This quarter, we’ve had several drugmakers cite one-time reasons why particular drugs suffered sales declines. Wednesday, Novo Nordisk execs pointed to one-time drivers, too—but to partially explain why sales went up.
The Danish drugmaker beat estimates for revenue and operating profits—the latter by 11%—a result that had investors, who’d been disappointed by previous guidance cuts, bidding up shares Wednesday. But management “tempered enthusiasm” during the company’s earnings call, Bernstein analyst Ronny Gal said in a Wednesday note: Inventory-building gave some oomph to first-quarter sales, and that’s an effect likely to reverse itself, execs said.
“Thus solid quarter but not trend-changing,” Bernstein analyst Ronny Gal said in a Wednesday note.
Novo had enough to brag about, including Street-beating sales of its GLP-1 diabetes drug Victoza, which brought in 5.8 billion kroner, or $843 million, up 25%. Its fast-acting insulin NovoLog/NovoRapid also beat expectations with 5.3 billion kroner in sales.
In a presentation to analysts, the company said growth in the GLP-1 market—which has spiked from around 3% growth in February 2014 to 30% in February of this year—has been offsetting competition with Eli Lilly’s Trulicity (dulaglutide), which continues to shave off Victoza market share.
Then there was a whopping 174% increase in sales of Tresiba, its longer-acting basal insulin, which launched in the U.S. last year amid lots of payer pressure and has since faced more competition from new products, including Eli Lilly and Boehringer Ingelheim’s biosimilar version of Sanofi’s dominant Lantus.
The medication now has 12% share of new-to-brand prescriptions and 7% overall, Novo said. A new deal with pharmacy benefits manager CVS Health helped with those gains. (Analysts had expected more than 1.4 billion kroner in sales that Tresiba delivered, however.)
Overall, the Danish drugmaker put up a first-quarter sales hike of 5% to 28.5 billion Danish kroner, and an even bigger profits increase of 7% to 10.2 billion kroner, with the former fueled by newer products and the latter, lower costs.