novonordisk

Novo Nordisk to cut 2% of its entire workforce

pharmafile | September 29, 2016 | News story | Business Services, Manufacturing and Production, Medical Communications, Research and Development, Sales and Marketing Denmark, Novo Nordisk, diabetes, insulin, job cuts, job losses 

Novo Nordisk, headquartered in Bagsvaerd, Denmark, has taken the decision to lose 1,000 of its workforce from a total global workforce of 42,300. Novo released a statement suggesting that the cuts will predominately take place in R&D and headquarter staff functions, as well as wider positions within the global commercial organisation.

The situation has arisen from a competitive US market, which Novo relies upon for about half of its revenue. Novo is the world’s biggest supplier of insulin and is now struggling in the US market as cheaper copycat medicines are causing it lose ground on its competitors whilst forcing them into a position to cut prices and therefore profit margins.

Chief Executive Lars Rebien Sorensen released a statement regarding the decision by stating that “We have concluded that it is needed in order for us to have a sustainable balance between income and costs”. It is estimated the cuts could save Novo anywhere from 700 million 1 billion crowns ($105-150 million), which would equate to 2-3 percent of next year’s earnings before interest and tax.

This is one significant change to the company that follows on the back of the announcement four weeks ago that CEO Sorensen would step down in January to be succeeded by Lars Fruergaard Jorgensen, who is currently executive vice president and head of corporate development.

Ben Hargreaves

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