COPENHAGEN Shares in Denmark's Novo Nordisk fell as much as 5 percent on Friday, after a U.S. expert panel assessing the group's ultra long-acting insulin degludec said it will study the cardiovascular safety of the drug.
The statement late on Thursday raised a potential obstacle to approval of the drug, which Novo plans to market under the brand name Tresiba, in the world's top market ahead of the panel's meeting on November 8.
"People are nervous that Tresiba might not be approved as a product," said BankNordic senior portfolio manager Niels-Henrik.
DNB Markets said in a note to clients it still believed the drug would be approved in the United States.
"Novo will most likely have to carry out a post approval study to address cardiovascular safety," DNB said.
"However, the risk of the FDA (Food and Drug Administration)asking for additional studies ahead of approval has increased," DNB said.
Thursday's statement from the expert panel has raised concerns that degludec's benefits might not outweigh its potential risks in the eyes of U.S. regulators, who have already delayed a decision on the product.
Any setback for degludec would be good news for rivals Sanofi and Eli Lilly.
The insulin was recommended for approval by the European Medicines Agency last week but the U.S. decision is seen as pivotal, since this is where the bulk of future sales are expected to be generated.
Shares in Novo Nordisk partially recovered from an initial 4.7 percent drop when market opened to trade down 3 percent at 0807 GMT, against a 0.4 percent fall in the European healthcare index and a 1.6 percent fall in the Copenhagen stock exchange's benchmark index.
(Reporting by Mette Fraende and Ben Hirschler, additional reporting by Shida Chayesteh; Editing by Erica Billingham)