Novo Nordisk, the renowned Danish pharmaceutical company, has revealed plans to significantly reduce costs after issuing a profit warning, following a sharp decline in its stock market value. The company, which has seen tremendous growth thanks to its popular weight-loss drugs like Wegovy and Ozempic, now faces increasing competition from similar products and market challenges. The G.Business website reports with reference to the Нandelsblatt.
Novo Nordisk’s market value dropped by approximately $95 billion last week, a staggering loss following the profit warning. The company’s stock has seen a significant drop, though on Wednesday, it gained 2.4% on the Tradegate exchange, signaling a slight recovery. However, the damage has already been done, with analysts expressing concern over the company’s future performance amid rising competition from other pharmaceutical companies producing similar weight-loss treatments.
Lars Fruergaard Jørgensen, the CEO of Novo Nordisk, confirmed that the company is taking immediate steps to optimize operations and strengthen its cost-control measures. He stated on Wednesday: "We are implementing strategies to sharpen our commercial focus and ensure the efficiency of our cost base moving forward."
The company has also reduced its sales growth forecast for the full year of 2025. Novo Nordisk now predicts a modest increase in sales of just 8–14%, a sharp drop from the previously forecasted range of 13–21%. Similarly, the forecast for operating profit growth has been revised down from a range of 16–24% to just 10–16%. These revised projections reflect the heightened market competition and the broader economic challenges the company is now facing.
In Q2 2025, Novo Nordisk, which was once Europe’s most valuable company, reported a sales increase of 18%, bringing total revenue to DKK 76.86 billion ($10.2 billion). However, this growth did not meet analysts' expectations, raising concerns over its ability to maintain previous levels of market dominance. The company’s operating profit (EBIT) increased by 29%, totaling DKK 33.45 billion ($4.5 billion), but even that did not live up to market expectations.
Novo Nordisk’s primary focus has been its line of diabetes and weight-loss drugs, which continue to perform well in many markets. However, competition in the pharmaceutical industry, particularly in the weight-loss sector, has ramped up with cheaper alternatives entering the market, resulting in tighter margins for Novo Nordisk. The company is now forced to rethink its strategy to adapt to a more competitive and economically uncertain environment.
As part of its restructuring, Novo Nordisk plans to concentrate its resources more effectively on its core products, focusing on maintaining its competitive edge in a shifting pharmaceutical landscape. Despite the challenges, Novo Nordisk remains committed to strengthening its position in global markets, aiming for long-term stability while navigating these tumultuous times.
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