The maker of weight loss drugs Ozempic and Wegovy, Novo Nordisk, announced that it will be cutting its workforce amid stiff competition from United States rival Eli Lilly.
In a statement, the Danish company said it intends to reduce its global workforce by around 9,000, with 5,000 of these reductions expected in Denmark.
Novo Nordisk President and CEO Mike Doustdar said the move is to keep in line with the ever-evolving market of obesity and diabetes products.
“Our company must evolve as well,” he said.
“This means instilling an increased performance-based culture, deploying our resources ever more effectively, and prioritising investment where it will have the most impact – behind our leading therapy areas.”
The company said the workforce reduction is expected to deliver annualised savings of around DKK 8 billion (A$1.8 billion) by the end of 2026.
The savings will be redirected to growth opportunities, with the reductions to begin within the next few months.
Doustdar said while it is sad to see talent go, the company believes it is the right decision for the long-term success of Novo Nordisk.
“Our transformation plan is designed to deliver this,” he said.
“By realigning our resources now, we will be able to prioritise investments to drive sustainable growth and future innovation for the millions of patients with chronic diseases globally, particularly in diabetes and obesity.”
While the company is hoping the restructuring will lead to long-term improvements, they have shifted its 2025 full-year outlook for operating profit growth at CER from 10-16% to 4-10%.
This comes as its competitor, Eli Lilly said it will hike up prices of its weight loss drug Mounjaro in the UK as it tries to bring down prices in the U.S. amid pressure from the Trump administration.
At the time of writing, Novo Nordisk (CPH: NOVO-B) stocks were up 3.68% to DKK 351.15. The company has a market capitalisation of DKK 1.15 trillion.
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