Novo Nordisk cuts jobs as profits slip

Novo Nordisk, the world's top manufacturer of insulin, announced Thursday it is cutting 1,300 jobs as part of a restructuring of its research and development operations.

Novo Nordisk cuts jobs as profits slip
Novo Nordisk's headquarters in Bagsværd. Photo: Liselotte Sabroe/Ritzau Scanpix
“The total workforce is expected to be reduced by approximately 1,300 employees before the end of 2018 and the majority of these reductions have been implemented as of 1 November 2018,” the Danish company said in a statement.
The costs related to the layoffs helped push down the company's earnings, with net profit sliding 8 percent year-on-year to 9 billion kroner (€1.2 billion, $1.4 billion) in the third quarter. Sales rose by 4.3 percent to 27.6 billion kroner.
The firm said the restructuring aimed “to accelerate the expansion and diversification of its pipeline and to enable increased investment in transformational biological and technological innovation.”
Novo Nordisk alone supplies nearly half of the insulin to diabetes sufferers across the globe.
Rising obesity has led to a surge in diabetes cases, but the costs of some of the new treatments have posed difficulties for the firm, particularly in the United States where some private insurers have balked at the price tags.
Novo Nordisk said its insulin sales fell by 8 percent in local currencies in North America in the first nine months of the year, noting lower prices due to rebates.


Novo Nordisk sees increased profits despite pandemic

Denmark's Novo Nordisk, the world's number one producer of insulin, on Wednesday reported an eight percent bump to net profits in 2020 despite the pandemic leading to a drop in new patients.

Novo Nordisk sees increased profits despite pandemic
Photo: Mads Claus Rasmussen/Ritzau Scanpix

In line with analysts' expectations, the company recorded an annual net profit of 42.1 billion Danish kroner (5.6 billion euros).

Revenue came in at 126.9 billion kroner, up four percent compared to a year earlier, not counting currency effects, driven by sales of GLP-1 products for treating diabetes.

According to Novo Nordisk, the company claimed 47.2 percent of the global market for insulin in November 2020, and 39.4 percent of the US market, which is the drugmaker's single largest market.

The International Diabetes Federation (IDF) estimates that there are over 425 million diabetics in the world, a number expected to top 629 million by 2045 as changing diets and lifestyles provoke the condition whereby the effectiveness of naturally produced insulin is reduced and people cannot convert sugar in their bloodstream for use as energy, causing health problems such as heart disease, vision loss and kidney disease.

However, only half of people with diabetes are currently diagnosed and of those only half are receiving treatment, according to the IDF, which says an estimated four million people die from the disease and the health complications it causes every year.

The Covid-19 pandemic cut into the number of people receiving help, according to Novo Nordisk.

“During the period of social distancing implemented in many markets, fewer new patients are initiating treatment,” said the company.

Novo Nordisk also develops and markets treatments for haemophilia and growth disorders, where sales fell by four percent and increased by six percent respectively, not counting currency effects.

Sales of its anti-obesity medicines, mainly Saxenda, increased by three percent.

In 2021, Novo Nordisk expects sales to grow by five to nine percent and operating profit to increase by four to eight percent.

In the early hours of trading on the Copenhagen stock exchange, shares in Novo Nordisk were up 4.6 percent.

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