Novo Nordisk's sales, profit top expectations in Q3

Headline results for the third quarter:

  • Revenue: DKK 35.6 billion ($5.5 billion; forecasts of DKK 34.6 billion), up 15%
  • Profit: DKK 12.1 billion ($1.9 billion; forecasts of DKK 11.5 billion), up 18%

Note: All changes are versus the prior-year period unless otherwise stated

What the company said:

"We are very pleased with the sales growth in the first nine months of 2021, which has enabled us to raise our outlook for the full year," remarked CEO Lars Fruergaard Jørgensen, adding that "growth is driven by all geographical areas and by all therapy areas, in particular by accelerated growth of our portfolio of GLP-1 treatments for diabetes and obesity."

The executive noted that "in the US, the initial demand for Wegovy has significantly exceeded our expectations." The once-weekly GLP-1 receptor agonist was approved by the FDA in June as an adjunct for chronic weight management in adults with a body mass index (BMI) of ≥30, or those with a BMI ≥27 plus at least one weight-related comorbidity.

Novo Nordisk has struggled to meet demand for Wegovy, noting that "patients may temporarily experience a delay in getting prescriptions filled." The company said it "is gradually increasing supply and expects to be able to meet demand in early 2022, depending on the demand." For related analysis, see ViewPoints: Early adoption trends suggest Novo Nordisk has unlocked US obesity market.

Other results:   

  • Diabetes segment: DKK 28.7 billion ($4.5 billion), up 15%
    • Ozempic: DKK 8.9 billion ($1.4 billion), up 66% on a constant exchange rate (CER) basis
    • Victoza: DKK 3.6 billion ($561 million), down 24% on a CER basis, as the GLP-1 market moves towards once-weekly and tablet-based treatments
    • Tresiba: DKK 2.4 billion ($374 million), up 16% on a CER basis
    • Rybelsus: DKK 1.3 billion ($203 million), up 204% on a CER basis, driven by North America, EMEA and the Rest of World markets, with the product now launched in 23 countries
    • Levemir: DKK 1.3 billion ($203 million), down 4% on a CER basis
  • Obesity care segment: DKK 2.4 billion ($374 million), up 79%, with the company now holding a value market share of 85.4% of the obesity prescription drug market in North America through Saxenda and Wegovy
  • Biopharmaceuticals: DKK 4.5 billion ($701 million), down 2%
    • NovoSeven: DKK 1.7 billion ($265 million), flat versus the prior year

Looking ahead:

As disclosed on October 29, Novo Nordisk now expects both sales and operating profit to grow this year between 12% and 15% at CER, boosted by higher-than-expected Ozempic market share gains, GLP-1 market growth and obesity care sales, mainly in the US. The company previously guided for revenues to grow between 10% and 13% on a CER basis, with operating profit forecast to rise by 9% to 12% at CER.

What analysts said:

Third Bridge analyst Sebastian Skeet noted that despite the third-quarter results and increased guidance, "pressures are building" on Novo Nordisk. "The looming threat to Novo's Chinese insulin franchise, that is the volume-based procurement programme…in China has been deferred into [the first half of 2022], undoubtedly giving Novo additional confidence in upgrading its [fiscal 2021] guidance. "

Skeet added that the manufacturing ramp-up for Wegovy continues to be a major focus for investors, but "given the sheer size of the potential patient pool, questions remain as to payer's appetite to cover this drug in a far broader set of patients." The analyst also suggested that if approved, Eli Lilly's diabetes drug candidate tirzepatide, which has also demonstrated significant weight loss in clinical trials, and was recently submitted to US and EU regulators, "could eat into Wegovy's potential."

Meanwhile, Skeet noted that Rybelsus "has seemingly yet to realise the expected inflection in uptake despite a ramp-up in promotional efforts." He added that "the wider GLP-1 class as a whole [faces] further pressures from SGLT2s, which, coupled with a lower price tag and oral formulation, have demonstrated impressive benefits in heart and kidney disease."

To read more Top Story articles, click here.