Novo Nordisk trims 2016 profit forecast, hit by tough US market
Novo Nordisk lowered 2016 and 2017 forecasts on Friday citing a challenging U.S. market, sending shares in the world's largest insulin maker as much as 19 percent lower.
The Danish firm generates about half of its revenue in the U.S. market, where competition among insulin producers has increased and prices have been squeezed by pharmacy benefit managers who administer drug programs for employers and health plans.
"The market environment in the USA has become significantly more challenging, negatively impacting future pricing for Novo Nordisk's products," the company said in the statement.
Novo Nordisk lowered its 2016 operating profit growth forecast to 5-7 percent from 5-8 percent in local currencies. It expects sales growth of 5-6 percent, down from the 5-7 percent it earlier forecast.
For 2017 Novo Nordisk lowered its operating profit growth forecast to 5 percent from 10 percent.
Shares in Novo were down 15 percent as of 0713 GMT having been as much as 19 percent down. Reuters also reported that around $14 billion had been wiped off its market value.
Competition in the U.S. market in September prompted the company to announce to cut 1,000 jobs out of a global workforce of 42,300.
Long-time chief executive Lars Rebien Sorensen in September announced he would step down by the end of the year in what was widely seen as part of a change of strategy.
For the third quarter, Novo Nordisk reported an operating profit of 12.42 billion Danish crowns ($1.82 billion), in line with analysts' expectations. Revenue rose 4 percent to 27.54 billion Danish crowns, slightly below the 27.95 billion estimated by analysts.