Novo Nordisk (NYSE:NVO) is caught in a double bindtrade tensions and legal battlesthat could shake up its market position. CEO Lars Fruergaard Jorgensen cautioned that the Trump administration's proposed tariffs on pharmaceutical imports could drive up drug prices and disrupt supply chains. With new 25% tariffs already in place on imports from Canada, Mexico, and China, the pharmaceutical giant faces rising costs, especially for generics that rely on overseas ingredients. If these tariffs expand to Europe, Novo may be forced to raise prices or rethink its sourcing strategyboth moves that could have ripple effects on its bottom line.

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At the same time, Novo is stepping into a legal showdown over the FDA's decision to end the semaglutide shortage, a move that impacts Ozempic and Wegovy. A federal judge just granted the company permission to intervene in a case challenging the FDA's decision to end the shortage status of semaglutide, the key ingredient in both drugs. With compounding pharmacies forced to stop producing alternative versions, Novo is defending its exclusivity in a battle that could determine the future availability of lower-cost alternatives. A similar fight is playing out with Eli Lilly's (NYSE:LLY) tirzepatide, signaling broader tensions between regulators, pharmaceutical giants, and compounding pharmacies.

For investors, the stakes are high. If tariffs take a bite out of margins, Novo could face pricing pressure just as demand for its weight-loss and diabetes treatments soars. On the flip side, if the court ruling swings in Novo's favor, it locks in its dominance over semaglutide, reinforcing its competitive moat. Either way, the next few months will be a critical test for the pharma giant as it navigates trade headwinds and regulatory scrutiny in a fast-evolving landscape.