Novo Nordisk announces 'slimming' plan with 9,000 job cuts

Danish pharmaceutical company Novo Nordisk announced a transformation plan this Wednesday aimed at "simplifying its organization, improving response speed, and reallocating resources to growth opportunities in the areas of diabetes and obesity." This will result in the Wegovy manufacturer cutting 9,000 jobs out of a total of 78,400, with 5,000 expected in Denmark. Savings are expected to reach €1 billion by the end of 2026. Shares rose 2.7% following the announcement.

"The transformation reflects the company's commitment to meeting growing global demand while competing in a more dynamic and consumer-driven obesity market, as evidenced by the recent slowdown in growth. In recent years, Novo Nordisk's rapid expansion has increased organizational complexity and costs. The transformation aims to address this complexity so that Novo Nordisk can invest more in its science, commercial capabilities, and production expansion—with the goal of reaching the millions of people who remain untreated," the pharmaceutical company said regarding its transformation plan.

Novo Nordisk President and CEO Mike Doustdar said that “as a global leader in obesity and diabetes, Novo Nordisk offers transformative products to patients around the world. But our markets are evolving, especially obesity, as it has become more competitive and consumer-driven. Our company needs to evolve too. This means instilling an increasingly performance-based culture, deploying our resources increasingly effectively, and prioritizing investment where it will have the greatest impact—in our core therapeutic areas.”

The workforce reduction at Novo Nordisk is expected to save around €1 billion by the end of 2026 (eight trillion Norwegian kroner).

The company says these savings will be “redirected to growth opportunities in diabetes and obesity,” which includes “commercial execution initiatives and research and development (R&D) programs.”

Implementation should "start immediately," the Danish company confirmed, with communication to affected employees taking place over the next few months "pending negotiations in accordance with the legal requirements" of the local labor market.

“In addition, additional initiatives will be implemented to improve organizational focus, performance culture and speed of decision-making, as well as cost efficiency,” the company said.

"It's always difficult to see talented and valued colleagues leave, but we're convinced this is the right decision for Novo Nordisk's long-term success. We need a shift in our mindset and approach to become faster and more agile. Our transformation plan is designed to achieve this. By realigning our resources now, we'll be able to prioritize investments to drive sustainable growth and future innovation for millions of patients with chronic diseases worldwide, especially diabetes and obesity," said Mike Doustdar, President and CEO of Novo Nordisk.

Plan should save one billion euros

This transformation is expected to have a one-time impact of €1 billion (8 billion Danish kroner). Restructuring costs, expected to reach €1.2 billion (9 billion Danish kroner), will impact third-quarter financials, which will be offset by savings of €134 million in the fourth quarter, according to the Danish pharmaceutical company.

"We expect an estimated one-time negative impact of approximately six percentage points on annual operating profit growth in 2025, compared to the operating profit outlook released on August 6. This change in expectations for 2025 only considers the one-off restructuring costs described above," Novo Nordisk confirmed.

This means that operating profit growth for 2025 will be between 4% and 10% compared to the range of 10% to 16% expected on August 6.

Shares are up 2.7% with this announcement. Since the beginning of the year, the pharmaceutical company has fallen 45.5% and in the space of a year, it has lost 60.2%.