COPENHAGEN: Novo Nordisk, the world’s top maker of diabetes drugs, on Wednesday reported second-quarter operating profit broadly in line with forecasts, but said prices in the key U.S. market would be lower next year.
The drug maker said that subject to the final outcome of negotiations with pharmacy benefit managers (PBM) and managed care organizations in the United States, “average prices after rebates are expected to be lower compared with the levels in 2018.”
This was mainly due to the pricing of basal insulins and changed legislation, it said, adding that the market access for its key products is expected to remain broadly unchanged compared to 2018.
Novo relies on the United States for about half of its total revenue and it needs to stay on the PBM lists, as these account for around 80 percent of U.S. drug sales.
Drug manufacturers face new U.S. legislation aimed at reining in high drug prices. Novo Nordisk said in May that the new rules would cut its 2019 sales by 1-2 percent but kept its long-term operating growth forecast of 5 percent.
The company reported second-quarter operating profit of 12.2 billion Danish crowns, slightly below an average 12.3 billion crowns forecast in a Reuters poll of analysts.
Novo kept its 2018 outlook for sales growth of 3-5 percent and operating profit growth of 2-5 percent, both measured in local currencies.
But sales and operating profit growth in Danish kroner are now expected to be 5 and 7 percentage points lower than the level in local currency, respectively, compared to a previous guidance of 6 and 9 percentage points.
(Reporting by Stine Jacobsen; Editing by Jacob Gronholt-Pedersen and Jane Merriman)