General presentation of the Novo Nordisk Company:
Still with the objective of increasing your knowledge about Novo Nordisk we will now present information about this company with details pertaining to its activities and sources of revenue that will assist you in better understanding the challenges it faces and its possibilities for growth.
Novo Nordisk is a Danish company specialised in the creation, production and sale of pharmaceutical products. To better understand its activities we can divide them into a number of sectors according to the turnover they generate and how they do so:
- The production and sale of treatment products for diabetes and obesity that represent the majority of the group’s income and generate nearly 84.3% of its turnover.
- In second position we find the activities related to haemophilia treatment products that generate 8.4% of the group’s turnover, notably with the protein injections.
- Then we have the production and sale of growth hormones representing 6% of the turnover of this company which are destined for children that require growth deficiency treatment.
- And finally we find the hormonal substitute products including those for menopause and osteoporosis prevention that represent 1.3% of the company’s turnover.
It can also be advantageous to know the geographical distribution of this company’s income. In fact, 19.1% of its revenue is currently generated in Europe, 47.1% in the United States, 2.5% in North America, 11.5% in Africa, the Middle East and Oceania, 10.5% in China, 5.3% in Japan and Korea and 4% in Latin America.
Know the competition to Novo Nordisk shares:
We shall now pass on to a study of the Novo Nordisk Company relating to its principal competitors on the market. Here are details on the major direct competitors to the Eli Lilly Group, four in number at present:
- Eli Lilly: This is an American pharmaceutical group that holds tenth position worldwide in terms of turnover. Based in Indianapolis, Indiana, this company was created in 1876 by the Colonel Eli Lilly, a pharmacist and veteran of the war of succession who died in 1898. The Eli Lilly Group currently employs more than 33,600 people around the world in 143 countries. The group owns numerous production sites the largest of which are in France.
- Astrazeneca: This is another pharmaceutical group created through the merger of the Swedish company Astra and the British company Zeneca in 1999. The group currently employs approximately 63,000 people around the world and exercises its activities in the sectors of research, development, production and sale of pharmaceutical products as well as the provision of services for medical care. Astrazeneca is particularly specialised in certain therapeutic sectors including diabetes, anaesthesiology, cardiology, infectious diseases, gastroenterology, oncology, neurology and pneumology.
- Biocon: Another serious contender to Novo Nordisk is the Biocon Company which is an Indian biotechnology company based in Bangalore. It is notably specialised in the sectors of enzymes, oncology, and the production of insulin.
- Abbott: Finally, the last direct major competitor to Novo Nordisk is the American company Abbott Laboratories, a pharmaceutical company based in Chicago which currently employs nearly 90,000 employees worldwide.
The strategic alliances implemented by the Novo Nordisk Group:
Of course, the Novo Nordisk Group does not only have adversaries, it also has a number of allies such as the following two examples of partnerships that the company recently signed:
- Innate Pharma: Firstly, in 2006 Novo Nordisk signed a partnership agreement with Innate Pharma for the research and development of medicinal products targeting the Natural Killer cells.
- Remynd: In 2017 Novo Nordisk allied itself with the Belgian company Remynd in a license agreement for the development of a major therapeutic treatment related to diabetes.
The factors in favour of a rise in the Novo Nordisk share price:
Before deciding which strategy to adopt for Novo Nordisk shares read the following information on the advantages and disadvantages of this company.
We shall start with the advantages of this group with the following examples:
- Firstly, the group benefits from a profound knowledge of diabetes and over time the company has become a specialist in this illness.
- Another advantage of this group relates to its significant cash flow that can be used to achieve acquisitions, spread throughout the world and undertake further research and development.
- The international position of the group is also one of its major strengths as it is present in 190 different countries.
The factors in favour of a drop in the share price of Novo Nordisk:
Let us now pass on to the disadvantages of this asset and detail a few weak points of this company:
- Firstly, the Novo Nordisk Company has been targeted by critics following its inability to supply information relating to the side effects of Victoza which tarnishes the brand’s image.
- Finally, other legal actions in the past that the group has experienced continue to blemish this brand’s reputation and negatively influence this group’s activities.