Novo reports weakening diabetes sales in China
Novo Nordisk A/S (CSE:NVO; NYSE:NVO) reported earnings and said China sales declined 6% in 2Q15 compared to 2Q14, as measured in local currencies. On a conference call, CEO Lars Sorensen acknowledged a decline in the overall growth rate of China's diabetes care market; the country has the world's largest diabetes population. The company also said the timing of its shipments to distributors contributed to the slowdown. China sales grew 3% overall in 1H15, compared to 17% growth in 1H14.
Novo said cost-containment measures in China's healthcare system were to blame, including restrictions on access to healthcare professionals and increasing competition from local insulin manufacturers in provincial tenders. On the call, Sorensen said the company is "getting slapped from two sides" in China as it competes with Lantus insulin glargine from Sanofi (Euronext:SAN; NYSE:SNY) and locally produced therapies including locally manufactured human insulin and a biosimilar of Lantus. ...