UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________
FORM 6-K
_________________________
REPORT OF FOREIGN PRIVATE ISSUER
Pursuant to rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934
May 2, 2018
_________________________
NOVO NORDISK A/S
(Exact name of Registrant as specified in its charter)
_________________________
Novo Allé
DK-2880 Bagsværd
Denmark
(Adress of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F
Form 20-F x Form 40-F o
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes o No x
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g-32(b):82-________
Financial report for the period 1 January 2018 to 31 March 2018
2 May 2018
Novo Nordisk's operating profit decreased by 8% in Danish kroner and
increased by 6% in local currencies in the first three months of 2018
Sales decreased by 5% in Danish kroner and increased by 5% in local currencies
Sales decreased by 5% in Danish kroner and increased by 5% in local currencies to DKK 26.9 billion.
• Sales of Victoza® increased by 4% to DKK 6.0 billion (18% in local currencies).
• Sales of Tresiba® increased by 18% to DKK 1.8 billion (33% in local currencies).
• Sales of Saxenda® increased by 43% to DKK 0.8 billion (64% in local currencies).
• Sales in North America Operations decreased by 11% (increased by 3% in local currencies).
• Sales in International Operations were unchanged (increased by 8% in local currencies).
Sales within diabetes care and obesity decreased by 5% to DKK 22.6 billion (increased by 6% in local currencies).
Sales within biopharmaceuticals decreased by 8% to DKK 4.3 billion (increased by 1% in local currencies).
Operating profit decreased by 8% reported in Danish kroner and increased by 6% in local currencies to DKK 12.4
billion, reflecting the significant depreciation of the US dollar and related currencies versus the Danish krone.
Net profit increased by 6% to DKK 10.8 billion. Diluted earnings per share increased by 8% to DKK 4.40.
In February, Novo Nordisk announced that the European Commission had granted marketing authorisation for
Ozempic® (subcutaneous semaglutide) for the treatment of adults with type 2 diabetes. In March, Novo Nordisk
announced that the Japanese Ministry of Health, Labour and Welfare had approved Ozempic®. Furthermore, in
February, Novo Nordisk launched Ozempic® in the USA following the approval in December 2017.
In February, Novo Nordisk successfully completed the first phase 3a trial, PIONEER 1, with oral semaglutide
for treatment of adults with type 2 diabetes. The trial achieved its primary objective by demonstrating statistically
significant and superior improvements in blood glucose levels (HbA1c) for all three doses of oral semaglutide
compared to placebo.
In March, Novo Nordisk announced that the US Food and Drug Administration had approved an update to the US
prescribing information for Tresiba® (insulin degludec) based on the DEVOTE trial to include data on cardiovascular
outcomes and severe hypoglycaemia in the label.
For 2018, sales growth is now expected to be 3-5% measured in local currencies compared with the prior guidance
of 2-5% and operating profit growth is now expected to be 2-5% compared with the prior guidance of 1-5%.
Sales growth and operating profit growth reported in Danish kroner are now expected to be 6 and 9 percentage
points lower than in local currencies, respectively.
Lars Fruergaard Jørgensen, president and CEO: “Based on the performance of our key products Victoza®, Tresiba®
and Saxenda®, we delivered solid underlying growth in both sales and operating profit in the first three months of
2018. We reached important milestones with our once-weekly GLP-1 Ozempic®, as we launched in the USA and
received approvals in both the EU and Japan. Moreover, we are encouraged by the first clinical results for oral
semaglutide from the PIONEER 1 trial.”
Novo Nordisk A/S Novo Allé Telephone: CVR Number:
Investor Relations 2880 Bagsværd +45 4444 8888 24 25 67 90
Denmark www.novonordisk.com
Company announcement No 37 / 2018
About Novo Nordisk
Novo Nordisk is a global healthcare company with 95 years of innovation and leadership in diabetes care. This
heritage has given us experience and capabilities that also enable us to help people defeat obesity, haemophilia,
growth disorders and other serious chronic diseases. Headquartered in Denmark, Novo Nordisk employs
approximately 42,700 people in 79 countries, and markets its products in more than 170 countries. Novo Nordisk’s
B shares are listed on Nasdaq Copenhagen (Novo-B). Its ADRs are listed on the New York Stock Exchange (NVO).
For more information, visit novonordisk.com, Facebook, Twitter, LinkedIn, YouTube.
Conference call details
On 2 May 2018 at 13.00 CEST, corresponding to 7.00 am EDT, a conference call will be held. Investors will be able
to listen in via a link on novonordisk.com, which can be found under ‘Investors’. Presentation material for the
conference call will be available approximately one hour before on the same page.
Webcast details
On 3 May 2018 at 14.15 CEST, corresponding to 8.15 am EDT, management will give a presentation to
institutional investors and sell-side analysts in London. A webcast of the presentation can be followed via a link on
novonordisk.com, which can be found under ‘Investors’. Presentation material for the webcast will be made
available on the same page.
Financial calendar
8 August 2018 Financial statement for first six months of 2018
1 November 2018 Financial statement for first nine months of 2018
1 February 2019 Financial statement for 2018
Contacts for further information
Media:
Katrine Sperling +45 3079 6718 krsp@novonordisk.com
Ken Inchausti (USA) +1 267 809 7552 kiau@novonordisk.com
Investors:
Peter Hugreffe Ankersen +45 3075 9085 phak@novonordisk.com
Anders Mikkelsen +45 3079 4461 armk@novonordisk.com
Christina Kjær +45 3079 3009 cnje@novonordisk.com
Further information about Novo Nordisk is available on novonordisk.com.
Financial report for the period 1 January 2018 to 31 March 2018 Page 2 of 29
Company announcement No 37 / 2018
LIST OF CONTENTS
FINANCIAL PERFORMANCE ............................................................................................................. 4
Consolidated financial statement for the first three months of 2017 ............................................ 4
Sales development ....................................................................................................................... 5
Diabetes care and obesity, sales development .............................................................................. 6
Biopharmaceuticals, sales development ........................................................................................ 9
Development in costs and operating profit ................................................................................... 9
Financial items (net) ..................................................................................................................... 10
Capital expenditure and free cash flow ........................................................................................ 10
OUTLOOK ....................................................................................................................................... 11
RESEARCH & DEVELOPMENT UPDATE ............................................................................................. 13
SUSTAINABILITY UPDATE ................................................................................................................ 16
EQUITY ........................................................................................................................................... 16
MANAGEMENT STATEMENT ........................................................................................................... 19
FINANCIAL INFORMATION ............................................................................................................... 20
Appendix 1: Quarterly numbers in DKK........................................................................................ 20
Appendix 2: Income statement and statement of other comprehensive income............................ 21
Appendix 3: Cash flow statement................................................................................................ 22
Appendix 4: Balance sheet........................................................................................................... 23
Appendix 5: Equity statement...................................................................................................... 24
Appendix 6: Regional sales split................................................................................................... 25
Appendix 7: Key currency assumptions........................................................................................ 26
Appendix 8: Quarterly numbers in USD (additional information)................................................... 27
Appendix 9: Non-IFRS financial measures (additional information)................................................ 28
Appendix 10: New accounting standards in 2018........................................................................ 29
Financial report for the period 1 January 2018 to 31 March 2018 Page 3 of 29
Financial
Performance Outlook R&D Sustainability Equity
Financial
Information
Company announcement No 37 / 2018
FINANCIAL PERFORMANCE
CONSOLIDATED FINANCIAL STATEMENT FOR THE FIRST THREE MONTHS OF 2018
These unaudited consolidated financial statements for the first three months of 2018 have been prepared in
accordance with IAS 34 ‘Interim Financial Reporting’. The accounting policies adopted in the preparation are
consistent with those applied in the Annual Report 2017 of Novo Nordisk, except for the adoption of new,
amended or revised standards and interpretations (‘IFRSs’) as published by the IASB that are endorsed by the EU and
effective as of 1 January 2018. This includes IFRS 9 'Financial Instruments' applied prospectively and IFRS 15
'Revenue from Contracts with Customers' applied on a modified retrospective basis, see appendix 10. Furthermore,
the financial report including the consolidated financial statements for the first three months of 2018 and
Management’s review have been prepared in accordance with additional Danish disclosure requirements for interim
reports of listed companies.
Amounts are in DKK million, except number of shares, earnings per share and full-time equivalent employees.
PROFIT AND LOSS Q1 2018 Q1 2017
% change
Q1 2017
to Q1 2018
DKK million
Net sales 26,930 28,452 (5%)
Gross profit 22,733 24,201 (6%)
Gross margin 84.4% 85.1%
Sales and distribution costs 6,451 6,787 (5%)
Percentage of sales 24.0% 23.9%
Research and development costs 3,321 3,289 1%
Percentage of sales 12.3% 11.6%
Administrative costs 864 913 (5%)
Percentage of sales 3.2% 3.2%
Other operating income, net 351 278 26%
Operating profit 12,448 13,490 (8%)
Operating margin 46.2% 47.4%
Financial items (net) 1,161 (486) N/A
Profit before income taxes 13,609 13,004 5%
Income taxes 2,858 2,848 0%
Effective tax rate 21.0% 21.9%
Net profit 10,751 10,156 6%
Net profit margin 39.9% 35.7%
OTHER KEY NUMBERS
Depreciation, amortisation and impairment losses 732 708 3%
Capital expenditure (tangible assets) 2,310 1,604 44%
Net cash generated from operating activities 9,815 12,098 (19%)
Free cash flow 7,241 10,400 (30%)
Total assets 93,558 94,213 (1%)
Equity 44,238 40,301 10%
Equity ratio 47.3% 42.8%
Average number of diluted shares outstanding (million) 2,442.3 2,500.0 (2%)
Diluted earnings per share / ADR (in DKK) 4.40 4.06 8%
Full-time equivalent employees end of period 42,688 41,636 3%
Financial report for the period 1 January 2018 to 31 March 2018 Page 4 of 29
Financial
Performance Outlook R&D Sustainability Equity
Financial
Information
Company announcement No 37 / 2018
SALES DEVELOPMENT
Sales decreased by 5% measured in Danish kroner and increased by 5% in local currencies, reflecting a significant
impact from the depreciation of the US dollar and related currencies versus the Danish krone. Sales growth was
realised within diabetes care and obesity with the majority of growth originating from Victoza®, Tresiba® and
Saxenda®, partly offset by declining sales of Levemir®. Sales growth within biopharmaceuticals was driven by
increased sales of NovoEight® and NovoSeven®, partly offset by Other biopharmaceuticals.
Sales split per therapy
Sales Q1 2018
DKK million
Sales Q1 2017
DKK million
Growth
as reported
Growth
in local
currencies
Share of
growth
in local
currencies
The diabetes care and obesity segment
Long-acting insulin 4,873 5,606 (13%) (3%) (10%)
- Tresiba® 1,755 1,491 18% 33% 33%
- Xultophy® 338 103 228% 246% 17%
- Levemir® 2,780 4,012 (31%) (22%) (60%)
Premix insulin 2,642 2,861 (8%) 1% 2%
- Ryzodeg® 141 95 48% 65% 4%
- NovoMix® 2,501 2,766 (10%) (1%) (2%)
Fast-acting insulin 4,778 5,317 (10%) 0% 0%
- Fiasp® 83 3 - - 6%
- NovoRapid® 4,695 5,314 (12%) (2%) (6%)
Human insulin 2,366 2,516 (6%) 3% 4%
Total insulin 14,659 16,300 (10%) 0% (4%)
Total GLP-1 6,058 5,750 5% 19% 73%
- Victoza® 5,989 5,750 4% 18% 68%
- Ozempic® 69 - - - 5%
Other diabetes care1) 1,121 1,172 (4%) 5% 4%
Total diabetes care 21,838 23,222 (6%) 5% 73%
Obesity (Saxenda®) 770 539 43% 64% 23%
Diabetes care and obesity total 22,608 23,761 (5%) 6% 96%
The biopharmaceuticals segment
Haemophilia2) 2,503 2,576 (3%) 7% 12%
- NovoSeven® 2,154 2,311 (7%) 3% 4%
- NovoEight® 296 229 29% 38% 6%
Growth disorders 1,481 1,646 (10%) 0% 0%
Other biopharmaceuticals3) 338 469 (28%) (23%) (8%)
Biopharmaceuticals total 4,322 4,691 (8%) 1% 4%
Total sales 26,930 28,452 (5%) 5% 100%
1) Primarily NovoNorm® and needles.
2) Comprises NovoSeven®, NovoEight®, NovoThirteen® and Refixia®.
3) Primarily Vagifem® and Activelle®.
Both International Operations and North America Operations contributed to sales growth with 70% and 30%
respectively. Within International Operations, the main growth contributors were Region Latin America, Region
AAMEO (Africa, Asia, Middle East and Oceania) and Region China, partly offset by Region Japan & Korea. Sales
growth in Region Latin America of 73% measured in local currencies was positively impacted by 9% percentage
points due to inflationary price effects in countries with high inflation.
Financial report for the period 1 January 2018 to 31 March 2018 Page 5 of 29
Financial
Performance Outlook R&D Sustainability Equity
Financial
Information
Company announcement No 37 / 2018
Sales split per region
Sales Q1 2018
DKK million
Growth
as reported
Growth
in local currencies
Share of growth
in local currencies
North America Operations 13,366 (11%) 3% 30%
- USA 12,878 (11%) 3% 30%
International Operations 13,564 0% 8% 70%
- Region Europe 5,233 0% 1% 2%
- Region AAMEO 2,899 (2%) 12% 23%
- Region China 3,029 (1%) 6% 12%
- Region Japan & Korea 1,257 (14%) (6%) (6%)
- Region Latin America 1,146 44% 73% 39%
Total sales 26,930 (5%) 5% 100%
Please refer to appendix 6 for further details on sales in the first three months of 2018.
In the following sections, unless otherwise noted, market data are based on moving annual total (MAT) from
February 2018 and February 2017 provided by the independent data provider IQVIA.
DIABETES CARE AND OBESITY, SALES DEVELOPMENT
Sales of diabetes care and obesity products decreased by 5% measured in Danish kroner and increased by 6% in
local currencies to DKK 22,608 million. Novo Nordisk is the world leader in diabetes care with a global value market
share of 27%.
Insulin
Sales of insulin decreased by 10% to DKK 14,659 million measured in Danish kroner and remained unchanged in
local currencies. Measured in local currencies, sales were driven by International Operations, where all five regions
apart from Region Japan & Korea contributed to growth, offset by lower sales in North America Operations. Novo
Nordisk is the global leader with 46% of the total insulin market and 45% of the market for modern insulin and
new-generation insulin, both measured in volume.
Sales of long-acting insulin (Tresiba®, Xultophy® and Levemir®) decreased by 13% measured in Danish kroner and
3% in local currencies to DKK 4,873 million.
Sales of Tresiba® (insulin degludec), the once-daily new-generation insulin, reached DKK 1,755 million compared
with DKK 1,491 million in 2017. The roll-out of Tresiba® continues and the product has now been launched in 65
countries. Generally, Tresiba® has shown solid penetration in markets with reimbursement at a similar level to insulin
glargine U100, whereas penetration remains modest in markets with restricted market access.
Sales of Xultophy®, a once-daily combination of insulin degludec (Tresiba®) and liraglutide (Victoza®), reached DKK
338 million compared with DKK 103 million in 2017. Sales growth was driven by both International Operations,
where predominantly Region Europe contributed to growth, and North America Operations. Xultophy® has now
been launched in 22 countries.
Sales of premix insulin (Ryzodeg® and NovoMix®) decreased by 8% measured in Danish kroner and increased by 1%
in local currencies to DKK 2,642 million.
Sales of Ryzodeg®, a soluble formulation of insulin degludec and insulin aspart, reached DKK 141 million compared
with DKK 95 million in 2017. Ryzodeg® has now been marketed in 20 countries, and feedback from patients and
prescribers is encouraging.
Sales of fast-acting insulin (Fiasp® and NovoRapid®) decreased by 10% to DKK 4,778 million measured in Danish
kroner and remained unchanged in local currencies.
Sales of Fiasp®, the novel mealtime fast-acting insulin aspart, were DKK 83 million. Fiasp® has been launched in 17
countries.
Financial report for the period 1 January 2018 to 31 March 2018 Page 6 of 29
Financial
Performance Outlook R&D Sustainability Equity
Financial
Information
Company announcement No 37 / 2018
INSULIN MARKET SHARES
(volume, MAT)
Novo Nordisk’s share
of the total insulin market
Novo Nordisk’s share
of the modern insulin and
new-generation insulin market*
February February February February
2018 2017 2018 2017
Global 46.4% 46.3% 45.0% 44.5%
North America Operations 39.3% 37.3% 40.1% 38.0%
- USA 39.5% 37.1% 40.6% 38.2%
International Operations 49.5% 50.3% 47.6% 48.1%
- Region Europe 44.0% 45.0% 43.7% 44.6%
- Region AAMEO** 55.6% 56.9% 50.7% 51.6%
- Region China*** 57.8% 58.8% 60.9% 60.8%
- Region Japan & Korea 49.8% 49.2% 49.6% 48.4%
- Region Latin America**** 42.7% 41.5% 39.0% 40.0%
Source: IQVIA, February 2018 data. * Modern insulin and new-generation insulin comprises the following Novo Nordisk products: Levemir®, NovoMix®, NovoRapid®,
Tresiba®, Xultophy®, Ryzodeg® and Fiasp® ** Data for 11 selected private markets representing approximately 70% of total Novo Nordisk’s diabetes care sales in the
region. *** Data for mainland China, excluding Hong Kong and Taiwan. **** Data for three selected private markets representing approximately 70% of total Novo
Nordisk’s diabetes care sales in the region.
North America Operations
Sales of insulin in North America Operations decreased by 19% in Danish kroner and by 7% in local currencies. The
decline in sales in the USA was mainly driven by lower Levemir® sales due to lower realised prices as well as lower
sales of NovoRapid® due to phasing of rebates in 2017. The sales development was partly offset by higher sales of
Tresiba® due to market share gain, underlying volume growth of both the long-acting and short-acting insulin
segments as well as increased sales of Xultophy® 100/3.6.
International Operations
Sales of insulin in International Operations decreased by 1% in Danish kroner and increased by 6% in local
currencies. Sales growth measured in local currencies was driven by long-acting, premix and fast-acting insulin,
partly offset by declining human insulin sales.
Region Europe
Sales of insulin in Region Europe increased by 1% in both Danish kroner and in local currencies. Sales were driven by
the penetration of Xultophy®, Fiasp® and Tresiba® across the region, partly offset by contracting Levemir® sales
reflecting the continued roll-out of Tresiba® as well as declining NovoMix® and human insulin sales.
Region AAMEO
Sales of insulin in Region AAMEO remained unchanged in Danish kroner and increased by 14% in local currencies.
The sales growth measured in local currencies was driven by growth of the overall diabetes care market and positive
contribution from all three insulin segments: long-acting, premix and fast-acting as well as human insulin.
Region China
Sales of insulin in Region China decreased by 3% in Danish kroner and increased by 3% in local currencies. The sales
growth measured in local currencies was driven by continued growth in the three insulin segments: long-acting,
premix and fast-acting, and Novo Nordisk has improved its market share in the long-acting and fast-acting insulin
segments and thereby stabilised the modern insulin market share, partly offset by lower human insulin sales.
Region Japan & Korea
Sales of insulin in Region Japan & Korea decreased by 10% in Danish kroner and by 2% in local currencies. The
decline in sales was driven by NovoMix® and NovoRapid® as well as lower human insulin sales, partly offset by
positive contribution from the continued uptake of Ryzodeg® and Tresiba® in Japan.
Region Latin America
Sales of insulin in Region Latin America increased by 4% in Danish kroner and by 30% in local currencies. The
increased sales is driven by growth of the overall diabetes care market and positive contribution from all three insulin
segments: long-acting, premix and fast-acting as well as human insulin.
Financial report for the period 1 January 2018 to 31 March 2018 Page 7 of 29
Financial
Performance Outlook R&D Sustainability Equity
Financial
Information
Company announcement No 37 / 2018
GLP-1 therapy for type 2 diabetes
Sales of GLP-1 therapy for type 2 diabetes (Victoza® and Ozempic®) increased by 5% in Danish kroner and by 19%
in local currencies to DKK 6,058 million. Sales growth is predominantly driven by North America Operations
comprising 84% share of the GLP-1 growth. The GLP-1 segment’s value share of the total diabetes care market has
increased to 12.3% compared with 10.2% 12 months ago. Victoza® continues to be the market leader in the GLP-1
segment with a 48% value market share.
GLP-1 MARKET SHARES
(value, MAT)
GLP-1 share of total
diabetes care market
Victoza® share
of GLP-1 market
February February February February
2018 2017 2018 2017
Global 12.3% 10.2% 48% 56%
North America Operations 14.5% 12.0% 47% 54%
- USA 14.7% 12.1% 47% 53%
International Operations 6.8% 6.0% 55% 63%
- Region Europe 10.8% 9.8% 57% 64%
- Region AAMEO* 2.8% 2.4% 47% 53%
- Region China** 1.0% 0.9% 73% 58%
- Region Japan & Korea 4.9% 3.6% 38% 55%
- Region Latin America*** 5.4% 4.8% 73% 87%
Source: IQVIA, February 2018 data MAT. * Data for 11 selected private markets representing approximately 70% of Novo Nordisk’s total diabetes care sales in the
region. ** Data for mainland China, excluding Hong Kong and Taiwan. *** Data for three selected private markets representing approximately 70% of Novo Nordisk’s
total diabetes care sales in the region.
North America Operations
Sales of Victoza® in North America Operations increased by 3% in Danish kroner and by 19% in local currencies.
Sales growth is driven by an underlying prescription volume growth of the GLP-1 class of more than 20% in the USA
and the positive impact from the expanded CV label for Victoza®. In February 2018, Novo Nordisk launched
Ozempic® in the USA, a new once-weekly GLP-1, and the initial feedback from prescribers and payers is positive and
the formulary coverage for Ozempic® is progressing well. Ozempic® sales were predominantly driven by inventory
build-up related to the launch. The growth of the GLP-1 market continues to be driven by competing once-weekly
products and Victoza®. The value share of the GLP-1 class of the total North American diabetes care market has
increased to 14.7%. Despite intensified competition, Novo Nordisk is still the market leader with a 47% value
market share.
International Operations
Sales of Victoza® in International Operations increased by 6% in Danish kroner and by 12% in local currencies. Sales
growth is driven by all regions. The value share of the GLP-1 class of the total International Operations diabetes care
market has increased to 6.8% from 6.0% in 2017. Victoza® is the market leader with a 55% value market share.
Region Europe
Sales in Region Europe increased by 7% in both Danish kroner and in local currencies. The sales development
reflects positive impact from the expanded CV label for Victoza® as well as competition from a recently introduced
once-weekly product. In Region Europe, the value share of the GLP-1 class of the total diabetes care market has
increased to 10.8%. Victoza® remains the market leader in Region Europe with a 57% value market share.
Region AAMEO
Sales in Region AAMEO increased by 1% in Danish kroner and by 16% in local currencies. Sales growth is primarily
driven by a number of countries in the Middle East. The value share of the GLP-1 class of the total diabetes care
market increased to 2.8%. Victoza® is the GLP-1 market leader across Region AAMEO with a value market share of
47%.
Region China
Sales in Region China increased by 43% in Danish kroner and by 53% in local currencies. The increase in sales
reflects the inclusion of Victoza® in the Chinese National Reimbursement Drug List in July 2017. In China, the volume
Financial report for the period 1 January 2018 to 31 March 2018 Page 8 of 29
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Financial
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Company announcement No 37 / 2018
growth is encouraging, and Victoza® has increased its GLP-1 value market share to 73%. However, the GLP-1 class
only represents 1.0% of the total diabetes care market measured in value.
Region Japan & Korea
Sales in Region Japan & Korea decreased by 6% in Danish kroner and increased by 3% in local currencies. The sales
growth measured in local currencies reflects the continued expansion of the GLP-1 market in Japan, partly offset by
intensified competition from a once-weekly product. In Region Japan & Korea, the GLP-1 class represents 4.9% of
the total diabetes care market value compared with 3.6% in 2017. Victoza® holds a value market share of 38%.
Region Latin America
Sales in Region Latin America increased by 3% in Danish kroner and by 24% in local currencies. The sales growth
reflects the continued expansion of the GLP-1 markets across the region. In Region Latin America, the GLP-1 class
represents 5.4% of the total diabetes care market value compared with 4.8% in 2017. Victoza® remains the leader
in the class with a value market share of 73%.
Other diabetes care
Sales of other diabetes care products, predominantly consisting of oral antidiabetic products and needles, declined
by 4% to DKK 1,121 million and increased by 5% in local currencies. Increasing sales measured in local currencies
were seen in both North America Operations and International Operations, where all regions apart from Region
Europe and Region AAMEO experienced increased sales.
Saxenda® (obesity)
Sales of Saxenda®, liraglutide 3 mg for weight management, increased by 43% in Danish kroner and by 64% in
local currencies to DKK 770 million. Sales growth was driven by both North America Operations and International
Operations, where Region AAMEO, Region Latin America and Region Europe contributed to growth. Saxenda® was
launched in May 2015 in the USA and has obtained broad commercial formulary market access, but generally with
prior authorisation requirements. Saxenda® has now been launched in 26 countries.
BIOPHARMACEUTICALS, SALES DEVELOPMENT
Sales of biopharmaceutical products decreased by 8% measured in Danish kroner and increased by 1% in local
currencies to DKK 4,322 million. Increasing sales were realised in International Operations, partly offset by lower
sales in North America Operations.
Haemophilia
Sales of haemophilia products decreased by 3% measured in Danish kroner and increased by 7% in local currencies
to DKK 2,503 million. The sales increase measured in local currencies was primarily driven by increased NovoSeven®
sales in Region Latin America due to timing of tender deliveries, partly offset by lower NovoSeven® sales in the USA
and Region Europe reflecting increased competition from a recently introduced product. Furthermore, sales of
NovoEight® in the USA and in Region Europe contributed to the growth.
Growth disorders
Sales of growth disorder products decreased by 10% to DKK 1,481 million measured in Danish kroner and remained
unchanged in local currencies. The sales development measured in local currencies was driven by positive
contribution from North America Operations, offset by declining sales in International Operations predominantly
Region Japan & Korea, Region AAMEO and Region Europe. Novo Nordisk is the leading company in the global
human growth disorder market with a 27% market share measured in volume.
Other biopharmaceuticals
Sales of other products within biopharmaceuticals, which predominantly consist of hormone replacement therapy-
related (HRT) products, declined by 28% measured in Danish kroner and by 23% in local currencies to DKK 338
million, primarily reflecting an effect from the launch of a generic version of Vagifem® in the USA.
Financial report for the period 1 January 2018 to 31 March 2018 Page 9 of 29
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Company announcement No 37 / 2018
DEVELOPMENT IN COSTS AND OPERATING PROFIT
The cost of goods sold remained broadly unchanged at DKK 4,197 million, resulting in a gross margin of 84.4%
measured in Danish kroner and 85.1% in local currencies, compared with 85.1% in 2017. The decline in gross
margin reflects a negative currency impact of 0.7 percentage point. In addition, the gross margin was negatively
impacted by lower prices primarily reflecting intensified competition in the insulin segment in the USA. The negative
development in gross margin was partly offset by a positive contribution from product mix due to higher Victoza®,
Tresiba® and Saxenda® sales, but partly countered by lower contribution from NovoSeven®.
Sales and distribution costs declined by 5% in Danish kroner and increased by 5% in local currencies to DKK 6,451
million. The increase in sales and distribution costs reflects higher promotional activities in both International
Operations and North America Operations to support Victoza® and Saxenda® as well as the launch activities for
Ozempic®, especially in the USA, partly offset by lower costs for legal cases.
Research and development costs increased by 1% in Danish kroner and by 5% in local currencies to DKK 3,321
million, reflecting higher costs for both research and development. The increase in research costs was driven by
increased costs for the diabetes care and obesity portfolio. The increase in development costs was predominantly
driven by the phase 3b SUSTAIN programme for Ozempic®.
Administration costs declined by 5% in Danish kroner and remained broadly unchanged in local currencies to DKK
864 million. The development in administrative costs measured in local currencies is mainly related to general cost
control initiatives.
Other operating income (net) was DKK 351 million compared with DKK 278 million in 2017. In the first three
months of 2018, Novo Nordisk recorded a net gain of DKK 122 million following the disposal of 2 million shares in
NNIT to Novo Holdings A/S. Novo Nordisk now controls 17.5% of the share capital of NNIT A/S, which remains an
associated company of Novo Nordisk A/S.
Operating profit decreased by 8% in Danish kroner and increased by 6% in local currencies to DKK 12,448 million.
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FINANCIAL ITEMS (NET)
Financial items (net) showed a net gain of DKK 1,161 million compared with a net loss of DKK 486 million in 2017.
In line with Novo Nordisk’s treasury policy, the most significant foreign exchange risks for the Group have been
hedged, primarily through foreign exchange forward contracts. The foreign exchange result was a gain of DKK
1,107 million compared with a loss of DKK 468 million in 2017. This development reflects a gain on foreign
exchange hedging involving especially the US dollar and Japanese yen versus the Danish krone.
The financial items (net) for the first three months of 2018 is after a positive market value of financials contracts as
per the end of March 2018 of approximately DKK 1.5 billion has been deferred for income recognition later in 2018.
CAPITAL EXPENDITURE AND FREE CASH FLOW
Net capital expenditure for property, plant and equipment was DKK 2.3 billion compared with DKK 1.6 billion in
2017. Net capital expenditure was primarily related to investments in a new production facility for a range of
diabetes active pharmaceutical ingredients in Clayton, North Carolina, USA, a new diabetes care filling capacity in
Hillerød, Denmark and an expansion of the manufacturing capacity for biopharmaceutical products in Kalundborg,
Denmark.
Free cash flow was DKK 7.2 billion compared with DKK 10.4 billion in 2017. The decline of 30% compared with
2017 primarily reflects the timing of rebate payments in the USA, increased capital expenditure and increased
investment in intangible assets reflecting a recent acquisition of a priority review voucher for Novo Nordisk diabetes
care and obesity development portfolio.
OUTLOOK
OUTLOOK 2018
The current expectations for 2018 are summarised in the table below:
Expectations are as reported,
if not otherwise stated
Expectations
2 May 2018
Expectations
1 February 2018
Sales growth
in local currencies 3% to 5% 2% to 5%
as reported Around 6 percentage points lower than inlocal currencies
Around 7 percentage points lower than in local
currencies
Operating profit growth
in local currencies 2% to 5% 1% to 5%
as reported Around 9 percentage points lower than inlocal currencies
Around 10 percentage points lower than in local
currencies
Financial items (net) Gain of around DKK 1.9 billion Gain of around DKK 2.5 billion
Effective tax rate 20% to 22% 20% to 22%
Capital expenditure Around DKK 9.5 billion Around DKK 9.5 billion
Depreciation, amortisation
and impairment losses Around DKK 3 billion Around DKK 3 billion
Free cash flow DKK 27-32 billion DKK 27-32 billion
For 2018, sales growth is now expected to be 3% to 5%, measured in local currencies. This guidance reflects
expectations for robust performance for the portfolio of new-generation insulin and the GLP-1 products Victoza®
and Ozempic® as well as a solid contribution from Saxenda®. Sales growth is expected to be partly countered by
intensifying global competition both within diabetes care and biopharmaceuticals, especially within the haemophilia
inhibitor segment, as well as continued pricing pressure within diabetes care, especially in the USA. Overall, the
expectations are based on an assumption of a broadly unchanged global macroeconomic environment. Given the
current exchange rates versus the Danish krone, growth reported in DKK is now expected to be around 6
percentage points lower in local currencies.
In the USA, the funding of the Medicare Part D coverage gap has been changed based on new legislation with effect
from 2019. Under the new structure, pharmaceutical companies are required to cover 70% of the coverage gap
compared with a current level of 50%. Novo Nordisk expects Group sales in 2019 to be negatively impacted by
1-2% as a result of this change.
For 2018, operating profit growth is now expected to be 2% to 5%, measured in local currencies. The
expectation for operating profit growth primarily reflects the sales growth outlook and continued focus on cost
control. The outlook also reflects a planned increase in the sales and distribution costs to support the
commercialisation efforts for Ozempic®. Given the current exchange rates versus the Danish krone, growth reported
in DKK is now expected to be around 9 percentage points lower in local currencies.
For 2018, Novo Nordisk now expects financial items (net) to amount to a gain of around DKK 1.9 billion, partly
offsetting the negative currency impact on operating profit. The current expectation for 2018 reflects gains
associated with foreign exchange hedging contracts, mainly related to the US dollar and Japanese yen versus the
Danish krone, partly offset by losses on non-hedged currencies. The expectation for financial items (net) reflects that
net gains of DKK 0.7 billion in relation to foreign exchange hedging contracts as per 25 April 2018 are expected to
be income recognised later in 2018.
The effective tax rate for 2018 is expected to be in the range of 20-22%. The range for effective tax rate is
positively impacted by the reduced federal corporate tax rate in 2018 in the USA.
Capital expenditure is expected to be around DKK 9.5 billion in 2018, primarily related to investments in additional
capacity for active pharmaceutical ingredient production within diabetes care and an expansion of the diabetes care
filling capacity. Depreciation, amortisation and impairment losses are expected to be around DKK 3 billion.
Free cash flow is expected to be DKK 27-32 billion.
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All of the above expectations are based on assumptions that the global economic and political environment will not
significantly change business conditions for Novo Nordisk during 2018, and that currency exchange rates, especially
the US dollar, will remain at the current level versus the Danish krone. Please refer to appendix 7 for key currency
assumptions.
Novo Nordisk has hedged expected net cash flows in a number of invoicing currencies and, all other things being
equal, movements in key invoicing currencies will impact Novo Nordisk’s operating profit as outlined in the table
below.
Key invoicing currencies
Impact on Novo Nordisk's
operating profit in the next 12 months of a 5%
immediate movement in currency Hedging period (months)
USD DKK 1,900 million 12
CNY DKK 330 million 6*
JPY DKK 175 million 12
GBP DKK 95 million 12
CAD DKK 80 million 10
* Chinese yuan traded offshore (CNH) used as proxy when hedging Novo Nordisk’s CNY currency exposure
The financial impact from foreign exchange hedging is included in Financial items (net).
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RESEARCH & DEVELOPMENT UPDATE
DIABETES
Ozempic® (NN9535) granted marketing authorisation by the European Commission
In February, Novo Nordisk announced that the European Commission (EC) has granted marketing authorisation for
Ozempic® (subcutaneous semaglutide) for the treatment of adults with type 2 diabetes. Ozempic® is a new once-
weekly analogue of human glucagon-like peptide-1 (GLP-1) indicated as monotherapy when metformin is
considered inappropriate due to intolerance or is contraindicated, and as an addition to other medicinal products for
the treatment of diabetes. The marketing authorisation applies to all 28 European Union member states.
The approval of Ozempic® is based on the SUSTAIN programme, a global clinical development programme that
comprised eight phase 3a trials, encompassing more than 8,000 adults with type 2 diabetes. The label reflects the
superior and sustained reductions in HbA1c and body weight achieved with Ozempic® relative to comparator
treatments, cardiovascular benefits and the statistically significant reduction in diabetic nephropathy with Ozempic®
relative to standard of care. Ozempic® has been approved in the EU for use in a multi-dose Ozempic® pen, the latest
generation of Novo Nordisk prefilled devices. In March 2018, Novo Nordisk submitted a variation application to the
European Medicines Agency (EMA), seeking approval for the change in the Ozempic® pen offering from the multi-
dose (three-dose) pen to three separate pens. The new pen offering will help facilitate reimbursement for patients
with type 2 diabetes using Ozempic®. The launch of Ozempic® is expected to take place in the first EU countries in
the second half of 2018 following the review of the variation application for the updated pen offering.
In March, Novo Nordisk, submitted a variation application for including SUSTAIN 7 data in the label in the EU.
Results from SUSTAIN 7 demonstrated that people with type 2 diabetes treated with Ozempic® experienced superior
reduction in HbA1c and body weight compared to treatment with the competing once-weekly GLP-1 receptor
agonist dulaglutide. SUSTAIN 7 was a 40-week trial investigating the efficacy and safety of 0.5 mg semaglutide
compared with 0.75 dulaglutide and 1.0 mg semaglutide compared with 1.5 mg dulaglutide, when added to
metformin.
Ozempic® (NN9535) approved in Japan for the treatment of type 2 diabetes
In March, Novo Nordisk announced that the Japanese Ministry of Health, Labour and Welfare has approved
Ozempic® based on results from the SUSTAIN clinical trial programme. The approval is based on the results from five
SUSTAIN trials, including approximately 1,200 adults from Japan. The approved label reflects that treatment with
Ozempic® resulted in greater reductions in HbA1c relative to comparator treatments, as well as greater reductions in
mean body weight achieved with Ozempic® in Japanese people compared to placebo in the two SUSTAIN
monotherapy trials. Novo Nordisk expects to launch Ozempic® in Japan once reimbursement has been obtained.
FDA approves inclusion of data on cardiovascular outcomes and severe hypoglycaemia in the Tresiba®
(NN1250) label
In March, Novo Nordisk announced that the US Food and Drug Administration (FDA) had approved an update to the
US prescribing information for Tresiba® (insulin degludec) to include data from the DEVOTE trial. The DEVOTE trial
included 7,637 adults with type 2 diabetes at high cardiovascular risk and demonstrated non-inferiority of Tresiba®
compared to insulin glargine U100 with regards to major adverse cardiovascular events (MACE) with a hazard ratio
of 0.91. MACE was defined as first occurrence of cardiovascular death, non-fatal myocardial infarction or non-fatal
stroke.
As a prespecified secondary end-point, treatment with Tresiba® resulted in 40% statistically significant lower rate of
severe hypoglycaemia compared to insulin glargine U100. The glycaemic control between the two groups was
similar at baseline and throughout the trial. The Tresiba® label was updated to reflect safety outcomes from the trial,
the cardiovascular safety as well as the severe hypoglycaemia data.
Furthermore, supplemental applications were submitted to the FDA in September 2016 for including data from the
two SWITCH phase 3b trials in the label for Tresiba®. Following interactions with FDA, Novo Nordisk has withdrawn
the applications related to the data from the SWITCH trials.
CHMP adopts positive opinion for EU label update of Xultophy® (NN9068) based on the LEADER and
DEVOTE trials
In April, the Committee for Medicinal Products for Human Use (CHMP), under the European Medicines Agency
(EMA), issued a positive opinion for including data from the LEADER and DEVOTE cardiovascular outcomes trials in
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the EU prescribing information of Xultophy®, a once-daily, single injection fixed ratio combination of a long-acting
basal insulin (insulin degludec) and a GLP-1 receptor agonist (liraglutide).
New drug application for Ryzodeg® (NN5401) submitted to the China FDA
In March, Novo Nordisk submitted a new drug application for Ryzodeg® to the China Food and Drug Administration
(FDA) based on results from a randomised trial in more than 500 Chinese adults with type 2 diabetes. The trial
demonstrated the efficacy and safety of Ryzodeg® compared with NovoMix® 30 and thereby confirmed the results
from the original development programme for Ryzodeg®.
Novo Nordisk submits application to the US FDA to include LEADER and DEVOTE data in Xultophy®
(NN9068) label
In April, Novo Nordisk submitted a supplemental New Drug Application (sNDA) to the US Food and Drug
Administration (FDA) for including data from the LEADER and DEVOTE cardiovascular outcomes trials in the product
information of Xultophy®100/3.6.
Xultophy® (NN9068) DUAL I Japan phase 3a results
In March 2018, Novo Nordisk completed the DUAL I Japan phase 3a trial with Xultophy®. The three-arm trial
investigated the efficacy and safety of Xultophy® compared with Tresiba® freely up-titrated and with Victoza®
escalated to a fixed maximum of 1.8 mg, after 52 weeks of treatment in 819 Japanese adults previously treated with
one oral antidiabetic agent.
The trial successfully met all predefined confirmatory endpoints and fulfilled its objective of demonstrating that
treatment with Xultophy® was superior compared to both Tresiba® and Victoza® with regards to lowering of HbA1c
with differences of 0.6% in favour of Xultophy® compared with Tresiba® and of 0.5% in favour of Xultophy®
compared with Victoza®. Furthermore, people treated with Xultophy® experienced weight gain of 2.9 kg, compared
with weight gain of 4.1 kg for people treated with Tresiba®, corresponding to a statistically significant and superior
treatment difference of 1.2 kg also in favour of Xultophy®. The rate of confirmed hypoglycaemic episodes per 100
person-years of exposure was 158 with Xultophy® and 325 with Tresiba® and four with Victoza®, corresponding to a
statistically significant and superior reduction of 52% with Xultophy® vs Tresiba® and a statistically significant
increase with Xultophy® vs Victoza®. No unexpected safety and tolerability issues were identified for Xultophy®.
Successful completion of the first phase 3a trial, PIONEER 1, with oral semaglutide (NN9924)
In February, Novo Nordisk announced the headline results from PIONEER 1, the first phase 3a trial with oral
semaglutide for treatment of adults with type 2 diabetes. Oral semaglutide is a new GLP-1 analogue to be taken
once daily as a tablet. The global 26-week trial investigated the efficacy and safety of 3, 7 and 14 mg oral
semaglutide compared with placebo in 703 people with type 2 diabetes.
Two distinct approaches to evaluating the effect of oral semaglutide were applied in the PIONEER 1 trial; a primary
statistical principle required by recent regulatory guidelines evaluating the effect regardless of treatment adherence
and a secondary statistical principle describing the effect if people had adhered to treatment and did not initiate
rescue medication.
The trial achieved its primary objective according to the primary statistical principle by demonstrating statistically
significant and superior improvements in HbA1c for all three doses of oral semaglutide compared to placebo.
Moreover, the 14 mg dose of oral semaglutide demonstrated statistically significant and superior weight loss versus
placebo; weight loss was observed for the 7 mg and 3 mg doses but did not reach statistical significance.
Applying the secondary statistical principle, people treated with 3, 7 and 14 mg oral semaglutide achieved
reductions in HbA1c of 0.8%, 1.3% and 1.5%, respectively, compared to a reduction of 0.1% in people treated with
placebo from a mean baseline of 8.0%. The American Diabetes Association (ADA) treatment target of HbA1c below
7.0% was achieved by 59%, 72% and 80% of people on treatment with 3, 7 and 14 mg oral semaglutide,
respectively, compared to 34% of the people treated with placebo. In addition, from a mean baseline body weight
of 88 kg and a BMI of 31.8 kg/m2, people treated with 3, 7 and 14 mg oral semaglutide experienced a weight loss
of 1.7 kg, 2.5 kg and 4.1 kg, respectively, compared to a weight loss of 1.5 kg in people treated with placebo.
In the trial, oral semaglutide appeared to have a safe and well-tolerated clinical profile. The most common adverse
event for all three oral semaglutide doses was mild to moderate nausea, which diminished over time. Between 5%
and 16% of people treated with oral semaglutide experienced nausea, compared to 6% of people treated with
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placebo. Premature treatment discontinuation due to adverse events ranged from 2% to 7% for people treated with
oral semaglutide, compared to 2% for people treated with placebo.
LAI287 (NN1436) phase 1 trial successfully completed
In February, Novo Nordisk completed a phase 1 multiple dose trial, investigating the safety, tolerability,
pharmacokinetics (PK) and pharmacodynamics (PD) of an optimised formulation of LAI287 for subcutaneous
administration to individuals with type 2 diabetes. LAI287 is injectable insulin intended for once-weekly dosing to
cover the basal insulin requirement in patients with diabetes. The trial demonstrated that LAI287 was well tolerated,
and glucose control and variability were similar to that obtained with Tresiba®. Following the successful completion
of the phase 1 trial, planning of phase 2 is proceeding with initiation expected before the end of 2018.
Development of PI406 (NN1406) to be discontinued following phase 1 results
In November 2017, Novo Nordisk completed a phase 1 trial with PI406 in people with type 1 diabetes. The phase 1
trial was a randomised clinical proof-of-principle trial investigating the pharmacokinetics (PK), pharmacodynamics
(PD), the liver preferentiality and safety of PI406. Following the completion of the trial, a benefit/risk assessment was
conducted and it was concluded that despite of the liver preferentiality of PI406, the observed PK/PD profile does
not seem optimal for bolus insulin. Consequently, Novo Nordisk has discontinued further development of PI406.
HypoPen 1513 (NN9513) phase 1 trial initiated
In February, Novo Nordisk initiated the first phase 1 trial with HypoPen 1513, an easy-to-use glucagon product for
treatment of severe hypoglycaemia. HypoPen 1513 is a glucagon analogue that is physically and chemically stable
with a pharmacological profile that is similar to native glucagon. The purpose of this first trial in humans is to
evaluate safety and tolerability of a single-dose HypoPen 1513 across a broad dose range.
OBESITY
AM833 (NN9838) phase 1 trial successfully completed
In April, Novo Nordisk completed a phase 1 multiple dose trial, investigating the safety, tolerability, pharmacokinetics
(PK) and pharmacodynamics (PD) of multiple subcutaneous doses of AM833, dosed either once daily or once weekly
in individuals being overweight or with obesity. AM833 is a long-acting amylin analogue designed for weight
management treatment following once-weekly dosing. The trial demonstrated that AM833 was safe and well-
tolerated and with a PK profile supporting once-weekly dosing. There was an intended weight-loss observed with
AM833 compared to placebo, and Novo Nordisk is consequently planning to proceed to phase 2 with an expected
initiation early 2019.
BIOPHARMACEUTICALS
Novo Nordisk files for regulatory approval of long-acting factor VIII (N8-GP - NN7088) in the USA and the
EU for treatment of haemophilia A
In February, Novo Nordisk announced the submission of a Biologics License Application (BLA) to the US FDA and a
Marketing Authorisation Application (MAA) to the EMA for N8-GP, an extended half-life factor VIII for treatment of
people with haemophilia A.
The submission was based on results from the pathfinder clinical trial programme. The pathfinder programme
included more than 250 people with haemophilia A and investigated efficacy and safety of N8-GP in adults and
children as well as people undergoing surgery. In the trial, adults treated prophylactically with N8-GP every fourth
day experienced a median annualised bleeding rate of 1.3 episodes compared to 30.9 episodes for people treated
on-demand. Paediatric participants experienced a median annualised bleeding rate of 1.95 episodes when
administered twice weekly. In the surgery trial, all surgeries were effectively performed with N8-GP, and clinical
efficacy evaluated by haemostatic response was reported as ‘excellent’ or ‘good’ in 43 out of the 45 performed
surgeries. Across the pathfinder clinical trial programme, N8-GP demonstrated a safe and well-tolerated profile.
Phase 1/ 2 multiple-dose trial with SC N8-GP (NN7170) initiated following completion of single-dose trial
In February, Novo Nordisk initiated the multiple-dose part of the phase 1/2 trial, Alleviate 1, with SC N8-GP following
the completion of the single-dose part of the trial. SC N8-GP is a subcutaneous (SC) formulation of glycopegylated
recombinant factor VIII (turoctocog alfa) intended to be a convenient subcutaneous treatment with N8-GP for
bleeding prophylaxis in patients with haemophilia A. Alleviate 1 is a phase 1/2 single and multiple dosing trial to
assess the safety, PK and preliminary efficacy in prevention of bleeds following single and multiple administrations of
SC N8-GP in patients with severe haemophilia A.
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Novo Nordisk obtains exclusive worldwide licence to EpiDestiny’s sickle cell disease programme
In April, Novo Nordisk and EpiDestiny announced that Novo Nordisk has obtained an exclusive worldwide licence to
EpiDestiny’s sickle cell disease (SCD) programme, EPI01. EpiDestiny is eligible to receive more than 400 million US
dollars in upfront, development and sales milestone payments and will get royalties on net sales. EpiDestiny and
Novo Nordisk will collaborate to develop EPI01 in SCD and beta-thalassaemia. EpiDestiny retains all rights to
continue development of EPI01 in oncology.
Increasing levels of foetal haemoglobin (HbF) have important clinical benefits in SCD and beta-thalassaemia patients.
Elevated HbF correlated with increased red blood cell half-life, reduced number of pain crises and increased life
expectancy. EPI01 is a novel, orally available, disease-modifying therapy to increase HbF and interrupt SCD
pathophysiology. EpiDestiny recently completed a phase 1 trial with EPI01 in SCD patients demonstrating increased
HbF expression and safety after eight weeks of administration in a small patient cohort. The clinical observations
demonstrated the potential for EPI01 to serve as a safe and potentially disease-modifying therapy for SCD.
Norditropin® label in the USA updated with two additional indications
In February, the US FDA approved two new indications for Norditropin®. In addition to the five existing indications,
Norditropin® can now be used for treating children with growth failure due to Idiopathic Short Stature (ISS) and
Prader-Willi Syndrome (PWS).
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SUSTAINABILITY UPDATE
The number of employees in Novo Nordisk increased by 2.5%
The number of full-time employees at the end of the first three months of 2018 increased by 2.5% compared to 12
months ago. The total number of employees was 43,220, corresponding to 42,688 full-time positions. The growth
in employees was mainly driven by the expansion of the global service centre in Bangalore, India, partly offset by
workforce reductions in North America Operations.
Red Cross and Novo Nordisk announce partnership to tackle chronic care in humanitarian crises
Novo Nordisk has partnered with the International Committee of the Red Cross (ICRC) and the Danish Red Cross
(DRC) to tackle the growing issue of chronic diseases, including diabetes, that affect millions of people living in
humanitarian crises around the world. The partnership will work to ensure efficient supply of low-cost human
insulin in vials to Red Cross operations globally, support ICRC’s and DRC’s health programmes including efforts to
improve NCD prevention and care and develop 2-3 field projects. The partnership runs for a period of three years
from 2018 to 2020. Novo Nordisk intends to adapt its ordering and production procedures to better serve the needs
of humanitarian organisations as well as share its knowledge on handling and distributing cold chain products.
Furthermore, Novo Nordisk will share its wide experience in building capacity to improve access to diabetes care,
and support the development of educational materials on diabetes prevention and care for a humanitarian context.
The financial contribution from Novo Nordisk to the partnership amounts to DKK 21.5 million.
EQUITY
Total equity was DKK 44,238 million at the end of the first three months of 2018, equivalent to 47.3% of total
assets, compared with 42.8% at the end of the first three months of 2017. Please refer to appendix 5 for further
elaboration of changes in equity.
Reduction in share capital
At the Annual General Meeting of Novo Nordisk A/S, held on 22 March 2018, a 2.00% reduction in the total share
capital was approved. The reduction was effectuated by a cancellation of 50,000,000 treasury B shares of DKK 0.20
at a nominal value of DKK 10,000,000. After the legal implementation of the share capital reduction on 24 April
2018, Novo Nordisk’s share capital now amounts to DKK 490,000,000 divided into an A share capital of DKK
107,487,200 and a B share capital of DKK 382,512,800.
2018 share repurchase programme
On 5 February 2018, Novo Nordisk announced a share repurchase programme of up to DKK 2.5 billion to be
executed from 6 February to 30 April 2018, as part of an overall programme February 2018 to January 2019 of up
to DKK 14 billion to be executed during a 12-month period. The purpose of the programme was to reduce the
company’s share capital. Under the programme, Novo Nordisk has repurchased 8,268,117 B shares for an amount of
DKK 2.5 billion in the period from 6 February to 30 April 2018. The programme was concluded on 30 April 2018. As
of 30 April 2018, Novo Nordisk A/S has repurchased a total of 11,355,527 B shares equal to a transaction value of
DKK 3.5 billion under the DKK 14 billion programme beginning 1 February 2018.
As of 30 April 2018, Novo Nordisk A/S and its wholly-owned affiliates owned 21,330,353 of its own B shares,
corresponding to 0.9% of the total share capital.
Share repurchase under the overall programme of up to DKK 14 billion in the period February 2018 to January 2019
is expected to be resumed shortly. As announced in February 2018, Novo Nordisk’s majority shareholder Novo
Holdings A/S, a holding company fully owned by the Novo Nordisk Foundation, has informed Novo Nordisk that it
intends to consider its participation in the Novo Nordisk share repurchase programme on a year-by-year basis. For
2018, Novo Holdings A/S has informed Novo Nordisk that it plans to participate in the share repurchase programme.
Novo Holdings A/S has an ownership of 28.5% of the Novo Nordisk share capital after the implementation of the
share capital decrease and Novo Holdings A/S currently intends to maintain its ownership of the Novo Nordisk share
capital around 28%.
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Forward-looking statements
Novo Nordisk’s reports filed with or furnished to the US Securities and Exchange Commission (SEC), including this
document as well as the company’s statutory Annual Report 2017 and Form 20-F, both filed with the SEC in
February 2018, and written information released, or oral statements made, to the public in the future by or on
behalf of Novo Nordisk, may contain forward-looking statements. Words such as ‘believe’, ‘expect’, ‘may’, ‘will’,
‘plan’, ‘strategy’, ‘prospect’, ‘foresee’, ‘estimate’, ‘project’, ‘anticipate’, ‘can’, ‘intend’, ‘target’ and other words and
terms of similar meaning in connection with any discussion of future operating or financial performance identify
forward-looking statements. Examples of such forward-looking statements include, but are not limited to:
• statements of targets, plans, objectives or goals for future operations, including those related to Novo
Nordisk’s products, product research, product development, product introductions and product approvals as
well as cooperation in relation thereto
• statements containing projections of or targets for revenues, costs, income (or loss), earnings per share,
capital expenditures, dividends, capital structure, net financials and other financial measures
• statements regarding future economic performance, future actions and outcome of contingencies such as
legal proceedings, and
• statements regarding the assumptions underlying or relating to such statements.
In this document, examples of forward-looking statements can be found under the headings ‘Outlook’, ‘Research
and Development update’ and Equity’.
These statements are based on current plans, estimates and projections. By their very nature, forward-looking
statements involve inherent risks and uncertainties, both general and specific. Novo Nordisk cautions that a number
of important factors, including those described in this document, could cause actual results to differ materially from
those contemplated in any forward-looking statements.
Factors that may affect future results include, but are not limited to, global as well as local political and economic
conditions, including interest rate and currency exchange rate fluctuations, delay or failure of projects related to
research and/or development, unplanned loss of patents, interruptions of supplies and production, product recalls,
unexpected contract breaches or terminations, government-mandated or market-driven price decreases for Novo
Nordisk’s products, introduction of competing products, reliance on information technology, Novo Nordisk’s ability to
successfully market current and new products, exposure to product liability and legal proceedings and investigations,
changes in governmental laws and related interpretation thereof, including on reimbursement, intellectual property
protection and regulatory controls on testing, approval, manufacturing and marketing, perceived or actual failure to
adhere to ethical marketing practices, investments in and divestitures of domestic and foreign companies,
unexpected growth in costs and expenses, failure to recruit and retain the right employees, and failure to maintain a
culture of compliance.
For an overview of some, but not all, of the risks that could adversely affect Novo Nordisk’s results or the accuracy of
forward-looking statements in this document, reference is made to the overview of risk factors in ‘The Risks of Doing
Business’ on pp 40-43 of the Annual Report 2017.
Unless required by law, Novo Nordisk is under no duty and undertakes no obligation to update or revise any
forward-looking statement after the distribution of this document, whether as a result of new information, future
events or otherwise.
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MANAGEMENT STATEMENT
The Board of Directors and Executive Management have reviewed and approved the financial report of Novo Nordisk
A/S for the first three months of 2018. The financial report has not been audited or reviewed by the company’s
independent auditors.
The financial report for the first three months of 2018 has been prepared in accordance with IAS 34 'Interim
Financial Reporting’. The accounting policies adopted in the preparation are consistent with those applied in the
Annual Report 2017 of Novo Nordisk, except for the adoption of new, amended or revised standards and
interpretations (IFRSs) as published by the IASB that are endorsed by the EU effective as of 1 January 2018. This
includes IFRS 9 'Financial Instruments' applied prospectively and IFRS 15 'Revenue from Contracts with Customers'
applied modified retrospectively. Furthermore, the financial report for the first three months of 2018 and
Management’s Review are prepared in accordance with additional Danish disclosure requirements for interim reports
of listed companies.
In our opinion, the accounting policies used are appropriate and the overall presentation of the financial report for
the first three months of 2018 is adequate. Furthermore, in our opinion, Management’s Review includes a true and
fair account of the development in the operations and financial circumstances, of the results for the period and of
the financial position of the Group as well as a description of the most significant risks and elements of uncertainty
facing the Group in accordance with Danish disclosure requirements for listed companies.
Besides what has been disclosed in the quarterly financial report, no changes in the Group’s most significant risks
and uncertainties have occurred relative to what was disclosed in the consolidated annual report for 2017.
Bagsværd, 2 May 2018
Executive Management:
Lars Fruergaard Jørgensen
President and CEO
Karsten Munk Knudsen
CFO
Jesper Brandgaard
Lars Green Camilla Sylvest Mads Krogsgaard Thomsen
Henrik Wulff
Board of Directors:
Helge Lund
Chairman
Jeppe Christiansen
Vice chairman
Brian Daniels
Andreas Fibig Sylvie Grégoire Liz Hewitt
Mette Bøjer Jensen Kasim Kutay Anne Marie Kverneland
Martin Mackay Thomas Rantzau Stig Strøbæk
Financial report for the period 1 January 2018 to 31 March 2018 Page 19 of 29
Financial
Performance Outlook R&D Sustainability Equity
Financial
Information
Company announcement No 37 / 2018
APPENDIX 1: QUARTERLY NUMBERS IN DKK
(Amounts in DKK million, except number of full-time equivalent employees, earnings per share and number of shares outstanding).
% change
2018 2017 Q1 2018 vs
Q1 Q4 Q3 Q2 Q1 Q1 2017
Net sales 26,930 27,992 26,614 28,638 28,452 (5%)
Gross profit 22,733 23,292 22,342 24,229 24,201 (6%)
Gross margin 84.4% 83.2% 83.9% 84.6% 85.1%
Sales and distribution costs 6,451 8,295 6,497 6,761 6,787 (5%)
Percentage of sales 24.0% 29.6% 24.4% 23.6% 23.9%
Research and development costs 3,321 3,983 3,328 3,414 3,289 1%
Percentage of sales 12.3% 14.2% 12.5% 11.9% 11.6%
Administrative costs 864 1,118 896 857 913 (5%)
Percentage of sales 3.2% 4.0% 3.4% 3.0% 3.2%
Other operating income, net 351 151 423 189 278 26%
Operating profit 12,448 10,047 12,044 13,386 13,490 (8%)
Operating margin 46.2% 35.9% 45.3% 46.7% 47.4%
Financial income 1,198 175 392 421 258 N/A
Financial expenses 37 (349) (26) 1,164 744 N/A
Financial items (net) 1,161 524 418 (743) (486) N/A
Profit before income taxes 13,609 10,571 12,462 12,643 13,004 5%
Income taxes 2,858 2,318 2,692 2,692 2,848 0%
Net profit 10,751 8,253 9,770 9,951 10,156 6%
Depreciation, amortisation and impairment losses 732 905 706 863 708 3%
Capital expenditure (net) 2,310 3,043 2,098 1,934 1,604 44%
Net cash generated from operating activities 9,815 6,032 12,921 10,117 12,098 (19%)
Free cash flow 7,241 2,866 10,930 8,392 10,400 (30%)
Total assets 93,558 102,355 97,891 97,825 94,213 (1%)
Total equity 44,238 49,815 46,946 48,436 40,301 10%
Equity ratio 47.3% 48.7% 48.0% 49.5% 42.8%
Full-time equivalent employees end of period 42,688 42,076 41,656 41,385 41,636 3%
Basic earnings per share/ADR (in DKK) 4.41 3.38 3.96 4.01 4.07 8%
Diluted earnings per share/ADR (in DKK) 4.40 3.36 3.96 4.01 4.06 8%
Average number of shares outstanding (million) 2,437.3 2,451.2 2,465.6 2,480.2 2,495.8 (2%)
Average number of diluted shares
outstanding (million) 2,442.3 2,456.1 2,469.4 2,484.1 2,500.0 (2%)
Sales by business segment:
Long-acting insulin 4,873 5,494 5,098 5,976 5,606 (13%)
Premix insulin 2,642 2,622 2,562 2,704 2,861 (8%)
Fast-acting insulin 4,778 4,618 5,087 5,102 5,317 (10%)
Human insulin1) 2,366 2,393 2,429 2,455 2,516 (6%)
Total insulin 14,659 15,127 15,176 16,237 16,300 (10%)
Total GLP-1 6,058 6,305 5,343 5,775 5,750 5%
Other diabetes care1) 1,121 1,014 1,044 1,072 1,172 (4%)
Total diabetes care 21,838 22,446 21,563 23,084 23,222 (6%)
Obesity (Saxenda®) 770 697 640 686 539 43%
Diabetes care and obesity total 22,608 23,143 22,203 23,770 23,761 (5%)
Haemophilia 2,503 2,750 2,404 2,739 2,576 (3%)
Growth disorders 1,481 1,709 1,621 1,679 1,646 (10%)
Other biopharmaceuticals 338 390 386 450 469 (28%)
Biopharmaceuticals total 4,322 4,849 4,411 4,868 4,691 (8%)
Sales by geographic segment:
North America Operations 13,366 14,434 13,532 15,103 14,940 (11%)
- USA 12,878 13,879 12,967 14,583 14,402 (11%)
International Operations 13,564 13,558 13,082 13,535 13,512 0%
- Region Europe 5,233 5,418 5,190 5,355 5,226 0%
- Region AAMEO 2,899 3,068 2,929 3,057 2,964 (2%)
- Region China 3,029 2,510 2,531 2,608 3,060 (1%)
- Region Japan & Korea 1,257 1,570 1,462 1,573 1,467 (14%)
- Region Latin America 1,146 992 970 942 795 44%
Segment operating profit:
Diabetes care and obesity 9,934 7,689 9,298 10,735 10,631 (7%)
Biopharmaceuticals 2,514 2,358 2,746 2,651 2,859 (12%)
1) Comparative figures have been restated as sales of bulk insulin is now disclosed as part of other diabetes care.
Financial report for the period 1 January 2018 to 31 March 2018 Page 20 of 29
Financial
Performance Outlook R&D Sustainability Equity
Financial
Information
Company announcement No 37 / 2018
APPENDIX 2: INCOME STATEMENT AND STATEMENT OF COMPREHENSIVE INCOME
Q1 Q1
DKK million 2018 2017
Income statement
Net sales 26,930 28,452
Cost of goods sold 4,197 4,251
Gross profit 22,733 24,201
Sales and distribution costs 6,451 6,787
Research and development costs 3,321 3,289
Administrative costs 864 913
Other operating income, net 351 278
Operating profit 12,448 13,490
Financial income 1,198 258
Financial expenses 37 744
Profit before income taxes 13,609 13,004
Income taxes 2,858 2,848
NET PROFIT 10,751 10,156
Basic earnings per share (DKK) 4.41 4.07
Diluted earnings per share (DKK) 4.40 4.06
Segment Information
Segment sales:
Diabetes care and obesity 22,608 23,761
Biopharmaceuticals 4,322 4,691
Segment operating profit:
Diabetes care and obesity 9,934 10,631
Operating margin 43.9% 44.7%
Biopharmaceuticals 2,514 2,859
Operating margin 58.2% 60.9%
Total segment operating profit 12,448 13,490
Statement of comprehensive income
Net profit for the Period 10,751 10,156
Other comprehensive income
Items that will not subsequently be reclassified to the Income statement
Remeasurements on defined benefit plans 76 85
Items that will be reclassified subsequently to the Income statement
Exchange rate adjustments of investments in subsidiaries 33 (56)
Cash flow hedges, realisation of previously deferred (gains)/losses (1,084) 589
Cash flow hedges, deferred gains/(losses) incurred during the period 637 (6)
Other items 13 (138)
Tax on other comprehensive income, income/(expense) 62 19
Other comprehensive income for the Period, net of tax (263) 493
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD 10,488 10,649
Financial report for the period 1 January 2018 to 31 March 2018 Page 21 of 29
Financial
Performance Outlook R&D Sustainability Equity
Financial
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Company announcement No 37 / 2018
APPENDIX 3: CASH FLOW STATEMENT
DKK million Q1 2018 Q1 2017
Net profit 10,751 10,156
Adjustment for non-cash items:
Income taxes in the Income Statement 2,858 2,848
Depreciation, amortisation and impairment losses 732 708
NNIT non-recurring income included in 'other operating income' (122) —
Other non-cash items (699) 1,995
Change in working capital 644 (90)
Interest received 12 30
Interest paid (33) (21)
Income taxes paid (4,328) (3,528)
Net cash generated from operating activities 9,815 12,098
Proceeds from the partial divestment NNIT A/S 368 —
Purchase of intangible assets (885) (108)
Purchase of property, plant and equipment (2,073) (1,604)
Proceeds from other financial assets 6 —
Sale of marketable securities — 1,006
Dividend received from associated company 10 14
Net cash used in investing activities (2,574) (692)
Purchase of treasury shares, net (4,334) (4,245)
Dividends paid (11,810) (11,448)
Withheld dividend tax 2,007 1,968
Net cash used in financing activities (14,137) (13,725)
NET CASH GENERATED FROM ACTIVITIES (6,896) (2,319)
Cash and cash equivalents at the beginning of the year 17,158 18,461
Exchange gain/(loss) on cash and cash equivalents 23 8
Cash and cash equivalents at the end of the period 10,285 16,150
Financial report for the period 1 January 2018 to 31 March 2018 Page 22 of 29
Financial
Performance Outlook R&D Sustainability Equity
Financial
Information
Company announcement No 37 / 2018
APPENDIX 4: BALANCE SHEET
DKK million 31 Mar 2018 31 Dec 2017
ASSETS
Intangible assets 4,035 3,325
Property, plant and equipment 36,134 35,247
Investment in associated company 530 784
Deferred income tax assets 1,914 1,941
Other financial assets 1,030 978
TOTAL NON-CURRENT ASSETS 43,643 42,275
Inventories 15,867 15,373
Trade receivables 16,342 20,165
Tax receivables 2,309 958
Other receivables and prepayments 2,660 2,428
Derivative financial instruments 2,224 2,304
Cash at bank 10,513 18,852
TOTAL CURRENT ASSETS 49,915 60,080
TOTAL ASSETS 93,558 102,355
EQUITY AND LIABILITIES
Share capital 500 500
Treasury shares (14) (11)
Retained earnings 43,652 48,977
Other reserves 100 349
TOTAL EQUITY 44,238 49,815
Deferred income tax liabilities 791 846
Retirement benefit obligations 1,196 1,336
Provisions 3,165 3,302
Total non-current liabilities 5,152 5,484
Current debt 228 1,694
Trade payables 4,117 5,610
Tax payables 4,093 4,242
Other liabilities 15,441 14,446
Derivative financial instruments 278 309
Provisions 20,011 20,755
Total current liabilities 44,168 47,056
TOTAL LIABILITIES 49,320 52,540
TOTAL EQUITY AND LIABILITIES 93,558 102,355
Financial report for the period 1 January 2018 to 31 March 2018 Page 23 of 29
Financial
Performance Outlook R&D Sustainability Equity
Financial
Information
Company announcement No 37 / 2018
APPENDIX 5: EQUITY STATEMENT
Other reserves
DKK million
Share
capital
Treasury
shares
Retained
earnings
Exchange
rate
adjust-
ments
Cash
flow
hedges
Tax and
other
adjust-
ments
Total
other
reserves Total
Q1 2018
Balance at the beginning of the period 500 (11) 48,977 (1,556) 2,027 (122) 349 49,815
Change in accounting policy, IFRS 9 (90) 90 90 —
Net profit for the period 10,751 10,751
Other comprehensive income for the period 76 33 (447) 75 (339) (263)
Total comprehensive income for the period 10,737 33 (447) 165 (249) 10,488
Transactions with owners:
Dividends (11,810) (11,810)
Share-based payments 97 97
Tax credit related to restricted stock units (18) (18)
Purchase of treasury shares (3) (4,331) (4,334)
Balance at the end of the period 500 (14) 43,652 (1,523) 1,580 43 100 44,238
Other reserves
DKK million
Share
capital
Treasury
shares
Retained
earnings
Exchange
rate
adjust-
ments
Cash
flow
hedges
Tax and
other
adjust-
ments
Total
other
reserves Total
Q1 2017
Balance at the beginning of the period 510 (9) 46,111 (924) (1,915) 1,496 (1,343) 45,269
Net profit for the period 10,156 10,156
Other comprehensive income for the period 85 (56) 583 (119) 408 493
Total comprehensive income for the period 10,241 (56) 583 (119) 408 10,649
Transactions with owners:
Dividends (11,448) (11,448)
Share-based payments 79 79
Tax credit related to restricted stock units (3) (3)
Purchase of treasury shares (4) (4,241) (4,245)
Balance at the end of the period 510 (13) 40,739 (980) (1,332) 1,377 (935) 40,301
Financial report for the period 1 January 2018 to 31 March 2018 Page 24 of 29
Financial
Performance Outlook R&D Sustainability Equity
Financial
Information
Company announcement No 37 / 2018
APPENDIX 6: REGIONAL SALES SPLIT
Q1 2018 sales split per region
DKK million Total
North
America
Operations USA
Inter-
national
Operations
Region
Europe
Region
AAMEO
Region
China
Region
Japan &
Korea
Region
Latin
America
The diabetes care and obesity segment
Long-acting insulin 4,873 2,981 2,917 1,892 1,005 310 204 197 176
% change in local currencies (3%) (10%) (10%) 13% 4% 30% 22% 6% 42%
Tresiba® 1,755 1,119 1,110 636 274 90 2 172 98
% change in local currencies 33% 34% 33% 31% 24% 82% 100% 10% 63%
Levemir® 2,780 1,768 1,714 1,012 510 202 202 25 73
% change in local currencies (22%) (29%) (29%) (6%) (21%) 7% 21% (15%) 15%
Premix insulin 2,642 411 402 2,231 428 635 989 147 32
% change in local currencies 1% (17%) (16%) 5% (9%) 14% 7% 3% 22%
NovoMix® 2,501 411 402 2,090 419 577 989 80 25
% change in local currencies (1%) (17%) (16%) 3% (10%) 11% 7% (22%) 18%
Fast-acting insulin 4,778 2,542 2,454 2,236 1,096 498 369 190 83
% change in local currencies 0% (7%) (7%) 10% 6% 13% 17% (7%) 47%
NovoRapid® 4,695 2,522 2,439 2,173 1,033 498 369 190 83
% change in local currencies (2%) (7%) (7%) 7% 0% 13% 17% (7%) 47%
Human insulin 2,366 485 453 1,881 404 474 799 42 162
% change in local currencies 3% 31% 38% (3%) (7%) 8% (9%) (19%) 12%
Total insulin 14,659 6,419 6,227 8,240 2,933 1,917 2,361 576 453
% change in local currencies 0% (7%) (7%) 6% 1% 14% 3% (2%) 30%
Victoza® 5,989 4,518 4,390 1,471 871 237 110 126 127
% change in local currencies 18% 19% 20% 12% 7% 16% 53% 3% 24%
Other diabetes care1) 1,190 289 250 901 138 160 502 83 18
% change in local currencies 11% 40% 46% 4% (9%) (6%) 11% 1% 47%
Total diabetes care 21,838 11,226 10,865 10,612 3,942 2,314 2,973 785 598
% change in local currencies 5% 3% 3% 7% 2% 13% 6% (1%) 29%
Obesity (Saxenda®) 770 550 504 220 38 92 — — 90
% change in local currencies 64% 55% 55% 92% 138% 141% — — 51%
Diabetes care and obesity total 22,608 11,776 11,370 10,832 3,980 2,406 2,973 785 688
% change in local currencies 6% 5% 5% 8% 2% 15% 6% (1%) 31%
The biopharmaceuticals segment
Haemophilia 2,503 928 899 1,575 708 287 51 133 396
% change in local currencies 7% (13%) (12%) 24% (5%) 4% 0% (9%) 424%
NovoSeven® 2,154 818 792 1,336 534 263 51 96 392
% change in local currencies 3% (17%) (17%) 22% (14%) (3%) 0% (11%) 431%
NovoEight® 296 76 76 220 167 16 — 33 4
% change in local currencies 38% 40% 39% 37% 39% 350% — (8%) 150%
Growth disorders 1,481 550 548 931 378 155 4 332 62
% change in local currencies 0% 12% 11% (7%) (3%) (13%) 0% (11%) 20%
Other biopharmaceuticals 338 112 61 226 167 51 1 7 —
% change in local currencies (23%) (34%) (48%) (16%) (8%) (10%) (67%) (74%) —
Biopharmaceuticals total 4,322 1,590 1,509 2,732 1,253 493 56 472 458
% change in local currencies 1% (8%) (7%) 8% (5%) (4%) (3%) (14%) 251%
Total sales 26,930 13,366 12,878 13,564 5,233 2,899 3,029 1,257 1,146
% change in local currencies 5% 3% 3% 8% 1% 12% 6% (6%) 73%
% change as reported (5%) (11%) (11%) 0% 0% (2%) (1%) (14%) 44%
Share of growth 100% 30% 30% 70% 2% 23% 12% (6%) 39%
1) Primarily NovoNorm®, Ozempic® and needles.
Financial report for the period 1 January 2018 to 31 March 2018 Page 25 of 29
Financial
Performance Outlook R&D Sustainability Equity
Financial
Information
Company announcement No 37 / 2018
APPENDIX 7: KEY CURRENCY ASSUMPTIONS
DKK per 100
2016 average
exchange rates
2017 average
exchange rates
YTD 2018 average
exchange rates
as of 25 April 2018
Current
exchange rates
as of 25 April 2018
USD 673 660 606 612
CNY 101.3 97.6 95.5 96.8
JPY 6.21 5.88 5.60 5.60
GBP 911 849 845 853
CAD 508 508 479 474
Financial report for the period 1 January 2018 to 31 March 2018 Page 26 of 29
Financial
Performance Outlook R&D Sustainability Equity
Financial
Information
Company announcement No 37 / 2018
APPENDIX 8: QUARTERLY NUMBERS IN USD (ADDITIONAL INFORMATION)
Key figures are translated into USD as additional information - the translation is based on the average exchange rate for income statement and the exchange rate at
the balance sheet date for balance sheet items. The specified percent changes in DKK are based on the changes in the 'Quarterly numbers in DKK', see appendix 1.
The specified percentage changes in USD is calculated as a development in USD numbers in this appendix.
(Amounts in USD million, except number of full-time equivalent employees, earnings per share and number of shares outstanding).
% change % change
2018 2017 Q1 2018 vs Q1 2018 vs
Q1 Q4 Q3 Q2 Q1 Q1 2017 inUSD
Q1 2017 in
DKK
Net sales 4,446 4,418 4,198 4,230 4,073 9% (5%)
Gross profit 3,753 3,678 3,526 3,579 3,465 8% (6%)
Gross margin 84.4% 83.2% 83.9% 84.6% 85.1%
Sales and distribution costs 1,065 1,299 1,023 999 972 10% (5%)
Percentage of sales 24.0% 29.6% 24.4% 23.6% 23.9%
Research and development costs 548 625 523 504 471 16% 1%
Percentage of sales 12.3% 14.2% 12.5% 11.9% 11.6%
Administrative costs 143 175 141 126 131 9% (5%)
Percentage of sales 3.2% 4.0% 3.4% 3.0% 3.2%
Other operating income, net 58 25 65 28 40 45% 26%
Operating profit 2,055 1,604 1,904 1,978 1,931 6% (8%)
Operating margin 46.2% 35.9% 45.3% 46.7% 47.4%
Financial income 198 29 61 62 37 N/A N/A
Financial expenses 6 (49) 3 172 106 N/A N/A
Financial items (net) 192 78 58 (110) (69) N/A N/A
Profit before income taxes 2,247 1,682 1,962 1,868 1,862 21% 5%
Income taxes 472 368 424 398 408 16% 0%
Net profit 1,775 1,314 1,538 1,470 1,454 22% 6%
Depreciation, amortisation and impairment losses 121 142 112 127 101 20% 3%
Capital expenditure (net) 381 473 327 285 230 66% 44%
Net cash generated from operating activities 1,620 988 2,017 1,499 1,732 (6%) (19%)
Free cash flow 1,195 497 1,706 1,244 1,489 (20%) (30%)
Total assets 15,577 16,491 15,540 15,004 13,532 15% (1%)
Total equity 7,365 8,026 7,452 7,429 5,789 27% 10%
Equity ratio 47.3% 48.7% 48.0% 49.5% 42.8%
Full-time equivalent employees end of period 42,688 42,076 41,656 41,385 41,636 3% 3%
Basic earnings per share/ADR (in DKK) 0.73 0.54 0.62 0.60 0.58 26% 8%
Diluted earnings per share/ADR (in DKK) 0.73 0.53 0.63 0.59 0.58 26% 8%
Average number of shares outstanding (million) 2,437.3 2,451.2 2,465.6 2,480.2 2,495.8 (2%) (2%)
Average number of diluted shares
outstanding (million) 2,442.3 2,456.1 2,469.4 2,484.1 2,500.0 (2%) (2%)
Sales by business segment:
Long-acting insulin 805 868 806 883 802 0% (13%)
Premix insulin 436 414 405 399 410 6% (8%)
Fast-acting insulin 789 732 800 755 761 4% (10%)
Human insulin1) 391 378 382 363 360 9% (6%)
Total insulin 2,421 2,392 2,393 2,400 2,333 4% (10%)
Total GLP-1 1,000 991 843 853 823 22% 5%
Other diabetes care1) 185 161 165 158 168 10% (4%)
Total diabetes care 3,606 3,544 3,401 3,411 3,324 8% (6%)
Obesity (Saxenda®) 127 109 101 101 77 65% 43%
Diabetes care and obesity total 3,733 3,653 3,502 3,512 3,401 10% (5%)
Haemophilia 413 434 380 403 369 12% (3%)
Growth disorders 244 269 255 248 236 3% (10%)
Other biopharmaceuticals 56 62 61 67 67 (16%) (28%)
Biopharmaceuticals total 713 765 696 718 672 6% (8%)
Sales by geographic segment:
North America Operations 2,206 2,279 2,139 2,230 2,139 3% (11%)
- USA 2,126 2,191 2,050 2,154 2,062 3% (11%)
International Operations 2,240 2,139 2,059 2,000 1,934 16% 0%
- Region Europe 864 855 816 791 748 16% 0%
- Region AAMEO 479 483 461 452 424 13% (2%)
- Region China 500 397 401 386 438 14% (1%)
- Region Japan & Korea 208 248 230 232 210 (1%) (14%)
- Region Latin America 189 156 151 139 114 66% 44%
Segment operating profit:
Diabetes care and obesity 1,640 1,229 1,472 1,586 1,522 8% (7%)
Biopharmaceuticals 415 375 432 392 409 1% (12%)
1) Comparative figures have been restated as sales of bulk insulin is now disclosed as part of other diabetes care.
Financial report for the period 1 January 2018 to 31 March 2018 Page 27 of 29
Financial
Performance Outlook R&D Sustainability Equity
Financial
Information
Company announcement No 37 / 2018
APPENDIX 9: NON-IFRS FINANCIAL MEASURES (ADDITIONAL INFORMATION)
In this Company Announcement, Novo Nordisk discloses certain financial measures of the Group’s financial performance, financial
position and cash flows that reflect adjustments to the directly comparable measures calculated and presented in accordance with
IFRS. These non-IFRS financial measures may not be defined and calculated by other companies in the same manner and may thus
not be comparable with such measures.
The non-IFRS financial measures presented in the Company Announcement are:
• Sales growth in local currencies
• Operating profit growth in local currencies
• Free cash flow
Sales and operating profit growth in local currencies
Growth in local currencies’ means that the effect of changes in exchange rates is excluded. It is defined as sales/operating profit
for the period measured at the average exchange rates for the same period prior year compared with realised sales/operating
profit for the same period prior year. Countries with hyperinflation as defined in IAS 29 ‘Financial reporting in hyperinflation
economies’ are excluded from the calculation to avoid that growth in local currencies are artificially inflated. Management
believes that growth in local currencies is relevant information for investors in order to understand the underlying development in
sales and operating profit by adjusting for the impact of currency fluctuations.
Sales in local currencies
DKK million Q1 2018 Q1 2017
Net sales 26,930 28,452
Effect of exchange rate 3,006 (450)
Sales in local currencies 29,936 28,002
Operating profit in local currencies
DKK million Q1 2018 Q1 2017
Operating profit 12,448 13,490
Effect of exchange rate 1,880 (458)
Operating profit in local currencies 14,328 13,032
Free cash flow
Novo Nordisk defines free cash flow as ’net cash generated from operating activities’ less ‘net cash used in investing activities’
excluding net change of marketable securities. A positive free cash flow shows that the Group is able to finance its activities and
that external financing is thus not necessary for the Group’s operating activities. Therefore, management believes that this non-
IFRS liquidity measure provides useful information to investors in addition to the most directly comparable IFRS financial measure
‘Net cash generated from operating activities’.
Free cash flow
DKK million Q1 2018 Q1 2017
Net cash generated from operating activities 9,815 12,098
Net cash used in investing activities (2,574) (692)
Net purchase of marketable securities — (1,006)
Free cash flow 7,241 10,400
Financial report for the period 1 January 2018 to 31 March 2018 Page 28 of 29
Financial
Performance Outlook R&D Sustainability Equity
Financial
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Company announcement No 37 / 2018
APPENDIX 10: NEW ACCOUNTING STANDARDS IN 2018
As of 1 January 2018 Novo Nordisk applies, for the first time, IFRS 9 ‘Financial Instruments’ and IFRS 15 ‘Revenue
from Contracts with Customers’. As required by IAS 34, the effect of the implementation are disclosed below.
The impact of the implementation of IFRS 9 and IFRS 15 has been immaterial in relation to recognition and
measurement.
Effect from IFRS 9
The implementation of IFRS 9 'Financial instruments' that replaces IAS 39 'Financial Instruments: Recognition and
Measurement', has had the effect that the changes to the fair value of minor shareholdings are now, on an
investment-by-investment basis, either recognised in the Income statement or Other comprehensive income.
Changes in the fair value of current minor shareholdings are recognised in the Income statement. Previously fair
value changes were recognised in Other comprehensive income. Furthermore hedge accounting is applied for the
time value of currency options (open at closing date).
Novo Nordisk has implemented these changes using the prospective approach. The effect on the financial
statements is specified in the table below.
31 March 2018
DKK million
Previous
accounting
practice
Effect from
change of
practice
New accounting
practice
Income statement — 72 72
Statement of other comprehensive income 72 (72) —
Equity statement1) — — —
1) As a result of changed accounting practice DKK 90 million is moved from other reserves to retained earnings within equity as an adjustment
to opening equity 1 January 2018.
Effect from IFRS 15
The group has implemented IFRS 15 'Revenue from Contracts with Customers' using the modified retrospective
approach. IFRS 15 replaces the current standards on revenue (IAS 11 'Construction Contracts' and IAS 18
'Revenue').
There is no significant effect on the financial statements.
Financial report for the period 1 January 2018 to 31 March 2018 Page 29 of 29
Financial
Performance Outlook R&D Sustainability Equity
Financial
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Company announcement No 37 / 2018