(Bloomberg) -- Novo Nordisk A/S’s more than 350% rally over the past four years may have further to run if the weight-loss drug firm is to close the gap with its US competitor.

While analysts have cautioned that the stock’s valuation is getting ahead of itself, its 30% discount to Eli Lilly & Co. suggests otherwise.

The gap between the two looked set to widen further on Thursday, as fluctuating Novo shares fell as much as 3.6% before paring the drop.

Lilly and Novo have been locked in a battle to dominate the weight-loss drug market, with both trying to boost output as demand outstrips supply. Both firms’ quarterly results this week underlined their reliance on the success of medications such as Novo’s Wegovy and Lilly’s Zepbound. 

Read more: Novo Boosts Wegovy Supply as Lilly Rivalry Pressures Prices

Ramping up production is a key element of Novo’s strategy as it battles Lilly for supremacy in the sector. Improvements in supply could support better growth in the second half of the year, according to Bloomberg Intelligence. 

--With assistance from Blaise Robinson.

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