Advertisement
New Zealand markets closed

  • NZX 50

    11,946.43
    +143.15 (+1.21%)
     

  • NZD/USD

    0.5966
    +0.0029 (+0.48%)
     

  • NZD/EUR

    0.5555
    +0.0009 (+0.16%)
     

  • ALL ORDS

    7,937.50
    -0.40 (-0.01%)
     

  • ASX 200

    7,683.00
    -0.50 (-0.01%)
     

  • OIL

    83.03
    +0.22 (+0.27%)
     

  • GOLD

    2,340.20
    +1.80 (+0.08%)
     

  • NASDAQ

    17,526.80
    +55.33 (+0.32%)
     

  • FTSE

    8,092.07
    +51.69 (+0.64%)
     

  • Dow Jones

    38,460.92
    -42.77 (-0.11%)
     

  • DAX

    18,002.51
    -86.19 (-0.48%)
     

  • Hang Seng

    17,284.54
    +83.27 (+0.48%)
     

  • NIKKEI 225

    37,628.48
    -831.60 (-2.16%)
     

  • NZD/JPY

    92.8140
    +0.6990 (+0.76%)
     

Novo Nordisk (NVO) Faces Pricing Pressure and Competition

Zacks Equity Research
Updated
Novo Nordisk (NVO) faces pricing pressures and intense competition in the Diabetes market.

We issued an updated report on Novo Nordisk A/S NVO on Oct 16.

Novo Nordisk’s continued growth from Victoza and Tresiba as well as higher contributions from Saxenda and Xultophy are likely to be partly offset by the impact of lower realized prices in the Unites States, loss of exclusivity of products in hormone replacement therapy, and intensifying competition within the diabetes and biopharmaceuticals markets, besides macroeconomic conditions in many markets under International Operations.

Last month, Novo Nordisk announced plans to restructure its Research & Development (R&D) organization. Consequently, the company will lay off 400 employees from R&D roles in Denmark and China. The company is taking this step to focus on both core and new therapy areas. The company aims to speed up the expansion and diversification of its pipeline across serious chronic diseases.

The company will re-allocate and restructure resources to bring novel candidates. To ensure this, it will identify new therapeutic approaches based on external collaborations, which Novo Nordisk will accelerate via the establishment of a new Business Development unit in Cambridge, MA.

ADVERTISEMENT

The company had also taken a similar step in 2016 to combat the challenging environment. Novo Nordisk had announced 1,000 job cuts to reduce operating costs, as the company was facing a challenging competitive environment.

The company also faces intense competition in the diabetes market, which is already crowded with a number of drugs. Merck and Co.’s MRK Januvia and Janumet (type II diabetes), Eli Lilly’s LLY Trulicity (type II diabetes), Sanofi’s  SNY Toujeo (type I and II diabetes) are already approved.  However, Victoza is slated to lose patent protection in the United States and the EU in 2023.

However, Novo Nordisk has a strong presence in the diabetes care market, with a global value market share of 27%. Novo Nordisk’s top line is driven by strong performance of products like Victoza (liraglutide). The company plans to submit the results from the Ellipse trial to the FDA in the United States and the EMA in the EU in fourth-quarter 2018, seeking a label expansion and six months patent extension of Victoza related to the pediatric data in the United States and the EU.

Wall Street’s Next Amazon

Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.

Click for details >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Sanofi (SNY) : Free Stock Analysis Report
 
Eli Lilly and Company (LLY) : Free Stock Analysis Report
 
Merck & Co., Inc. (MRK) : Free Stock Analysis Report
 
Novo Nordisk A/S (NVO) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research