Novo Nordisk takes out the ax and aims at R&D, chopping 1,000 jobs
The diabetes market is a tough, competitive field dominated by a few major players. And today one of the most prominent in the bunch, Novo Nordisk, says it will carve into its R&D organization as it slashes 1,000 jobs in an effort designed to pare expenses.
Outside of R&D Novo plans to trim headquarters staff and some commercial groups as well. Altogether it will cut 2% of its workforce. Half of those cuts are being made in Denmark with the ax falling on staffers between now and the end of November.
In an interview with Bloomberg, CEO Lars Rebien Sørensen added that the company will take a hard look at its research pipeline and make some tough choices on which drugs will stay in the portfolio.
“The next line of products have to have an even greater height of innovation, which means those that do not have that height of innovation will have to be culled,’’ Sørensen told the news service. “Otherwise, it’s going to be difficult for us to get reimbursement for our drugs. Me-too or me-better drugs will not be good enough in the future and hence we need to prioritize.”
Novo Nordisk’s move follows Sanofi’s struggles on the same diabetes front. An enormous and growing global market, these companies compete to field closely matched therapies, often racing each other with the latest tech that helps improve cardio outcomes or ease dosing schedules.
That approach has led to considerable progress in recent years, but there’s also been plenty of head-to-head pricing competition as older blockbusters go generic.
Said Sørensen in a statement:
“(W)e have concluded that it is needed in order for us to have a sustainable balance between income and costs. In the current situation, we have to prioritise investments in key product launches that will bring innovation to patients and drive our future growth.”