Novo Nordisk’s shares jumped 7 per cent after the world’s biggest insulin maker announced a 7 per cent rise in net profits in the first quarter of 2017.
The Danish group said overall sales were up 5 per cent in Danish krone, its reporting currency, to DKr28.45bn. Net profit for the first three months of the year was DKr10.16bn, up from DKr9.46bn a year ago.
Higher sales in diabetes and obesity care offset a fall in its biopharmaceuticals division, which Novo Nordisk said suffered from the recent introduction of a generic version of one of its menopause treatments in the US and a knock-on effect from US rebate adjustments in the first quarter of last year.
The results are some good news for chief executive Lars Fruergaard Jørgensen, who joined in January following a management shake up. In February, the company’s shares fell 8 per cent in a day after it cut sales and profit forecasts for the fourth time in a year, citing political risks on drug pricing in the US, where Novo Nordisk makes nearly 40 per cent of its sales.
But the drugmaker has narrowed its outlook further, due to a smaller than expected currency boost. It now says it expects full year sales growth of up to 4 per cent, measured in Danish krone, compared to up to 6 per cent when it reported in February, and operating profit growth of up to 4 per cent, compared to up to 5 per cent in February.
Mr Fruergaard said: “With the performance in the first three months, we are well on track towards our targets for 2017. Sales were driven by our new, innovative products within diabetes and obesity care, and we are seeing the effects of our cost control initiatives, enabling us to invest in future growth opportunities.”
Shares were trading at DKr283.0 at publication time.