The logos of Danish drugmaker Novo Nordisk, maker of the blockbuster diabetes and weight-loss therapies Ozempic and Wegovy is pictured as the corporate offered the annual report at Novo Nordisk in Bagsvaerd, Denmark, on February 5, 2025. (Photograph by MADS CLAUS RASMUSSEN/Ritzau Scanpix/AFP by way of Getty Pictures)
Mads Claus Rasmussen | Afp | Getty Pictures
A management shakeup at what was as soon as Europe’s most precious firm is more likely to be cemented Friday as Novo Nordisk‘s controlling shareholder tightens it is grip on the weight-loss drugmaker, whilst minority shareholders categorical discontent.
Novo has discovered itself in an more and more chaotic scenario as of late, with shares plunging and investor confidence waning, as its position because the main participant within the extremely profitable weight-loss area is being known as into query.
The maker of diabetes and weight-loss medicine final month introduced an Extraordinary Common Assembly for Nov. 14 to exchange its unbiased board members, together with Chair Helge Lund, after it grew to become not possible to succeed in an settlement between the views of the present board and the Novo Nordisk basis board — the corporate’s majority shareholder.
Norges Financial institution Funding Administration (NBIM), one of many bigger minority shareholders, stated earlier this week it could abstain from voting at Friday’s EGM, indicating discontent. Different shareholders, equivalent to California State Academics’ Retirement System, have additionally stated they will vote in opposition to the proposal. NBIM and CalSTRS each declined to remark additional.
Lund might be changed by firm veteran Lars Rebien Sørensen, already chair of the Basis board. The 71-year-old additionally served as Novo Nordisk CEO between 2000 and 2016.
The inspiration additionally proposed Cees de Jong to grow to be vice chair and Mikael Dolsten, Britt Meelby Jensen and Stephan Engels to grow to be members.
Early Friday, Novo stated Dolsten, previously head of R&D at Pfizer, had determined to withdraw his candidacy to the board on account of private circumstances. Novo shares have been down 1.8% to $312.90 in morning buying and selling.
“It’s uncommon that an organization of that scale to make that diploma of change that shortly,” Andrew Pettigrew, Emeritus professor at College of Oxford, and an professional of theories of change, advised CNBC.
“It is normally precipitated by some terrible disaster, which is throwing them off a cliff, however most likely additionally a interval once they have been blind to what was happening beneath them. In different phrases, they have been shocked by a sudden change, and it normally takes that to overthrow an current energy group in an organization, particularly if they have been in energy for a very long time,” Pettigrew added.
The present board was “too sluggish in recognizing the importance of the market adjustments in the USA,” Sørensen advised analysts at a name following the announcement, including that two extra members could be introduced in the end.
Novo is broadly considered as having fallen behind U.S. peer Eli Lilly which has quickly taken market share from Novo, as its rival medicine Mounjaro and Zepbound have proven extra pronounced weight reduction on the highest dose.
“It is a matter of urgency and scope,” Sørensen stated in October concerning the proposed adjustments to the board, nevertheless additionally saying the muse is “absolutely aligned” behind Novo’s present technique underneath new CEO Mike Doustdar.
A difficult U.S. market
One other rationale for the board cull is {that a} new configuration would convey in additional folks with direct expertise from a U.S. client perspective to assist navigate the difficult market. It comes amid growing competitors each from Eli Lilly and so-called compounding pharmacies that make cheaper copycat model of the medicine, and a shift in the direction of direct-to-consumer gross sales.
Like for a lot of pharmaceutical corporations, the U.S. is Novo’s largest market. Within the first 9 months of 2025, the U.S. market accounted for 56% of whole gross sales, measured in Danish kroner.
Analysts, nevertheless, have expressed scepticism that the brand new board will convey within the supposed expertise. “On steadiness, it may appear the brand new board truly possesses much less slightly than extra industrial, giant pharma experience,” Deutsche Financial institution analyst Emmanuel Papadakis stated.
Novo shares have fallen 12% for the reason that board shakeup was introduced and have misplaced 58% for the reason that begin of this 12 months. Final week, the corporate reported third-quarter outcomes that missed estimates, and lowered the higher vary of its full-year steering citing slower development expectations for Ozempic and Wegovy.
It is however one in every of many dramatic happenings going down on the Danish pharma big currently.
“There have been so many strikes this 12 months that present Novo as a conflicted firm,” famous Morningstar analyst Karen Andersen. “With such a brand new direct-to-patient market rising as a essential piece of future weight problems drug gross sales development, and compounders remaining an actual competitor out there, it is not arduous to think about that the boards and administration may not have the identical imaginative and prescient for a way Novo ought to reply,” she added.
Over the weekend, Novo pulled out from a dramatic bidding conflict in opposition to U.S. big Pfizer over an experimental weight-loss drug by clinical-stage biotech Metsera, stepping away from a deal analysts have described as uncommon.
The board adjustments come simply months after Novo appointed Doustdar as chief government, booting former CEO Lars Fruergaard Jørgensen, partly blaming him for the present trajectory of the corporate and its shares. Doustdar has since introduced a reorganisation, together with shedding over 10% of workers globally.
