Q2 2025 Novo Nordisk A/S Earnings Call
Good day, and thank you for standing by. Welcome to the Q2 2025 Novo Nordisk earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press *1 and then 1 on your telephone. You will then hear an automated message advising that your hand is raised. To withdraw your question, please press *1 and then 1 again. Please be advised that today's conference is being recorded. I would now like to turn the conference over to your first speaker today, the Head of Investor Relations. Please go ahead.
Thank you. Hello, everyone, and welcome to this earnings call for the first half of 2025.
My name is Jacob and I'm the head of investor relations. And with me today, I have CEO of know, for and portfolio strategy with Healthcare.
Executive Vice President of U.S. Operations, David Moore, Executive Vice President and Head of Development, Martin Lange.
Chief Finance Officer of Customer Inclusion, and finally Executive Vice President of International Operations, as well as incoming CEO. As of August 7th, Mike D.
all speakers will be available for the Q&A session.
Today's announcement and the slides for this call are available on our website, no.com. Please note that the call is being recorded live, and the recording will be made available on our website as well.
The call is scheduled to last 1 hour.
Please turn to the next slide.
The presentation is structured as outlined on slide 2. Please note that all sales and operating profit growth statements will be at constant exchange rates unless otherwise specified.
Next slide, please.
We need to advise you that this call will contain 4 forward-looking statements. These relate to strategy, risk, and uncertainty that could cause actual results to differ materially from expectations. For further information on the risk factors, please see the Company announcement for the first 6 months of 2025, as well as the slides prepared for this presentation.
And with that over to you last for an update on our strategy isolations.
Thank you. Yup. Next slide, please.
In the first six months of 2025, we delivered 18% sales growth and 29% operating profit growth.
As announced last week, Bhronos has lowered the full-year outlook for 2025, compared to the outlook issued in May of this year.
The change in sales outlook for 2025 is driven by lower growth expectations for the second half of 2025. This is related to lower growth expectations for the U.S. obesity market.
Lower growth expectations for diabetes in the U.S. G, if we want diabetes marked as well as lower than expected presentation, for we go in select IO markets.
Customer will come back to this later in the call.
I would like to go through the performance and highlights across our strategic aspirations before handing over the word to my colleagues.
Starting with our focus on purposes with sustainability, we are now serving almost 46 million patients without diabetes and obesity treatments. This is an increase of more than 3.5 million patients compared to the first 6 months of 2024.
In Andy Osmek, received a positive opinion by the EMA for the treatment of peripheral arterial disease in people living with type 2 diabetes.
Technical development.
Further, we initiated a new phase 3B trial redefined 11.
The trial lasts for 80 weeks and investigates further potential deficiency and safety of Kasma.
Finally, we have entered an exclusive collaboration and license agreement with SEPTA to discover and develop all small molecules for the treatment of obesity, type 2 diabetes, and other culture metabolic diseases.
Now, I would like to turn all the work to Ludovic but update on our commercial execution in the first six months of 2025.
Thank you, Laura, and please turn to the next slide.
In the first 6 months of 2025, our total sales increased by 18%. The sales growth was driven by both operating units: U.S. operations grew 17% and international operations grew 19%.
Sales growth in the first six months of 2025 was positively impacted by growth in net sales and adjustments related to prior years.
Our glp1 sales in diabetes increased by 10%.
Driven by us operations.
Growing 9% and international operations, growing 10%.
Sales growth in the U.S. includes adjustments related to the 340B provision of around $3 billion DKK in the second quarter of 2025.
Incident sales increased by 4%, driven by U.S. operations growing 17%. The sales increase was driven by gross energy, adjustments related to prior years, as well as channel and payer mix, partially countered by a decline in volume. International sales opportunity sales decreased by 1%.
Obesity care sales increased 58%, driven by U.S. operations growing 36% and international operations growing 125%.
The volume of compounding GLP-1s in the U.S. is estimated to have impacted the uptake of Wegovy prescriptions.
As well as the growth of the branded obesity market during the first half of 2025.
Please turn to next slide.
Our rare disease sales increased by 15%, driven by a sales increase in the U.S. operations of 23% and international operations of 10%.
Says a random crime disorder products increased by 49%, driven by an Audi Tropin and Soya launch uptake across the U.S. and internationally. As a reminder, in 2024, sales of Knee Tropin were negatively impacted by a reduction in manufacturing output, which has now improved.
Red blood disorder sales increased by 6%, driven by an increase in sales of NovoSeven and a limit in the U.S. and higher in theia B and a limit sales in international operations. And with that, I'll hand over to today.
Thank you, Ludo. Please turn to the next slide.
Sales of GLP-1 diabetes care products in the U.S. increased by 9% in the first six months of 2025.
The sales increase was driven by continued uptake of Olympic, partially countered by the Rebels.
Osmek sales in the US were positively impacted by gross, in net sales, adjustments related to Prior years.
The weekly Ozempic prescriptions are currently around 690,000 in standard units.
While the full impact of the chronic kidney disease indication has yet to be fully realized, this indication allows us to reach additional patient segments within the type 2 diabetes population.
And we will continue to invest in commercial activities and label updates towards driving further market penetration.
This includes Ozempic in the cash channel, which we anticipate launching later this year.
Please go to the next line.
We expect sales to increase by 37% in U.S. operations in the first six months of 2025.
The Govi sales growth was driven by increased volumes, partially countered by lower realized prices.
And you see that GOI has around 280% prescriptions.
As Ludo said, despite the expiration of the FDA grace period for mass compounding on May 22nd,
Neuville Nordic market research shows that unsafe and unlawful mass compounding has continued.
Entities, continue to Market and sell compounded. Glp ones under the false guise of personalization and it is estimated to be around. 1 million patients are on compounded, glp1 in the US.
Novo Nordisk is working to prevent unlawful and unsafe compounding of Seaglide in the U.S. while ensuring patients have access to safe, legitimate Seaglide produced only by Novo Nordisk.
As unsafe and unlawful. Mass compounding continues; the penetration within the cast channel has been lower than expected.
Noble Nordis launched NovaCare Pharmacy in March 2025, and the penetration of AGOI within the cast channel is now around 10% of total prescriptions.
Nova Nordisk will continue to invest in the expansion of direct-to-patient initiatives.
Including NovaCare Pharmacy as well as tea health collaborations.
Within the insured channel, Noon notice expects a volume contribution from changes to the CVS National template formula.
This went into effect on July 1, 2025, where we GOI is. Now the only GLP-1 medicine covered for obesity.
Although compounding persists, we do see positive early indicators in recent weeks, a prescription data that we believe is driven by CVS formula decision as well as recent commercial efforts.
We remain focused on driving commercial execution, which includes refining our messaging.
Launching new initiatives and pursuing additional indications over the course of this year.
Our most recent would be direct to Consumer campaigns highlight, real world evidence that was presented at the Ada meeting in June with additional campaigns planned for the second half of the year.
Furthermore, we can continue to anticipate a regulatory decision regarding the Budovy Mash indication.
in the third quarter of 2025,
Now, I will turn it over to you, Mike, for an update on international operations.
Thanks tape next slide, please.
Sales in IO grew by 19% in the first 6 months of 2025, driven by GOP 1 products. GOP 1 diabetes sales increased. This growth was negatively impacted by periodic supply movements.
Our glp1 diabetes cells in region China was also lower than expected. Mainly because of the wholesaler inventory, movements and timing. Having said that obesity care sales, grew in Ayo by a very strong percentage, we grew the sales by 125% to 13.9 billion Decay. And if you discount for saxenda and look at the sales at Govi alone, we have now reached more than 12.2 billion DKK growing at an impressive rate of 335% by all the regions, please go to the next slide.
No. 1 Nordic remains the market leader in IO with a total diabetes and obesity GLP-1 volume market share of 71%. Simply put, almost three-quarters of people who use our GLP-1 products in IO are on a Novo Nordisk GLP-1 product.
With improved supply for both osmek and V GOI and connected to that, increased Investments and higher Innovation, higher activations of commercial activities. We will um, accelerate our launches and further Advance our glp1 leadership.
rebalances is also available right now in 40 countries and will continue to gain market, share in international operations, meanwhile,
Osmek remains the leading GOP-1 diabetes product within IO, having launched in around 80 markets.
As supply has started to increase, stores in IO markets are now all in with our promotional activities to further expand the number of patients that we are reaching.
That also includes an increased online presence and health collaborations in our markets.
To the EMA in July.
The growth of the Govi in IO is very encouraging, but there are still millions of people with obesity who need our medications, and we need to get to them soon.
We will continue rolling out the GOI in more countries during the second half of this year. Now, over to you, little.
Thank you, Mike. That's right. And please turn to the next slide.
As you've heard from Dave and Mike, there is much work to be done. When it comes to reaching the millions of people worldwide living with diabetes—over 550 million people live with type 1 and type 2 diabetes globally—and over 900 million people live with obesity. In both cases, most of these people reside outside of the United States.
Despite the prevalence of diabetes and obesity. More effort is required to help people get our Innovative medicines in diabetes. As an example through a though, a patient can have more than 1 prescription only 7% of total. Estimated prescriptions are of a glp 1.
Furthermore, less than 1% of people with a bossy globally are treated with branded entire basicity medications. This, of course, means that there is a vast unmet need that is yet to be addressed.
Our goal is to gradually expand the diabetes and obesity markets, reaching new patient groups and new physician segments.
We also work to introduce new channels and treatments and reduce barriers to access so that our innovative treatments and devices can get to patients who need them.
Please turn to the next slide.
As an example, and in continuation thereof unlocking the full potential of the obesity market requires addressing diverse patient segments through a broad and strategically aligned portfolio of treatments.
The obesity market today, in terms of weight loss, is substantial in magnitude. And of course, we respond to that need. However, we will widen the scope of our medicines and ensure greater relevance across varying BMI categories and patient preferences.
Our portfolio reflects this diversity, targeted at offering both subcutaneous and oral delivery, and addressing core morbidities associated with obesity. This includes atherosclerosis, heart failure matched with fibrosis, and also arthritis.
With these differentiated treatment goals, whether patients desire rapid weight loss or rather gradual progress supported by tolerability and safety, Novo Nordisk remains focused on providing solutions to current and future segments.
And now, over to Martin for an update on R&D.
Thank you, Luro. Please turn to the next slide.
I would like to start with a brief reminder of the Imitation, Phase 1B/28 data which we presented at the ADA.
and in addition to the next steps for the compound,
The primary endpoint of the Phase 1B/2A trial.
With subcutaneous and Cretin and people with overweight or obesity, was treatment, uh, emerging adverse events.
Overall, the trial demonstrated that the safety profile for creating was consistent with increasing-based therapies.
The most common adverse events for them were recreational or gastrointestinal, and the vast majority were of mild to moderate severity.
People treated within the dose dependent uh sorry in the dose response, part of the trial achieved an estimated body weight loss of 9.7%.
16.2% and 22% after a 12-week maintenance period.
This was in the 1.25 mg, 5 mg, and 20 mg doses, respectively.
In the multiple ascending dose part of the trial, people on the 60 microgram migrogtes achieved an encouraging estimated body weight loss of 24.3% at 36 weeks.
Overall, we are very encouraged by the Phase 1 B2A, speaking to the potential of emit.
Both on efficacy and on tolerability ability.
After an end of Phase 2 discussions with the regulatory authorities, we are now looking forward to initiating a broad Phase 3 development program with EMR for adults with overweight, obesity, and associated comorbidities.
Next slide, please.
The comprehensive Phase 3 development program will be called The Maze, and we'll start at the beginning of 2026.
The subcutaneous and oral routes of administration, as well as several obesity-related comorbidities.
For example.
Atherosclerotic cardiovascular disease, heart failure, chronic kidney disease, New York, arthritis, and obstructive sleep apnea.
With the plans to investigate additional comorbidities as well.
We're excited about the potential that Emic and Holds, and the Amaze program will be key to unlocking this potential.
Next slide, please.
Turning to the upcoming R&D milestones, we are looking forward to the remainder of 2025 with a number of readouts and milestones.
However, before speaking to this, I would like to highlight a few milestones from the past few months.
With obesity, we have initiated the redefined 11-phase free trial, Recycle Summer, to investigate further weight loss potential by exploring those Reis and longer trial duration.
Further, we have submitted some manual type 7.2 mg for approval within the EU.
Looking ahead, we also anticipate the internal triple GP1 GIP ambulance Phase 1 readout that will guide us for potential further development into Phases 1B and 2.
Within diabetes, as last noted, we received a positive EMA opinion regarding the Ozempic label update for treating peripheral arterial disease in people living with type 2 diabetes.
This supports the accumulating evidence of cardio-metabolic benefits for semaglutide 1.0 mg in people living with type 2 diabetes.
Notably, the magnetite 1.0 mg has demonstrated a 24% risk reduction in the risk of kidney disease-related events in the FLOW trial.
And cardiovascular risk reduction of 26% in the sustained, 61, which is unsurpassed in the increase in space.
This seems to corroborate what we have been discussing for the last couple of years, namely that magnetite appears to be unique in driving the magnitude of cardiovascular benefits in the class.
In addition, in diabetes, we are awaiting the readout of the rematching free trial investigating the potential of Kagra in diabetes.
We also anticipate the phase 2 results of the subcutaneous and all-emitting inside type 2 diabetes.
Within radices, the FDA has now approved Alejo as a once-daily prophylactic treatment to prevent or reduce the frequency of bleeding episodes.
The label covers adults and children 12 years of age and older with hemophilia A or B without inhibitors.
We also received a positive opinion from the EMA regarding our enema.
Lastly, in REDS, we expect to file my mate for hemophilia A approval in the US and in the EU in the second half of this year.
Within cardiovascular disease, an emergency therapy areas. We are excited to have submitted the essence part 1 data. With Once weekly, the medical side, 2.4 milligram for regulatory approval in Japan for the treatment of mesh.
We also anticipate a U.S. decision, or that we go in mesh indication, later this quarter.
In July, we success successfully completed a phase 2 trial with core Muk, and antibody designed to deplete ml or deposits in, uh, tra in transference, and amloid cardiomyopathy.
Detailed data expected to be shared at a medical conference later this year.
Following the successful completion of this Phase 2 trial, HCI Dopey is expected to initiate Phase 3 during the course of 2025.
Lastly, we look forward to the readout of the Evoke and Evoke Plus Phase 3 trials in patients with early Alzheimer's disease towards the end of this year.
While we are excited about the potential for the medical side in Alzheimer's disease, we must also highlight that this is a high-risk, high-reward opportunity. Uh, sorry, high risk, high reward, uh, opportunity with that over to your customer.
Thank you, Martin. Please turn to the next slide.
In the first 6 months of 2025, our sales group increased by 16% in Danish Kroner, and by 18% at constant exchange rates, driven by both operating units.
The gross margin decreased to 83.4% compared to 84% in 2024 and 84.9%.
The decrease mainly reflects monetization and depreciations related to cattle, as well as costs related to ongoing capacity expansions.
A positive product was driven by increased sales of GLP-1-based treatments.
Sales and distribution costs increased by 15% in both Danish kroner and at constant exchange rates.
The increase in cost is driven by both the US operations and international operations.
In U.S. operations, the cost increases are mainly driven by promotional activities related to the Go Win or Sick.
While in its national operations, the increase is primarily related to the go-ahead we launched and promotional activities.
R&D costs decreased by 11% in both Danish kroner, and a constant exchange rate decrease is driven by the impairment loss related to oid Duran of 5.7 billion Danish kroner and other impairments of intangible assets in 2024.
This is partly countered by increasing investments within obesity care and reflecting increased late-stage clinical trial activity, as well as increased early research activities.
Administration costs increased by 10% in dangerous Corona, and 11% at Carson exchange rates.
Operating profit increased by 25%, measured in Danish kroner, and by 29% at constant exchange rates.
While Epi increased by 16% measured in Danish Kroner and 19% at constant exchange rates.
Net financial items showed a net loss of DKK 1.4 billion compared with the net loss of DKK 530 million last year.
This primarily reflects financing costs related to the funding of the Catalan transaction.
The effective tax rate was 21.6% in the first six months of 2025 compared to 20.6% in 2024.
Net profit increased by 22%, and diluted earnings per share increased by 23% to 12 kronor.
and 49, ER,
Free cash flow in the first six months of 2025 was $33.6 billion, compared to $41.3 billion in the first six months of 2024.
The reduction in free cash flow is driven by increased capital expenditures, partially offset by higher net cash generated from operating units. Capital expenditure for property, plant, and equipment was 28.1 billion Danish kroner, compared to 18.9 billion Danish kroner in 2024.
This is primarily driven by investments in additional capacity for API production and fill-finish capacity for both current and future injectables and all products.
For 2025, the board of directors has decided to pay out an interim dividend of 3.75 krona per share, an increase of 7% compared to August 2024.
The interim dividend will be paid out in August this year.
We have returned DKK 36.5 billion to shareholders.
Mainly as dividends in the first 6, 6 months of 2025, please go to the next slide.
The updated financial outlook for 2025 was announced last week, where the key highlights and drivers were described in the company announcement and investor call.
Sales growth is now expected to be 8% to 14% at constant exchange rates, and operating profit growth is now expected to be 10% to 16% across exchange rates.
Sales and operating profit growth reported in Danish kroner is now expected to be 3% and 5% lower than at constant exchange rates, respectively, based on exchange rates from 31st of July, 2025.
The Lord says for 2025, it is driven by lower growth expectations for the second half of 2025.
This is related to lower growth, expectations for V Govi in the US, the obesity market for Simp, in the $1 diabetes market, as well as we GOI in select IO markets.
The updated guidance reflects several efforts already underway, as mentioned by Mike and Dave.
No one expects net financial items to show a gain of around 1.6 billion Danish kroner. This is mainly driven by anticipated gains on currencies, primarily the US dollar, partially offset by interest expenses related to the funding of the debt financing Catalan transaction.
The effective tax rate for 2025 is still expected to be between 21% and 23%.
Capital expenditure is still expected to be around 65 billion, Danish Corona in 2025, reflecting expansion of the global supply chain.
In the coming years, the capital expenditure to sales ratio is still expected to be in the low double digits.
Driven by lower volume growth of th1 treatment in the US.
That covers the remaining details on the outlook for 2025. Now back to you, last.
Thank you, Carson. Please turn to the next slide.
The performance in the first six months of 2025, with 18% sales growth, reflects nearly 46 million people who are now benefiting from our treatments. Further, we progressed our R&D pipeline, including initiating the CALCIMIMETIC Phase 3B trial, REDUCE-11, in people living with overweight and obesity.
We have reduced our full-year outlook compared to the guidance issued in May.
While we had to, while we have had to adjust expectation for the second half of 2025, the organization is clear on what it needs to do for a forward.
I'm confident that with Mike at the helm, Novo Nordisk is equipped to continue unlocking the potential to treat more people living with serious chronic diseases.
It is with that, I would like to share my gratitude to the board, my team, and all in your roles for allowing me to lead this incredible organization. I'll continue to follow orders, and I'm excited for the organization's next chapter. With that, I would like to hand over to Mike for final comments.
Thank you. Lars, please turn to the next slide.
As of tomorrow, August 7th, I'm excited to be taking over as President and CEO of Nova Nordisk.
As we shared last week, there have been additional changes to the executive management team that I would like to highlight now.
Marcos Schindler, Executive Vice President of Research and Early Development and Chief Scientific Officer, is retiring after 7.5 years at Novo Nordisk and 4 years in his current role.
Marcus has been instrumental in discovering and advancing early scientific innovation across our beautiful areas and technologies.
No. 1, notice that research and early development and development areas will be combined.
The new research and development organization will be overseen by Martin Lange, currently Executive Vice President of Development.
Martin has been appointed Chief Scientific Officer and will resume responsibility for Research and Development starting tomorrow, August 7.
At CSO and head of the unified R&D organization, Martin will leverage his deep scientific expertise, strong leadership, and long-standing experience at Novo Nordisk to ensure efficiency and continued innovation.
Will be focused on raising the Innovation bar, within diabetes and obesity bringing new and better medicines to patients with serious, chronic diseases.
Lastly, Emmy Larson, currently Senior Vice President of the Europe and Canada region, will succeed me and assume the responsibility of Executive Vice President of International Operations. Emil currently leads the region, which spans 40 countries and accounts for about 20% of Novo Nordisk's global sales.
I would like to congratulate Martin and Emil on their promotions and thank Marcus for his significant contributions and dedication to the company.
Lastly.
I would like to thank you, Lars, for your dedication and many years of service at Novo Nordisk.
I consider it a privilege to have worked under you.
For so many years, I appreciate your support in passing the responsibility over to me.
Looking ahead, we must act with greater urgency, building on our companies' strengths while sharpening our focus on commercial execution and operational efficiency.
By fostering Innovation and making thoughtful Investments. We will be having the greatest impact
And we can ensure steady progress together with that over to you. Jacob.
Thank you, Mike. Next slide, please. With that, we're ready for the Q&A. We kindly ask all participants to limit themselves to one or a maximum of two questions, including sub-questions.
Then we're ready for the first set of questions, please, Operator.
Thank you as a reminder, if you would like to ask a question, please press star 1 and 1 on your telephone keypad.
We will now go to the first question.
And your first question today comes from the line of Michael middle calvit. From TD Cowen. Please go ahead.
To support their marketing of so-called personalized glp1. Dosing are not clearly defined and that a broad Court decision may be needed to get this practice fully shut down across the country. 1 could even imagine the Supreme Court needing to weigh in. So my question is whether Novo has initiated any litigation that could possibly serve that purpose. Thank you.
And we'll start with the question on the CVS formula, please.
Yes, thank you. Mike for the question. Um, we are pleased, um, with what we're seeing so far, uh, on the CVS formulary, uh, conversion, um, that conversion is, is going, uh, according to plan at this point. Um, we we won't comment on on the specific number of lives and, and what the actual percentage of conversion is, uh, but to tell you that, uh, we are, we are seeing things that are largely, uh, in line with what we expected and, and, uh, and what was in the plans. Um, on the compounding side, um, thank you for that question as well. You know, this is something that, uh, as you heard in our remarks, uh, uh, in the beginning of the call, this is a priority, uh, for our company. This is a priority to protect patient safety. Uh, this is a priority to ensure, uh, that the laws, uh, are followed. And as we mentioned, as of May, 22nd compounding is
Is a legal in the US except for rare circumstances and the apis that are being imported into the US are illegal. Uh, and they are not coming from uh, approved facilities. Not to comment directly on any, uh, litigation. But I will let you know that there is there is nothing categorically that is off the table. You saw earlier this week that we we gave some more insight in terms of the legal actions that we are taking. Uh, and certainly um, our viewpoints on that are are Broad and we have updated uh, or or increased our, our recent dialogue, uh, with FDA and uh, and we will continue that that ongoing dialogue. Uh, and we continue to think that there should be pressure, that's put on these, these entities that are false advertising misleading patients with illegal API.
Thanks a lot, Dave, and also thank you to you, Mike, for the questions. With that, we'll move on to the next set of questions, please.
Thank you. Your next question comes from the line of Peter fedel from BNP pariba. Please go ahead.
Yeah, thank you. People don't BMP power but um, 2 for Mike. Please just, can we discuss China Mike before you move up to CEO just a little more detail. Um, just interested to know why there's been so much to stocking um, in Q2 and how confident, uh, you are about the, the growth Outlook in China, given the arrival of been their ex and magnitude next year. And then, secondly, I just wanted to come back to a question post to you on last week's called about the, you know, go forward. Strategy changes, you intend to make. Um, I mean, should we issue major changes in R&D focus and kind of push you, you know, what exactly you can do differently with respect to commercial strategy, that hasn't already been tried by the company uh year to date. Thank you.
Thank you, Pete, and for those 2 questions, I'll go to you to you Mike. Yeah, thanks very much peat. Let me let me start with China. Um,
Let me start by saying what it's not the reason for lower growth. Um, we are not losing market, share in China, actually, the opposite we're gaining market share. Um, we're um, we're basically as you know, a bit left alone with a competition is not yet present. Um, so, so that is not the reason for the lower growth as, as mentioned. Um, to us the reason for the lower growth I would say is 1 and a half things. The the 1 thing is
Comparing it to last year, where we are basically in anticipation of Viggo, we launch.
Build some large stocks we now, of course, need to make that adjustments for this quarter, so it's a timely events and that's what the the definitions be be behind the sentences, the half issue is that we need to accelerate the glp1 market growth. Both, I would say, still in diabetes, but but certainly also in obesity, um, we we know that, um, from our diabetes leadership and being in China for a long time that you start somewhere in the center and you reach your customers, then you need to start going into the broader China in covering tier 2 and tier 3 and tier 4 and um and and and we need to do that both offline as well as of course, nowadays online
For the future. Um, I am very, um, I'm very confident for China's future. And and the reason I am is because it it has huge amount of unmet need and and populations, that are within diabetes and obesity where we serve 200 million people, living with obesity 100 million people living with diabetes. Is what I get my confidence from and and then we have some of the best people the best team on the ground to to maximize on that.
Thanks for that mic for covering the the China question and there was a follow-up question in terms of a strategic building blocks. Yeah. So so I cannot give you much more than what I gave you last um last week because um because not much has changed and I'm I'm still you know, not the CEO I have 1 more day to go but I can repeat what I said last week Pete. Um we're going to focus more. We're going to focus more on diabetes and obesity. As this is our main core and has always been. And I have a belief that when you focus on anything more, you increase the speed, you increase the agility and you get more out of that, you know, as as we go forward. Um, I think I've been put into this um, position because um, because I execute and um, and and I out compete my competition at least in IO, I've done that and I plan now to do more of that for the rest of the company. So, execution, execution, execution is what we should also last time. And then when I think
About the future and the huge opportunities that we have. We need to be able to finance that and not follow behind the competition. To finance that, we need to reallocate and re-evaluate our cost base and really put the money where the growth is. So those are the three things I said last week, and they're still very valid today.
I think thanks a lot, Mike, and also thanks to you, Pete. Then we're ready for the next set of questions, please.
Thank you. Your next question comes from the line of satin Jane from Bank of America. Please go ahead.
I have two questions, please: one for Dave and then one for casting. So, firstly on the We Go, the recent TRX dynamics. You flagged in the presentation the Mobile Care contribution, just to follow up prior, any sense of how much the increase that five more is CVS?
So this is remaining on the line growth. I'm just trying to get a sense of how much more CVS has to go and what the growth rate looks like. I want to see the S-curve. This is done. That's the first question. The second question is, I guess a repeat of a question from Castle last week. Uh, it's on 26th pushes and pulls. If you want to provide some high level, I know you didn't last week, but if consensus is corrected dramatically or if there's a big share price shift, we wonder whether you wanted to assess whether you think we collectively are thinking about this correctly. Consensus has fallen out at about 9 to 10% sales growth. Thank you.
Thank you, Sachin, for those two questions. Uh, I'll give the first one to you, Dave. I think you covered part of it, firstly, but on CVS, and then also… no, please.
Yep, thanks for touching. Um, it's still early days with respect to to CVS, uh, and the conversion we have a couple of data points, uh, in July. Um, so most of those, uh, obviously show up in the, in the first case in mbrx. Uh, and as I mentioned, we're, we're, we're seeing that largely in line, uh, but there's, there's still, um, uh, data points to come. Right. And, uh, some time to go, um, the increases that we are seeing in our uptick, um, they are, they are partly due to CVS, but they're also partly due to our other commercial efforts. As I, I mentioned, uh, in the previous quarter, we have a new campaign that we launched and focused on on the weight loss of lovi, as as the, the primary message
Um, so it's a it's a mix of both. And then with respect to Noble Care, Pharmacy. We will continue to expand that channel. It is a focus for us. Certainly the early days of noble Care. Pharmacy have been impacted by the the continuation of compounding. Um, but we we think there's a real opportunity to continue to expand that channel. Uh, we are encouraged in terms of what we're seeing, you know, our our overall cash business. Uh and we think there's a there's certainly an opportunity to partner with more organizations uh tella health.
Included and other entities to expand the cash channel. Uh, and as I mentioned we will, we will in the second half of the year uh, be offering another product, which is ozempic, uh, in Noble Care, Pharmacy as well. Thanks a lot.
In the prepared remarks, we're looking into uh, 2 significant markets in diabetes and obesity, where our penetration with our current portfolio of products is is still very, very low. And, uh, what you saw in our reporting today. You, you saw 19% growth in international operations, it's a big portfolio of markets and and we are not even done in terms of rolling out in in all markets with with, we go as an example and g21 pin trading in diabetes, is also very low on a global scale.
So, uh, so we believe that we have a substantial volume opportunity, uh, with our current portfolio and and that's what will be continuing to drive on the basis of, uh, of what we're delivering this year. And and then like, any year that that pushes and pulls between, uh, new launches, like Ultima obesity and in, in the US, uh, build of of new channels cash channels in the US and elsewhere. And, uh, and and, of course, uh, then a few headwinds also eloe in in, in a few select markets in in, in Ajo and uh, and and to kind of size that in rough terms, as we've also done historically on on on, on on specific uh items uh of discretionary nature. Then our assessment on Eloise in the specific IO markets, uh, in terms of impact to group growth next year is to the tune of uh, of low single digits of group sales. So, uh, so so that's what we're looking into next year. But uh, but clearly for
On driving growth with our portfolio, and then continue. If we go, we launch as well as all semi in the U.S.
Thank you, Ken, and also thanks to you, Sin. With that, we're ready to move on to the next set of questions, please.
Thank you. Your next question comes from the line of Michael Nova from Nadia. Please go ahead.
Thank you very much, Michael Lord from Nadia, uh, maybe you can comment a bit on how you stand in terms of capacity. Also for accelerating, uh, IO also going into, uh, to next year because uh,
Of course there has been been lack of uh, of of capacity but the how you positioned now and and also in in the same question, obviously, how well positioned do you believe you are for a sort of a an expansive launch of uh of all same. Uh 25 milligrams for uh obesity.
And then just lastly, a small note to rebuild this. We've seen you sort of comment on a deep prioritization. Is that something that we should just factor in? Will that mean that the reporters will be more sort of flattish going forward?
Thank you. Michael, on the first question on capacity, I'll turn that over to your customer.
Yeah, Michael. Thank you for, for, for that question. I think that, you know, the, the best forward-looking indicator on capacity you can get, is, is our current run rates and, uh, when you look at, uh, at vovi in IO uh, yesterday compared to last year, it's it's up 4 times.
so uh so so we are scaling really fast in in terms of both the in Market penetration and number of launches and as to number of launches, uh if you just take over the last, uh, uh, roughly 6 months then uh, then we started the year in around 20 markets and, and now we're in around 35 market so and and still counting
So so the pace of launches is is is high in in in sales operations and you should expect that to continue to to to be the case.
And and then for, uh, for capacity on the all simmer for for obesity, uh, you should expect us to to launch that. Uh, come come next year, uh, in a, in, in the US, in a non-supply, restricted way.
And on the second question on Rebellious, meaning in the U.S., I'll turn it over to you, Dave.
Yeah, thank, thank you for that question. Uh, yeah, I I think you have it right Michael. The, the priority, uh, certainly is, is continuing to expand with osmek and then type 2 diabetes Market. Uh, the priority, uh, is with wi and the Obesity market. And as Carson mentioned, um, you know, with a mash launch coming up as well as uh the oral SEMA for obesity. So so I I think the the terms of you know, flattish Trends with Rebel's um, is really just a signal in terms of, you know, where our priorities are.
Emphasis, you know, on our commercial investments and execution in Ozempic and Mobi.
Okay, thank you very much.
Thank you, Dave, and thanks to you, Michael.
Man from BMO Capital Markets, please go ahead.
Okay, thank you so much for taking my question. I wanted to touch on one of your development assets. We noticed you discontinued your development of South Foreman in MASH. Can you walk us through kind of the rationale and what you saw in that trial to drive this decision? And do you still have interest in the FGF21 target? Thank you.
Ian, thank you for that question regarding cell phones. If you have 21 alternatives, you might... Yeah, absolutely. Thank you for the question. Um,
I think you've heard me talk before. We do not progress assets that are not differentiated in a meaningful way. We conducted a trial comparing Self, Fairman, or I have to turn 21, both in model therapy to semantical type, but also in combination with the medical side.
and we did not see, from an efficacy perspective.
A dramatic improvement, neither in monotherapy nor in combination, above and beyond what we know already now. So, magnetite can do, uh, in at 2 and 3 and actually also in FL.
This, lastly, speaks to the power of the symmetrical side. We have some very strong data from investors that are currently under FDA review. As you know, if they are granted priority review because of the data package,
Um, and we expect the readout of that, uh, this quarter.
Semester is is, is is difficult to beat in the space. Uh, it doesn't mean that we, we, we are necessarily done with the FJ FJ 21 biology, but specifically, um, in in in in a head-to-head comparison. It's it's, it's just didn't, uh, substantially differentiate from the medical science.
Thank you, Martin, and thank you for the question. Evan, let's move on to the next set of questions, please.
Thank you.
Your next question comes from Richard Foster from J.P. Morgan. Please go ahead.
Hi. Thanks for taking my questions. Uh, 1 question, just to, to follow up on on pricing? Uh, we talked a lot about volume in the second half but just the, the, the thoughts on the price. Um, uh, a little bit more on that, on that color. I know we covered it last week, but price around would be and, and a Zen pick in the in the second half and into 26 as well. Uh, and then secondly uh on uh the uh, just wondered if I could get your thoughts on surpass, cvot. Uh and how you think that will uh impact the comp competitive Dynamics, uh in the in the diameters Market with uh with the Zenit, thanks very much.
Thanks, Rod and Richard, for those two questions. First, on the pricing question, I'll turn it over to you first.
Yeah, thank you for that question, Richard. Uh, and as, as we've said, consistently, then uh, uh, do be careful in terms of, uh, working too much with the pricing on a quarterly basis, their fluctuations with the inventories at at all sales growth on it and and the likes. Uh, so what I would say is that, uh, that directionally when we talk about, uh, the go pricing, then uh, then the the price erosion is, is more skewed towards the second half of the Year Link Link linked to the fact that that we're building the cash channel. Uh and and hence as a channel uh mixed element to it. And uh and then we're also investing in uh in uh reducing friction in in the access. We we have in place where in the insured channel, so patients can get better access uh, to reimburse the Gobi in in the US Marketplace. So, um, more skewed to the second half in in terms of uh, price erosion.
But of course, something we do in a very disciplined, uh, thoughtful manner.
Absolutely. Thanks, Carson. And on the second question on, uh, compared to trial, I'll turn it over to you first in the duet, if anything little afterwards. Yeah, absolutely. Thank you for the question. Um, of course, we've only seen headline data, so it's difficult to go into details. Looking at the headline, however, uh, it was clear that based on the primary analysis,
To sabotage wasn't for, uh, to sorry, not inferior to, to legalize, which means, basically it did not demonstrate a benefit versus to Legal site to Legal site that in the rewind study. Demonstrated at 12% CV risk reduction versus placebo.
This, despite a better weight loss and better class. Number control, I remind you that site by comparison through sustained 6 has shown a 26% CV risk reduction, which is today on surpassed, in the in space.
So for CV benefit for all, also other comorbidities, the mango side appears to stand out at this point.
A little bit, it come from you. Oh absolutely. I think I think you're right. I think that we have with um with semaglutide and agent here that has an unsurpassed CV profile. And and of course, as we discussed earlier on um as this Market is expanding, we're going to have to Target new populations new groups of patients, new Physicians and it's extremely important to make sure that for those patients for which beyond the weight, the coid are important in their Journey.
We make sure that the quality of the CV quality and CV profile of the magnitude are being are being heard and that's true with um the endocrinologist. The GPS, the cardiologist, it's also true for those patients who decide maybe to learn by themselves which products they want to get and we have to make sure that this profile is is known and and and uh, and uh, renowned for for what it gives. I think it's actually a very
Uh, interesting and a validation of what texting Martin was saying all along: not all GLT ones are the same.
Perfect. Thank you, Luro. And also thank you to you, Martin, as well for the question. Richard, let's turn to the next set of questions, please.
Thank you. Your next question comes from the line of Martin Packoy from SEB. Please go ahead.
Yes, ma'am. Also, 2 questions, uh, Caston. First question are you on, on capex? Now that the that there's a little bit less, uh, gold in Northern, and it turns more to to Value case. And then it would be interesting to to hear your law, more long-term thoughts on on cash flow development. Uh, and that's of course capex which are very high right now where when should we actually spare expect a more maintenance level? And what kind of level are they actually looking at a very long, uh, term. Um, and then the second question, uh, Justin Dave also on the all we go we launched and and maybe already adjust a little bit about it, but the high now, there's a US decision in in, in Q4 according to, to your your table and uh, uh, how will that immediately be launched in the cash Channel and how important do you actually think that could change the trend of, uh, of the uptake in the in the C Channel?
Yeah, so, uh, thank you for that, uh, question Martin. And, uh, and and and uh, the level of capex we're pursuing, is, is uh, directly. A function of the opportunity. We see in unmet need, I was talking to before, uh, and and both diabetes and obesity as well as our other assets. That, that
We're investing into. So, uh, so I would say in, in terms of of, uh, Capital At Risk, I, I do believe that we're investing in the core of the company, uh, and, and to the long term, both marketed as a, as well as, as pipeline assets.
And and then in terms of of the shape of the capex curve and and how uh, to get to a maintenance level and uh, uh and the magnitude of of that, then I, I would say that uh, that uh, we actually starting to see some of our uh uh bigger capex project announcements in in API uh getting getting very, very close to to delivering uh, to Market and and and to to regulatory approval. So so of course that then ties into, you know, the spending of those projects coming down. So uh but then we have still finished projects uh that are, you know, slightly delayed compared to that. So uh, so I would say we are, we're fairly close to to the peak, uh, and, and, and then, as as we, you know, conclude on on the assets that then you'll see a gradual decline. I won't guarantee from next year, but but, uh, but, but we're getting close to it, at least.
And then, for the maintenance level of capex.
Then, at least what, what? We've seen historically. Then then the maintenance level, uh, has has been around 5% to to sales capex to, to sales.
And and, and now we're in the low low double digits. Um, but uh, but but of course, hopefully capex, uh, will be higher uh, in in the case of uh, uh of uh, growth Outlook and and, and pipeline coming, uh, to fruition. But uh, but I would say on, on our peptide will finish, uh, platform with what we have, what we have going now, will be able to, to cater to, to, to many millions of of patients in in the coming decades. So, so we have a solid installed footprint, in in place there.
Was question 1 on the CapEx part? And for the second question, oral V in the US. Um, let's turn that to you today, please.
Yes. Uh, thank you for the question Martin. Uh, we are, uh, anticipating uh, the approval, as you mentioned, um, uh, towards the end of, um, of 2025, we are excited about this, uh, potential approval and launch. And as you can imagine, at this point Martin, all of the, the typical launch Readiness activities, uh, are fully underway, um, and, and our building momentum, uh, won't comment on on exact timing, uh, launched but, but certainly expect that, we will launch the product as close to approval as possible. Um, and having the organization ready to do that. Um, no specific comments on pricing strategy. Uh, however, since you mentioned it having a cash Channel option, uh, exists and uh, and that's different uh, in the way that we thought about launching products, uh, previously, uh, launching Novo Care. Pharmacy is a very long-term view, uh, from our perspective. And we think obesity, um,
Uh, products, uh, certainly lend themselves, uh, to the to the cash channel. So, uh, it's an option that we have and, and we certainly, you know, look forward to making sure that we can meet patients, you know, wherever they are in terms of their access needs, whether that's through insurance or, or, or other forms that we can make available to them. Thank you.
Thank you both, thank you for that.
Thank you for that Dave. And with that, we are approaching the turn of the hour so we're ready for the last set of questions, please.
Thank you. Your final questions for today come from the line of Emmanuel Papadakis from Deutsche Bank. Please go ahead.
Thank you for taking my questions. Um, maybe I'll come back to guidance if I meet for the second half of this year, even let alone next year. So now that we actually have the full set of Q2 results, perhaps you could just enlighten us on what set of assumptions would lead us to arrive at the bottom end of the range for this year in particular.
What assumptions did you make around the amount? For example and we'll go over your H2 to believe. We may have zero group Revenue growth in H2 and high single digits in this decline.
And then maybe a question on R&D for Martin. Thanks for the KGri Summer, single chamber update.
Um, you talked about further clinical development next year, but it's unclear—would a simple bridging stress study be enough to then bring that to the market, or would you actually acquire a full Phase 3?
And would successful development here enable you to make use of all your existing installed single chamber device manufacturing capacity? For example, can we go, or would you actually require?
Additional investments in new facilities for that device. Thank you.
Thank you, manual for those 2 questions on the first 1 on.
That Emmanuel, and, uh, let me be clear. So, uh, so so our guidance, we, we didn't build it, uh, for for, for the low end. Uh, so, so, so clearly we are closer to the center in, in terms of our base case, which is based on the trends. Uh, we are seeing in terms of script numbers, uh, as well as the Run rate in in Iowa, markets and and, and launches there. And now now we have the product and geography splits, uh, to, uh, beyond what you had last week. So, uh, so so that's our base case. And of course, everyone at at Novo, we're pushing to to deliver at least that. And, and hopefully, even more than that. And then, the reason why we have the guidance range and and the low range is, is basically to to cater for unforeseen events, uh, beyond what the trends we're seeing right now and these events could be, for instance, a cross to another adjustments, uh, in the US, uh, given that, that we have a, a, a rebate provision of more than 100 billion DKK. If you look in,
In our reporting that this this quarter. So, so just the the forecast on certain show on that number positive or negative. Uh, you know, could, uh, could could move, uh, the numbers up or down in, in in the range.
And and then as as as we've seen uh, the Obesity Market is, is somewhat volatile. So, uh, so we can have a scenario where where Trends are are are stronger, uh or and we have can have a scenario where Trends are are softer. And that's basically what the the way we constructed our our guidance range.
Thank you Ken for for answering question 1 in terms of guidance for the second 1 on formulation that goes to you Martin. Yeah, thank you very much for the question.
This does not require a new new, uh, bill for finish.
Thank you, Martin. Thank you, Carson and also thank you to you, uh, Emmanuel.
And with that final question, that concludes our Q&A session uh, would like to thank you for participating in order to contact investor relation in case of any follow-up questions before formally closing. The the call, I would like it, uh, to hand over to you last for your, your final final remarks. Yeah, thank you. Why? Let me just reiterate that we don't take our guidance reduction uh light we treat that without most uh seriousness.
We are uh has strong conviction in our ability to drive commercial execution, and get to many more patients that are currently uh, treated uh, than what is treated with our products today. Uh, and but we will acknowledge that we need to show that in in real hard data and we look forward to to doing that. Uh, over the coming period of time. We also excited about the pipeline read out to have for the rest of the year and also looking into to next year. And finally I would like to again. Congratulate Mike with this appointment, I'm confident that will Mike and the team will have said uh we have uh the execution power needed to to deliver on our expectations.
And the final remark. Thank you all in the investment Community for the many injections. We've had over the years. I've truly appreciated your challenging questions and support over the years, and I wish all the best of luck as I leave the company. As of today with that, we will close the call. And again, thank you all for your attention. Bye, bye.