u/JRNotDallas ·
Reddit — r/ValueInvesting
· February 23, 2026 at 13:51
· ⬆ 15 pts
· 💬 43 comments
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AI Summary
Summary
The post discusses the failure of Novo Nordisk's drug candidate, CagriSema, and uses it as a case study for the risks of investing outside one's circle of competence, particularly in complex sectors like biopharma.
The author's thesis is that many investors in Novo Nordisk were overconfident and lacked a deep understanding of the underlying science, leading to losses. They argue that biopharma is a highly cyclical and specialized industry where expertise is crucial for success.
Quality assessment: This is a high-level commentary and cautionary tale, not detailed due diligence (DD). It uses a specific event (CagriSema failure) to make a broader point about investment philosophy rather than providing a deep analysis of the event itself. It is primarily an opinion piece.
Score15
Comments43
Upvote %67%
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Really don’t want to add to discussion around Novo because I think everyone is fed up of it to be honest, but I feel there’s an important point to be made today.
I’ve spoken to a lot of people on this sub about Novo Nordisk and their over confidence in the data their drugs can produce. One thing that’s really stood out me is the general lack of understanding people have for the underlying biochemistry of these medicines. Additionally, people don’t seem to realise that biopharma is a very cyclical industry, but that cycle lasts for between ten and twenty year, coincidentally the lifetime of the average patent. If anyone has lost money investing in Novo Nordisk over the past year (or beyond) I really hope you’ve learnt something from the ordeal: stick to your competency. For me, that’s biopharma and I rarely touch anything else unless I have some sort of understanding about it. I understand the argument for investing as a generalist, but I think that primarily applies to simple industries like retail, or even some industrial or media-based industries.
If anyone has any counter, I’m happy to debate. Equally if people want a chat about biopharma or whatever, I’m always happy to have one haha