Novo Nordisk Faces Setback. Here’s What Caused the Ozempic Maker’s Stock to Tumble Monday.

Novo Nordisk (NVO) shares tumbled Monday morning after the Danish drugmaker posted the latest results from a drug trial.

The company had been looking to determine whether semaglutide, the active ingredient in weight loss drugs Ozempic and Wegovy, could also slow the cognitive decline associated with Alzheimer’s disease. The trial’s goal was to slow the decline by at least 20%, CNBC reported, but Novo Nordisk said Monday that although the drug did improve unspecified “biomarkers” related to Alzheimer’s, it did not slow the progression of the disease itself.

Analysts had been uncertain of how likely the trial was to achieve its goals, and about whether demand for Ozempic and Wegovy is still growing. Morgan Stanley analysts downgraded the drugmaker’s stock in September.

“Based on the significant unmet need in Alzheimer’s disease as well as a number of indicative data points, we felt we had a responsibility to explore semaglutide’s potential, despite a low likelihood of success,” Novo Nordisk Chief Scientific Officer Martin Holst Lange said.

Alzheimer’s diagnoses, and the costs associated with the disease, have increased as Baby Boomers have aged. The costs are projected to continue rising in the coming years, passing $1 trillion by 2050. Rival drugmakers such as Eli Lilly (LLY) and Biogen (BIIB) each currently make other drugs that can slow the progression of Alzheimer’s.

Novo Nordisk’s U.S.-listed shares were down 6% in recent trading. The stock, which is trading at its lowest level in more than four years, has lost nearly half of its value since the start of the year as sales growth for its weight-loss drugs has slowed.