Ozempic, Wegovy makers Novo Nordisk announce 9K layoffs in restructuring

Novo Nordisk, the maker of popular weight-loss drugs Ozempic and Wegovy, announced it is laying off about 9,000 workers in an effort to “streamline operations.”

The company made the announcement on Wednesday, saying it planned to cut 11 per cent of its global workforce with the expectation it will see C$1.7 billion in savings by the end of 2026. The company has 78,400 employees.

Employees affected will be contacted by the company over the next few months, according to the company.

Mike Doustdar, president and CEO of Novo Nordisk, said in a news release that the shift was needed because of how the markets for weight-loss drugs are “evolving.”

“Our markets are evolving, particularly in obesity, as it has become more competitive and consumer-driven,” Doustdar said. “Our company must evolve as well. This means instilling an increased performance-based culture, deploying our resources more effectively, and prioritising investment where it will have the most impact – behind our leading therapy areas.”

Novo Nordisk has faced growing competition, with U.S.-based Eli Lilly overtaking the Danish company in the obesity and diabetes markets.

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Eli Lilly’s Zepbound overtook Wegovy in weekly prescriptions in the U.S. earlier this year, though Wegovy’s prescriptions began to increase quickly over the summer, narrowing that lead.

But the company has also faced a wave of compounded copycat drugs.

Amid the competition, Novo Nordisk is now trying to boost output while meeting rising demand for its product and preparing for the release of the pill form of Wegovy.

“This is the new CEO’s first major move to simplify Novo’s structure and redirect resources toward growth in diabetes and obesity,” said Michael Novod, head of equity research for Denmark at Nordea Bank.

Doustdar told Danish media in a call this week that the company plans to reinvest the savings from layoffs into its drug pipeline and obesity launches in new markets, pointing to the rising costs of a commercial strategy that includes selling its drugs via consumer platforms such as telehealth to be more competitive.

In its news release, Novo Nordisk said the layoffs would be companywide, including impacts to its staff areas and headquarters.