COPENHAGEN, Aug 18 (Reuters) - Novo Nordisk A/S said on Monday it had accepted a near $90,000 fine from Danish regulators for failing to inform investors quickly enough that a drug it had hoped would become its next growth driver had been refused U.S. approval.
The news that the Food and Drug Administration (FDA) had rejected Tresiba, a treatment for diabetes, and a related combination drug called Ryzodeg, was a major blow to Novo Nordisk and surprised investors expecting a green light.
Novo had issued a statement to investors on Sunday Feb. 10, 2013, having been told of the FDA ruling on the previous Friday. Its shares plummeted by as much as 17 percent the following Monday, their biggest daily decline since 2002.
Although the FDA news came after the Danish market was closed, it was still possible to trade Novo shares over the counter and through banking systems. Trading in Novo’s American depository receipts was also still active.
The Danish Financial Supervisory Authority (FSA) said Novo should have issued a statement on the Friday evening.
The company had long argued it needed time to analyse the FDA’s decision, which was not an outright rejection of the drug. On Monday it said it still believed it did the right thing.
“However, for resource reasons, Novo Nordisk’s management has chosen to accept the fine to avoid a lengthy lawsuit. This will finally settle the case,” it said in a statement.
Novo said earlier this month it now expects to launch Tresiba in the United States at the start of 2016, should the FDA approve it after further tests. It expects to submit for approval in mid-2015.
Novo will pay 500,000 Danish crowns ($89,763). Fines for disclosure violations are typically in the range of 50,000 to 200,000 crowns, according to the FSA. Novo Nordisk earned 25.2 billion crowns net profit last year.
1 US dollar = 5.5712 Danish crown Reporting by Shida Chayesteh; Editing by David Holmes