Novo hikes forecast on 62% jump in Victoza sales

Novo Nordisk ($NVO) is still going gangbusters. The Danish drugmaker hiked its earnings guidance for the year as it unveiled a 40% increase in core profits for the first 9 months, aided by a whopping 62% increase in sales of its diabetes drug Victoza. Overall sales increase? 18%.

But the full-speed-ahead growth may not last, the company warns. Next year's growth depends on Tresiba, Novo's new ultra-long-acting insulin and a putative competitor for Sanofi's ($SNY) dominant product Lantus. And Tresiba's future is suddenly in doubt, now that an FDA panel disclosed that it would zero in on heart safety while reviewing the drug. It's up for discussion at an FDA Advisory Committee meeting Nov. 8.

So, after boosting expectations for 2012 sales growth to 10-12% from 9-12% (in local currencies) and profits growth of 16-18%, compared with a previous 15%, Novo said it expects single-digit growth next year. And Tresiba is key to both: It's expected to be a "positive sales contribution," but the "significant costs" of its launch will eat into profits.

Analysts didn't love the sales forecast, but Novo officials said uncertainty breeds caution. "The impact of [Tresiba] on the key U.S. market is very very hard to predict, and our growth outlook had to take that into consideration," CFO Jesper Brandgaard said at a news briefing (as quoted by Reuters). "We are leaving ourselves flexibility."

Tresiba, also known as degludec, recently won approval in Japan, and a European regulatory committee recommended it for clearance in the EU, along with a sister product Ryzodeg, which combines degludec with insulin aspart, sold under the brand names NovoLog and NovoRapid. In the U.S., the advisory panel is expected to weigh those cardiovascular risks against Tresiba and Ryzodeg's lower risk of hypoglycemia, the company said.

Meanwhile, Novo's other diabetes drugs are pumping up sales. The "modern insulins"--including NovoRapid and Levemir--grew by 21%, or 14% in local currencies, racking up 25.359 billion kronor, or $4.42 billion, for the period. And Victoza's big growth--74% on a reported basis--pushed it to 6.786 billion kronor, or $1.18 billion. The GLP-1 drug, which competes with Amylin Pharmaceuticals' Byetta and Bydureon, now has 66% of that market, up from 53% last year.

- read the Novo release
- see the Reuters news

Special Report: Tresiba - Top diabetes drug pipelines of 2012