November 2025 Insights

First Mover Fatigue

Although first-mover advantage can lead to early scale and stronger brand recognition, it only creates lasting value when the early entrant converts timing into a structural advantage. We’ve seen this across industries, BlackBerry in smartphones and Myspace in social media. Both entered first, captured early dominance, but failed to innovate and were overtaken by superior fast followers. Novo Nordisk is now experiencing a similar dynamic in pharma. The company’s incretin portfolio, initially launched for type 2 diabetes and later expanded into obesity, transformed its financial profile, driving revenue from roughly $17 billion in 2017 to more than $42 billion today. But this once-uncontested growth trajectory has begun to face meaningful headwinds. Supply-chain constraints and persistent shortages opened the door to cheaper compounded alternatives, while intensifying competition from Eli Lilly’s next-generation therapies and ongoing leadership transitions added further uncertainty. Together, these pressures have driven a severe derating, with the share price declining nearly 70% from its peak in July last year.

As the first company to commercialize GLP-1s at scale, Novo enjoyed rapid early market penetration, strong prescriber familiarity, and a premium valuation. Ozempic quickly became a household name, particularly in the U.S., where its use among celebrities became an open secret and pop culture buzz amplified awareness. But in pharma, first-mover advantages are rarely durable without sustained clinical differentiation, disciplined lifecycle management, and consistent supply. The rise of Eli Lilly’s tirzepatide franchise illustrates this point clearly: with superior efficacy, broader label expansion potential, and a faster manufacturing ramp, Lilly has been able to gain share despite entering the market later. Today, Eli Lilly’s flagship drug holds an estimated 56% share of the incretin market.

Meanwhile, the strategic landscape continues to shift: the obesity market is projected to reach roughly $150 billion by 2030, and Lilly is positioned to compound its lead through large-scale U.S. manufacturing investments, a robust oral pipeline and next-generation alternatives. Both Lilly and Novo have signed pricing agreements with the U.S. government that, while potentially modestly weighing on near-term revenue, dramatically expand patient access by adding up to 40 million newly eligible Americans. At this stage, the fast follower has clearly outexecuted the first mover and is best placed to capture the next leg of market growth. Once again, superior clinical efficacy coupled with stronger operational execution has proven far more valuable than simply being first to market. This principle is embedded in our research process at High Street, where we prioritise companies with strong fundamentals, clear innovation leadership and management teams that consistently execute at a high level. Against this backdrop, Eli Lilly remains our preferred exposure in the obesity space.

Unless otherwise stated, all performance and statistical figures provided in this article have been pulled from Bloomberg by the High Street Asset Management Research Team on 28 November 2025 and all the images provided in this article have been sourced from FreePik and have been used in line with their Acceptable Use Policy.