After losing Ablynx NV to Sanofi, Novo Nordisk A/S is now shifting the focus on its biopharmaceuticals segment, starting with Jesper Brandgaard leaving his CFO post to be the executive vice president for biopharm and legal affairs.
In 2017, Novo's biopharmaceuticals sales fell by 18% to 18.8 billion Danish kroner, from 22.83 billion Danish kroner, a year earlier. The decline reflects the impact of generic competition for its hormone replacement therapy Vagifem in the U.S. and rebate adjustments for growth hormone in the first-quarter of 2016.
"We have as a clear objective to return to biopharm growth," Novo Nordisk President and CEO Lars Fruergaard Jørgensen said on the company's fourth-quarter 2017 earnings call.
The Danish drugmaker projects sales growth of 2% to 5% for 2018, but Brandgaard cautioned that diabetes care and biopharmaceuticals sales, particularly its hemophilia inhibitor sector, are likely to be negatively affected by intensifying global competition and continued pricing pressures in the U.S.
On future M&A plans
Even after failing to snatch Belgian biotech Ablynx, Novo Nordisk is not changing its M&A priorities.
The pharmaceutical giant is still looking to spend about $2 billion to $3 billion in acquisitions. If it decides to change the scale of the deals, Novo Nordisk will make sure that the transaction is going to bring additional value to shareholders, said Brandgaard.
Novo Nordisk intends to reduce the size of its new 14 billion Danish kroner share repurchase program if such opportunities arise in 2018, Brandgaard added. The company is also considering in-licensing opportunities with shared risk and rewards to further enhance its biopharmaceutical pipeline.
"So it was a little bit be dependent on the where is the actual target that we would like to supplement our biopharm pipeline. With that, will be determining whether it's going to be an actual acquisition or whether it's going to be in activity with a much lower capital, initial capital requirement," Brandgaard said on the call.
As of Jan. 31, US$1 was equivalent to 5.98 Danish kroner.
