COPENHAGEN — Novo Nordisk, the Danish drugmaker behind the blockbuster weight-loss treatment Wegovy, is cutting 9,000 jobs in a dramatic move to streamline operations and sharpen its focus on obesity and diabetes drugs amid mounting competition.
The layoffs, which will affect about 5,000 workers in Denmark, are part of a sweeping restructuring expected to save 8 billion Danish crowns (US$1.25 billion) annually. At the same time, the company issued its third profit warning of the year, citing 9 billion crowns in one-off restructuring costs.
The move marks the first major decision under new CEO Mike Doustdar, who took the helm last month. He said the overhaul is aimed at simplifying operations, speeding up decision-making, and reinvesting in research, manufacturing, and patient access, rather than simply boosting profit margins. “Sometimes the hardest decisions are the right ones for the future we’re building. I’m confident this is the right thing to do for the long-term success of Novo Nordisk,” he wrote on LinkedIn.
Novo’s star rose rapidly after Wegovy’s U.S. approval in 2021, which made it the first highly effective obesity drug on the market. But its rapid hiring spree — which nearly doubled headcount over five years — has now reversed course as demand cools and rivals gain ground. Eli Lilly’s Zepbound overtook Wegovy in U.S. weekly prescriptions earlier this year, although Wegovy prescriptions have begun to pick up again this summer.
Shares in Novo, once Europe’s most valuable company with a peak valuation near $650 billion, have lost nearly half their value this year, now sitting around $181 billion. Investors wiped $70 billion off its market capitalization in July after a profit warning and leadership shake-up.
While some analysts praised Doustdar’s willingness to “cut the fat,” others warned the layoffs may not fully reassure shareholders. “The obesity market was misjudged. It’s much more consumer-driven than anticipated, and Novo expanded organizational complexity too quickly,” said Lukas Leu, portfolio manager at ATG Healthcare.
Novo Nordisk expects operating profit growth in 2025 to range between four and ten per cent, a sharp drop from its earlier forecast of 19 to 27 per cent. The company is also preparing a pill version of Wegovy and exploring new applications for its GLP-1 drugs, hoping to regain momentum in a market that remains fiercely competitive.