Novo Nordisk says insulin prices are expected to remain under pressure in 2020

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.

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).