Flat revenue performance
In its 4Q17 earnings conference call, Novo Nordisk (NVO) has projected sales to be 2%–5% higher YoY (year-over-year) in 2018 in local currency. However, the company also anticipates a seven-percentage-point impact due to unfavorable currency fluctuations, which could impact its revenue growth rate. The company accounts for 27% of the global diabetes care market and 46% of the global insulin market.
Strategic priorities and core capabilities
According to the IDF’s (International Diabetes Federation) Diabetes Atlas Eighth Edition 2017, approximately 425 million people worldwide suffer from diabetes. A significant percentage of these patients are not yet diagnosed and do not have good glycemic control. By 2045, the number of diabetes patients worldwide is expected to rise to 629 million. In October 2017, the World Health Organization estimated that close to 650 million people worldwide are obese.
To benefit from this robust growth opportunity, Novo Nordisk is focused on strengthening its leadership in the diabetes care and obesity care segments. It is also aiming to strengthen its leadership in the growth disorder space and pursue leadership in the hemophilia space. The company hopes to expand its presence in the serious chronic disease, diabetes, and obesity spaces.
To achieve these strategic goals, Novo Nordisk aims to leverage its core capabilities—solid understanding of chronic disease, expertise in engineering and developing protein-based therapies, mass-scale manufacturing capabilities, and broad commercial reach. In the next article, we’ll discuss Novo Nordisk’s earnings growth prospects.