Novo confident insulin Tresiba will get U.S. approval-chairman

Fri Mar 8, 2013 9:23am EST

* Novo chairman says U.S. approval of Tresiba a top priority

* Says stock split not currently on the agenda

* Says company exploring an increase in dividend

By Shida Chayesteh

COPENHAGEN, March 8 (Reuters) - Denmark's Novo Nordisk , the world's biggest insulin producer, is confident U.S. authorities will approve its new long-acting product Tresiba, its incoming chairman said on Friday.

U.S. regulators last month unexpectedly refused to approve Tresiba until the group conducts extra tests for potential heart risks, dealing a blow to one of its key products as well as to its share price.

The drugmaker shed about $14 billion in market value on Feb. 11 after the decision by the U.S. Food and Drug Administration (FDA) was published, although the shares have since recovered much of the fall.

Goran Ando, who will take over as chairman of the board at Novo Nordisk after the annual general meeting on March 20, told Reuters that getting Tresiba approved by the FDA is one the most important short term goals for the group.

"I have all the confidence in the world that we will do that," Ando said in an interview, without going into further details.

"It will take more time than we thought but we will get there," he told Reuters, adding the board was surprised by the FDA's decision last month.

Most investors had expected a green light from the U.S. watchdog, following a positive recommendation from an advisory panel to the FDA last November, despite earlier signals that there might be heart issues with the medicine.

There has been speculation about a potential stock split as Novo's share price has exceeded 1,000 Danish crowns and the outgoing chairman said in January that approval of Tresiba in the Unites States was a condition for a decision to proceed.

Asked about prospects for a stock split, Ando said: "It is nothing that is currently on the agenda."

He added the board would look into increasing dividends.

"I don't think you will see very dramatic changes. But we will look at this," Ando said.

In January, Novo had raised its sales and profit forecasts for 2013 on hopes that Tresiba, also known as degludec, would soon win approval in the United States and add momentum to surging profits.

But following the FDA decision the drugmaker, which is banking on Tresiba to keep it in the lead in diabetes care, has said the earliest it could provide the data requested by the U.S. authorities is in 2015.

As the world suffers from an epidemic of type 2 diabetes tied to over-eating and lack of exercise, demand for treatments has snowballed. Novo has benefited more than any other company because it is so focused on diabetes, lifting its shares to a lofty premium over other European drugmakers.

COMFORTABLE WITH DIABETES FOCUS

That strategy was not set for any major change under the new chairman.

"Is there a reason to change the fundamental things, I don't think so," Ando said.

"I am very comfortable with our focus on diabetes," he said.

The global diabetes market should grow 10 percent annually through 2020, Citigroup estimates, as Western lifestyles are adopted in emerging markets and obesity affects U.S. citizens at ever-younger ages.

Ando said rising competition would present challenges.

"It is a challenge to continue to grow as fast as we have done," he said.

"In the overall diabetes arena, I think it is fair to say that competition is increasing."

Novo Nordisk has overtaken Norway's Statoil as the Nordic region's biggest company by market capitalisation, dominating its home stock market which last month changed the benchmark, from next week, to a new index that caps Novo's weighting at 20 percent.

Shares in Novo Nordisk traded flat at 1,003.00 crowns per share at 1345 GMT, against a 0.5 percent rise in the Copenhagen stock exchange's benchmark index.

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