Why Novo Nordisk Stock Is Soaring Today

Shares of Novo Nordisk (NYSE: NVO) are up on Tuesday. The company's stock gained 3.9% as of 2:40 p.m. ET today and was up as much as 4.5% earlier in the day. The move up comes as the S&P 500 and the Nasdaq Composite each rose 0.7%.

The pharma giant reached a deal with telehealth providers to offer its blockbuster GLP-1 drug Wegovy through their platforms.

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Novo Nordisk will partner with digital providers

Novo Nordisk announced its decision to partner with digital health providers to streamline access to Wegovy after a U.S. shortage has eased. And Novo will offer direct-to-consumer access via its NovoCare online pharmacy, where customers can buy it at a discounted price of $499 per month.

Betting on convenience

This is an effort to capture a large number of consumers who flocked to telehealth platforms to access compounded versions -- essentially generics made by third parties -- after a shortage allowed the platforms to do so. By partnering with well-known telehealth companies, Novo Nordisk is aiming to reclaim market share and build patient loyalty, even if it likely means slimmer margins on what it sells through them.

Dave Moore, executive vice president of U.S. operations at Novo Nordisk, told reporters that "We felt it was really important to work hard to establish a collaboration with telehealth companies" in order to "sort of catch people as they come off of compounded medicines."

Trade tensions could hurt the company's bottom line

I think this is a smart move that will allow the company to better compete in the uber-lucrative GLP-1 space. It shows the company can adapt, meeting customers where they are.

However, it is facing increasing competition from its rivals, and the ongoing trade war could impact the company's margins. I would hold off for now until trade tensions are resolved or more clarity emerges.

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Johnny Rice has no position in any of the stocks mentioned. The Motley Fool recommends Novo Nordisk. The Motley Fool has a disclosure policy.