"The layoffs come amid sluggish sales as competition heats up in the weight-loss drug market. Novo Nordisk, the maker of blockbuster weight loss medication Wegovy, will cut 9,000 jobs amid growing competition in the industry led by US rival Eli Lilly. The Danish pharmaceutical giant announced the cuts on Wednesday, marking the largest layoff in Denmark's history. The restructuring is slated to save the company 8 billion Danish crowns ($1.25bn) annually."
"This comes amid changes in the company's C-suite. Last month, Novo named Maziar Mike Doustdar as CEO to replace Lars Fruergaard Jorgensen. Once Europe's most valuable company by market capitalisation, Novo has seen its market cap fall to roughly $181bn from its peak last year of $650bn. At the time, Novo's market cap exceeded Denmark's annual gross domestic product. On Wednesday, the company issued its third profit warning this year."
"They need to reignite investor confidence with an appealing growth story for the future, said Novo Nordisk shareholder Lukas Leu, a portfolio manager at ATG Healthcare, to the Reuters news agency. The obesity market was misjudged. It's much more consumer-driven than anticipated, and Novo expanded organisational complexity too quickly. The Danish pharma giant's surge in growth began in 2021, when Wegovy was the first highly effective obesity drug to be approved in the United States."
Novo Nordisk will cut 9,000 jobs, about 11.5% of its workforce, with at least 5,000 layoffs in Denmark, aiming to save 8 billion Danish crowns ($1.25bn) annually. The cuts follow sluggish sales of Wegovy and intensifying competition from rivals, notably Eli Lilly. The company named Maziar Mike Doustdar as CEO to replace Lars Fruergaard Jorgensen amid C-suite changes. Novo's market capitalization has fallen from roughly $650bn to about $181bn, and the company issued its third profit warning this year. Rapid expansion since Wegovy's 2021 US approval nearly doubled headcount and increased organisational complexity. A hiring freeze on non-essential roles was already announced.
Read at www.aljazeera.com
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