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Diabetes Care Market Expected to Offer Strong Growth for Novo Nordisk

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Diabetes care market

With a 46% share of the global insulin market, Novo Nordisk (NVO) is currently a leading player in the diabetes care segment. The company has geographically diversified presence and accounts for 37%, 46%, 47%, 55%, and 55%, of the insulin market in its US, Europe, Pacific, China, and International Operations geographies, respectively.

Novo Nordisk’s recent investor presentation explains diabetes as “chronic disease that occurs either when the pancreas does not produce enough insulin or when the body cannot effectively use the insulin it produces.” The presentation defines diabetes as “the inability to manage blood sugar levels appropriately.” Insulin therapy is used to treat diabetes and to recreate normal insulin levels in the body.

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Market opportunity

With diabetes becoming a global pandemic, Novo Nordisk is expected to witness strong double-digit revenue growth for its diabetes franchise. According to International Diabetes Federation’s Diabetes Atlas 7th Edition, 415 million people are currently affected by diabetes around the world. The global disease prevalence is expected to rise to 642 million by 2040. The majority of this rise in diabetes patients is expected to be seen in its International Operations geography, followed by China, the US, Europe, and the Pacific region.

According to Centers for Disease Control and Prevention’s Division of Diabetes Translation and National Diabetes Surveillance System, increasing obesity in the US has been the leading cause of higher diabetes prevalence in the country.

These statistics underline the scale of opportunity available for Novo Nordisk and other pharmaceutical companies such as Sanofi (SNY), Eli Lilly (LLY), and GlaxoSmithKline (GSK) in the diabetes care segment. Notably, the First Trust Value Line Dividend Index Fund (FVD) has about 0.49% of its total portfolio holdings in NVO.

In the next part, we’ll explore Novo Nordisk business strategy in 2016.

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