Novo Nordisk (NVO) reported an earnings miss Wednesday, sending its inventory down 4% in early buying and selling, pressuring the inventory additional after a shock administration shake-up earlier within the yr and sharply lowered steerage regardless of rising gross sales of its blockbuster GLP-1 medicine Ozempic and Wegovy.
The inventory is down greater than 46% yr to this point consequently.
CFO Karsten Munk Knudsen mentioned a number of the adjustments in current weeks. He advised Yahoo Finance that the management change — the ousting of CEO Lars Jørgensen and worldwide head Mike Doustdar taking his place — was a shock.
“I used to be stunned concerning the adjustments of CEOs again in Could,” Knudsen mentioned. “However … taking a look at different firms … when strain is on, when it comes to efficiency and competitors, then it is commonplace that bosses and house owners assess what’s the suitable crew to steer the corporate. In a macro setting I do not assume its extraordinary, however in a Novo setting it was certainly stunning.”
The US market has additionally confirmed a problem for Novo Nordisk, because it misplaced its lead regardless of a first-mover benefit to competitor Eli Lilly (LLY). Executives blame the compounding market, during which copycats are allowed below particular circumstances, with telehealth platforms benefiting from the loophole regardless of the FDA ending a scarcity of GLP-1s that beforehand allowed copycats to freely promote in the marketplace.
Knudsen mentioned the compounding market is about one-third of present GLP-1 prescriptions within the US market.
On prime of the competitors and copycats, Novo Nordisk, like different massive pharma names, has been focused by the Trump administration to decrease costs for shoppers. It was one in all 17 firms to obtain a letter demanding decrease prices for present and new merchandise.
“In actuality, we’re not that far aside within the sense that we additionally drive for inexpensive entry in merchandise that we provide. Our GLP-1 pricing is already fairly low,” Knudsen mentioned, with out revealing the precise numbers.
Outgoing CEO Lars Jørgensen mentioned on an earnings name Wednesday that its costs for Medicaid, for instance, are already decrease than in Europe. These costs aren’t publicly out there.
The letter additionally requested the businesses to cost new medicine on the similar low pricing present in different developed nations and to offer the decrease money costs extra broadly.
Some consultants have expressed doubt about money market success, nevertheless.
Craig Garthwaite, a professor of technique and healthcare at Northwestern College’s Kellogg Faculty of Administration, posted on X in response to the Trump letters, questioning the technique’s viability.
