratory condition that manifests through breathlessness, chronic cough, and excess mucus production. Symptoms can worsen over time and contribute to ongoing inflammation and bronchoconstriction, making it difficult to breathe and increasing the risk of COPD exacerbations.
AstraZeneca has forecast tozorakimab peak annual sales of between $3 billion and $5 billion, whereas estimates on average put peak sales at about $1 billion prior to Friday’s trial results, according to FactSet.
The trial results showed a benefit for both former and current smokers, across all lung‑function severities.
It also indicated a benefit for patients with a low amount of a type of white blood cell called eosinophil, which is a key unmet need for about 35% of patients, Citi analysts noted.
Tozorakimab is also being studied in a Phase 3 trial for severe viral lower respiratory tract disease and in a Phase 2 trial in asthma.
Astra is planning to launch more than 20 new drugs over the next five years and has targeted $80 billion in annual sales by 2030.
A sign of Swiss pharmaceutical giant Novartis is seen on the top of a building at Novartis Campus in Basel, northern Switzerland, on Sept. 9, 2025.
Fabrice Coffrini | AFP | Getty Images
Novartis is planning to buy U.S.-based biotech Excellergy for up to $2 billion, betting on a next-generation allergy treatment that may prove to work faster and better than anything currently on the market, the Swiss pharmaceutical giant said Friday.
The acquisition will add Exl-111, an early-stage drug candidate, to Novartis’ existing allergy portfolio. It is the latest bolt-on deal in the company’s attempt to offset looming patent expirations.
It comes just a week after Novartis announced it is acquiring Synnovation subsidiary Pikavation Therapeutics for up to $3 billion to secure the rights to an experimental breast cancer drug.
Excellergy’s lead asset remains several years away from hitting the market. Novartis said it will pay the smaller biotech in both upfront and milestone payments, and the transaction is expected to close in the first half of 2026, subject to regulatory approvals.
Novartis stock traded sideways in morning trading in Zurich. Palo Alto-based Excellergy is privately held.
Shares of Novartis are up 33% over the past 12 months.
Many of the best-selling drugs in the world are facing a loss of exclusivity in key jurisdictions in what the sector calls “the patent cliff.” By the turn of the decade, companies risk losing hundreds of billions in revenue as branded drugs are exposed to generic competition.
Like the second half of 2025, early 2026 has seen a slew of M&A announcements from Big Pharma, including Merck announcing it has reached an agreement to buy Terns Pharmaceuticals for up to $6.7 billion earlier this week. Britain’s GSK and AstraZeneca are also among the companies that have announced several deals over the past months.
GSK’s global head of business development Chris Sheldon told CNBC late last year he is looking for acquisitions often in mid-stage development in the $1 billion to $2 billion range, where the biology is validated biology but the outcome of a drug candidate isn’t yet obvious. Like Novartis and AstraZeneca, GSK looks for so-called bolt-on deals that complement its portfolio and technology.
Novartis warned earlier this year that profits would decline in early 2026 as some of its best-selling drugs, including heart medicine Entresto face generic competition. Its second-best-selling medicine Cosentyx is expected to lose key exclusivities around 2029.
“For the first half of the year, we will have a tough prior year base with Entresto, Promacta and Tasigna generics having entered the U.S. market mid-2025,” said then-incoming CFO Mukul Mehta in a post-earnings call with analysts in February.
Novartis is seeing strong growth in other medicines such as cancer drug Kisqali and multiple sclerosis treatment Kesimpta, but still has to bulk up its pipeline to offset declines.
CEO Vas Narasimhan has said that the company is in the middle of the biggest patent expiration wave in the company’s history.
“It’s $4 billion that we will absorb over the course of this year across the three medicines,” Narasimhan told CNCB in February.
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Novo Nordisk was the first company to make a GLP-1 drug for weight loss and became Europe’s most valuable company.
But its troubles are stacking up and today the stock trades at just a quarter of what it did at its peak less than two years ago.
Pricing pressure, fierce competition, and pipeline setbacks have all hit the Danish drugmaker in recent months.
Despite being first to launch a GLP-1 drug for weight loss, Novo’s market share has eroded, and the company now only captures about 40% of the market, while rival Eli Lilly holds 60%, according to most estimates.
Novo is clear-eyed about the challenges it faces, especially around pricing. After the company pre-released its 2026 forecast earlier this month and predicted declining sales, CEO Mike Doustdar told CNBC: “People should expect that it goes down before it comes back up.”
He’s repeatedly said that new medicines, the Wegovy pill, and increased volumes will drive long-term growth.
These charts show the scale of the challenges Novo is facing.
Novo Nordisk is often referred to as a diabetes and obesity pure play. Its portfolio included six branded drugs with annual sales of at least $1 billion in 2025, fewer than comparable current and future rivals.
Eli Lilly boasts eight so-called blockbuster drugs, and its portfolio also includes oncology and gene therapies.
The combined sales of Ozempic and Wegovy, Novo’s two biggest drugs, amounted to about $32 billion, or about 67% of total sales, last year. Combined sales of Lilly’s two biggest drugs, Mounjaro and Zepbound, were about $37 billion, or about 56% of the company’s total sales over the same period.
Novo also sells insulin, including blockbusters Tresiba and NovoRapid, as well as some drugs for rare diseases like hemophilia, but none come close to bringing in what its GLP-1 drugs do.
Among large-cap pharma companies hoping to enter the market for weight loss drugs in the coming years, such as AstraZeneca, Roche, Amgen, and Pfizer, through its acquisition of Metsera, the number of blockbuster drugs was significantly higher.
Novo Nordisk has also come under pressure as prices for GLP-1 drugs are coming down in its most important market, the U.S.
The U.S. has accounted for more than half of Novo’s total sales since 2023, and falling prices there are weighing on both the company’s topline and profitability. Last year, Novo and Lilly reached a deal with the Trump administration to lower prices on their GLP-1 drugs on Medicare and Medicaid and offer the treatments directly to consumers at a discount.
“In 2026, Novo Nordisk will face pricing headwinds in an increasingly competitive market,” said CEO Mike Doustdar, as the company’s full-year earnings report was published earlier this month.
Novo stock is down 75% since peaking at just over 1,000 Danish kroner a share in mid-2024.
The stock is up a little over 10% over the last five years. That compares to Eli Lilly’s 400% rise and the European blue-chip index Stoxx 600‘s 55% gain over the same period.
Investors were last rattled on Monday when Novo reported disappointing results of a trial pitting its next-generation weight loss drug, CagriSema, against Eli Lilly’s tirzepatide, also known as Zepbound, sending the stock down over 16% on the day.
“Confidence in the share is at rock bottom,” said Jyske Bank analyst Henrik Hallengreen Laustsen on Tuesday.
Earlier this month, Novo Nordisk said it expected sales and profits to drop by between 5% and 13% in 2026. If that comes to be true, it would be the first time annual sales have declined since 2017, in local currencies.
Analysts surveyed by FactSet expect sales to come in about 8% lower in 2026 compared to 2025. Much of that is due to increasing competition from both Eli Lilly and compounding pharmacies that are selling copycat versions of Novo’s branded drugs for a lower price.
Longer term, other large-cap pharma companies are planning to enter the market, and are pitching investors more differentiated weight loss drugs to be able to secure a slice of the market share for themselves.
Novo is hoping CagriSema can beef up future sales, but after the latest trial results, analysts are increasingly doubting its commercial potential.
Novo said it is optimistic about the drug, and that further trials would assess its full weight-loss potential.
The Wegovy pill is another potential growth driver for Novo and had a strong launch. However, it remains to be seen how it will fare if Lilly launches its rival pill, expected to hit the market in the second quarter, and what effects lower prices might have on volumes.
This report is from this week’s CNBC’s UK Exchange newsletter. Like what you see? You can subscribe here.
The dispatch
Compass is that rare beast — a British company that is a genuine world leader in its field.
The world’s biggest contract caterer, which annually serves 5.5 billion meals in schools, colleges, workplaces, hospitals and sporting venues in more than 25 countries, is considered a well-run business.
Accordingly, its trading updates tend not to excite, routinely consisting of news on organic sales growth, margin improvements and — with workplace catering operations gradually being outsourced around the world — new business wins.
Last week’s update, though, brought something more eyebrow-raising as Compass announced that, from April 1, it will change the currency in which its shares are traded from sterling to the U.S. dollar.
The company explained that having reported in dollars since October 2023, the measure would align its share price trading currency with its reporting currency, “reducing FX volatility in the share price and simplifying the investment case for global investors.”
A large scale sample of the new twenty pound note featuring late British painter JMW Turner is seen during the launch event for the new note design at Turner Contemporary gallery in Margate, south eastern England, U.K., on October 10, 2019.
Leon Neal | Afp | Getty Images
Cue hand-wringing over how Compass — which derives around three-quarters of its revenues in dollars — could be the next big U.K. company to abandon London for the New York Stock Exchange.
Protests from Compass that it would continue to pay dividends in sterling, unless shareholders elect to receive them in dollars, fell on deaf ears.
Compass was, in fact, taking advantage of a relatively recent change to the so-called “ground rules” governing membership of indices overseen by FTSE Russell, part of LSEG, the owner of the London Stock Exchange.
Announced in March 2025, and coming into force last September, it allowed for companies whose shares trade in dollars or euros “to be considered for potential inclusion to the FTSE U.K. Index Series.”
In doing so, London has shown considerably more flexibility than some other major financial centers. The New York Stock Exchange, for example, insists that all NYSE-listed shares are quoted, traded and settled exclusively in dollars.
The first company to take advantage of the rule change, in January this year, was InterContinental Hotels Group, the parent of the Holiday Inn and Crowne Plaza hotel brands, which derives some 80% of its revenues and operating profits in dollars. If anything, it is even more British than Compass, dating back 249 years in the country. It is also proud of having registered the U.K.’s first trademark — the famous Bass red triangle — in 1875.
‘The accounts were not acceptable’
In a sense, changing the currency in which a company’s shares are traded is the logical next step in a process that began many years ago.
When companies were allowed to publish their report and accounts in currencies other than sterling, many started to do so. The three biggest companies in the FTSE 100 by market capitalization — HSBC, AstraZeneca and Shell — all now report in dollars. Unilever, the fourth largest, reports in euros. Others in the FTSE’s top 20 reporting in dollars include the miners Rio Tinto, Glencore and Anglo American, the oil major BP and the international bank Standard Chartered.
It is not a recent development. As long ago as 1989, the car rental company Avis Europe began accounting in the old European Currency Unit (ecu), the synthetic currency which later evolved into the euro.
The move caused some complications for the business at the time. Alun Cathcart, the chairman and chief executive, told the annual Ecu Banking Association meeting at Copenhagen in June 1991 that, when Avis Europe had first submitted its report and accounts for 1990-91, the U.K. authorities refused to accept them.
He recounted: “We were asked to produce coins and notes, and if we couldn’t, the accounts were not acceptable.
“They were prepared to accept a report in Icelandic crowns or Australian dollars, but not in ecu.”
When in April 1997, Avis Europe floated on the stock market, it became the first London-listed company to report in ecus.
At the time, though, Avis Europe was very much an outlier. Other U.K. corporate stalwarts have only made the switch relatively recently. Shell began reporting its results solely in dollars at the beginning of 1998, explicitly doing so to encourage meaningful comparisons with U.S. rivals, with BP following suit a year later.
In the same sector, BG Group, the gas exploration and production company spun out of the old British Gas and acquired by Shell in 2015, began dollar reporting in 2009.
All were beaten by Rio Tinto, which has been listed longer in London than any other of the major global mining companies. It embraced the greenback following the merger in late 1995 of the old London-listed Rio Tinto Zinc (RTZ) and its 49%-owned Australian associate Conzinc Riotinto of Australia (CRA).
So it is surprising that the announcement from Compass last week caused such pearl-clutching. Perhaps the bigger surprise should be that British multinationals like GSK, British American Tobacco, Rolls-Royce, Diageo, RELX and Reckitt Benckiser, despite making most of their money overseas, remain loyal to the good old pound.
Top TV picks on CNBC
Greg Stafford, Conservative MP, discusses the mounting pressure on U.K. Prime Minister Keir Starmer.
Jack Meaning, U.K. chief economist at Barclays, discusses the market implications of the political pressure on Starmer, and the economic outlook after the latest Bank of England decision.
Andrew Bailey, governor of the Bank of England, discusses the Monetary Policy Committee’s latest decision to hold rates at 3.75% as global uncertainty weighs.
Need to know
UK’s latest political standoff threatens to put a ‘Damocles sword’ over the country’s bond market, Jordan Rochester, head of FICC strategy at Mizuho EMEA, said in a Monday note. The prospect of a leadership challenge could upend the policy path laid down by Starmer and his finance minister, Rachel Reeves, which poses a significant risk to gilt investors.
Jeffrey Epstein has sparked a political crisis threatening the UK government. The release of further Epstein files last week triggered a series of events that left U.K. Prime Minister Keir Starmer fighting for his political life, despite the fact that he never knew the late financier and sex offender.
China lashes out at the UK’s expansion of a scheme for Hong Kong residents to apply for the British National Overseas, or BNO visa, calling it “despicable” and “reprehensible.” The U.K.’s move comes after a Hong Kong court sentenced pro-democracy media tycoon Jimmy Lai to 20 years in prison under a national security law.
Quote of the week
Labour seem to be mystified and terrified of the bond market in equal proportions.
— Kallum Pickering, chief economist, Peel Hunt
In the markets
The FTSE 100 has traded lower over the past week, closing Tuesday at 10,353.84, compared to 10,402.34 a week ago. Britain’s blue-chip index finished yesterday’s session down about 0.3% on the day.
The British pound, meanwhile, rose slightly against the dollar this week, trading at $1.3665, up from $1.3650 last Wednesday, as yields on the U.K. government’s benchmark 10-year bonds — also known as gilts — dipped over the same period, finishing Tuesday at 4.495%, compared to 4.552% a week ago.
The performance of the Financial Times Stock Exchange 100 Index over the past year.
