Novo Nordisk says insulin prices are expected to remain under pressure in 2020
- Novo Nordisk says insulin prices are expected to remain under pressure in 2020.
- Nordisk expects 1-5% growth in operating profit and 3-6% growth in sales in 2020.
- Nordisk missed the analysts' estimate for operating profit in Q4 but beat on the sales front.
- At the current 435 crowns per share, Nordisk posted a record high in the stock market.
Danish multinational pharmaceutical company known for its diabetes drug, Novo Nordisk, announced on Wednesday that 2020 is likely to see slower growth in its business as compared to the previous year. The company also stated that the prices for Insulin in the United States are expected to keep under pressure this year.
Nordisk has a reputation for being the top manufacturer of diabetes drugs across the globe. Owing to the recent rise in the costs of pharmaceutical products in the U.S that has not been well-received by the lawmakers, along with sharply increasing competition from other drugmakers in the niche of Insulin, Nordisk is committed to introducing novel yet innovative treatments that are likely to help it counter the pricing pressure as well.
Novo Nordisk Expects 3% To 6% Growth In Sales In 2020
The company also highlighted that fiscal 2020 is anticipated to see a 1% to 5% growth in its operating profit while sales are expected to rise by 3% to 6% this year (measured in local currency). In 2019, Nordisk boasted growth of 6% on both operating profit and sales fronts.
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Nordisk recently declared its launch of Rybelsus as successful in the U.S. Ozempic, Nordisk’s injectable treatment (once-weekly) already accounts for 50% of its total revenue. However, the lower prices for Insulin in the U.S led to largely flat sales in the aforementioned markets in 2019.
The pharmaceutical company, however, is confident that its novel drugs for diabetes type 2 in combination with obesity drugs will fuel its business growth in fiscal 2020. The new treatment for type 2 diabetes imitates the functionality of a natural hormone in the human intestine that serves to stimulate insulin production.
Novo Nordisk Missed Analysts’ Estimate For Operating Profit In The Fourth Quarter
In 2019’s fourth quarter, Nordisk recorded 11.9 billion Danish crowns in operating profit versus the analysts’ estimate of 12.0 billion crowns. On the sales front, however, the company posted 32.4 billion crowns while the experts had forecast it to make 31.9 billion crowns of sales in the recent quarter.
Following the announcement on Wednesday, Nordisk was reported trading 0.5% higher versus the Copenhagen market that remained flat at large. Closing the last year at 390 crowns, Nordisk gained around 30% in the stock market in 2019. Currently exchanging hands at 435 crowns per share, the stock marks a record high since it’s initial public offering (IPO).