Novo Nordisk shares slipped Thursday after Deutsche Bank downgraded the stock's rating on concerns over the company's future growth potential.

Shares were 3.3% lower in afternoon Copenhagen trade after Deutsche Bank downgraded the stock to sell from hold and lowered its target price to 265 Danish kroner ($41.32) from 290 kroner.

The stock has tumbled 70% since its June 2024 peak, as the drugmaker has contended with intensifying competition from rival Eli Lilly as well as knockoff versions of its blockbuster Ozempic diabetes and Wegovy weight-loss jabs.

Pricing pressure has also dented sentiment, especially in the U.S. following a Trump administration deal to lower drug prices in return for expanded coverage of weight-loss drugs in federal health programs.

As part of plans to reduce its reliance on the core obesity and diabetes franchises, the company is working to broaden its drug offering to include more treatments for related diseases. But experimental drug Ziltivekimab disappointed investors last month after it failed to reduce risk of heart attack or stroke in a late-stage clinical trial, sending shares down over 7% on the day.

In a note to clients Thursday, Deutsche Bank analyst Emmanuel Papadakis said he had cut his mid-term revenue estimates as Ziltivekimab is now effectively out of the picture and that he expects any sales bump of weight-loss drugs from U.S. health insurance program Medicare to be limited.

Papadakis also noted continuing concerns over the scope for a return to growth in 2027 and a large patent expiry problem further out.

Novo Nordisk announced Thursday that an application to sell its Wegovy weight-loss pill was accepted by Chinese regulators. The Wegovy pill has received regulatory approvals in markets including the U.S., the U.K., the United Arab Emirates, Bahrain and the European Union.

Novo Nordisk has a key investor update planned for next month, and Richard Vosser at J.P.Morgan said earlier this week that the Wall Street bank expects the event to focus on an overview of the pipeline, including updates on next-generation weight-loss and diabetes drugs as well as general strategy.