Novo Nordisk ( NVO ) reported its newest GLP-1 product, CagriSema, provides an average of 22.7% weight loss, but that wasn't enough to convince investors, sparking a sell-off of the stock.

"We are encouraged by the weight loss profile of CagriSema. This was achieved even though only 57% of patients reached the highest CagriSema dose,” said Martin Holst Lange, executive vice president for development at Novo Nordisk, in a statement Friday.

The results came from a trial of nondiabetic adults with obesity. A second late-stage trial for diabetics is underway, with results expected in the first half of 2025.

Novo traded down more than 20% Friday morning, its biggest loss since 2002. The CagriSema news boosted competitors, such as Eli Lilly ( LLY ), whose stock bumped up more than 6%.

The results are significantly better than those of Novo's current GLP-1s, Ozempic for diabetes and Wegovy for weight loss, which provide around 15% weight loss. But Novo's management had been bullish on CagriSema, setting the bar at 25%.

"This is below the Street’s expectation of 25% and more comparable to the ~21% for Zepbound. It appears the protocol for the CagriSema trial included flexible dosing, and this led to only ~57% of patients reaching the highest dose of the product/contributed to the lower-than-expected avg weight loss," JPMorgan analysts wrote in a note to clients Friday.

The weight loss provided by CagriSema in Phase 3 trials beats current leading products for Novo but only slightly beats Lilly's GLP-1s, Mounjaro for diabetes and Zepbound for weight loss, which provide 21% weight loss on average — which is why investors aren't impressed.

"The data are well-below expectations given NVO mgmt.’s weight loss efficacy bar of 25%," Leerink Partners analyst David Risinger wrote in a note to clients Friday.

JPMorgan analysts also noted in a separate note Friday that Lilly's candidate, retatrutide, which is in late-stage trials, could further erode Novo's lead.

"While it’s possible that CagriSema can show higher weight loss in new studies that Novo is planning to run ... this study will take time to readout. As a result, we see the competitive bar mostly unchanged, at least in the near term (until LLY’s retatrutide ph3 data in 2026, which we think could show 25%-30% weight loss)," the analysts wrote.

In addition, Lilly's pill candidate is in the trial stage, further along than other competitors. If the drug, orforglipron, proves efficacious, it would further Lilly's lead in the weight-loss market.