Novo Nordisk Cuts 9,000 Jobs in Major Restructuring Amid Weight-Loss Drug Battle
Novo Nordisk, the pharmaceutical giant behind the blockbuster weight-loss drug Wegovy, announced on Wednesday that it will cut 9,000 jobs. The move aims to boost growth and face rising competition from U.S. rival Eli Lilly and an increasing number of copycat compounded drugs.
Largest Layoff in Denmark’s History
The restructuring marks the biggest layoff ever in Denmark and is expected to save Novo Nordisk around 8 billion Danish crowns ($1.25 billion) each year. The company is seeking to regain momentum under its new CEO after losing market leadership to Eli Lilly in the obesity and diabetes sectors.
Sales growth has slowed, while Novo Nordisk’s market value has dropped sharply. Since mid-2023, the firm has lost nearly $450 billion in market capitalization, hurting both investors and Denmark’s economy. On Wednesday, the company also issued its third profit warning of the year, pointing to 9 billion crowns in one-off costs related to the overhaul.
Struggles in the Weight-Loss Market
Analysts say Novo Nordisk needs to rebuild investor trust with a stronger growth outlook. According to shareholders, the company underestimated how consumer-driven the obesity drug market would become and expanded its organization too quickly.
Wegovy was the first highly effective obesity drug approved in the U.S. in 2021, pushing Novo Nordisk to the top of Europe’s stock market. But a rapid hiring spree nearly doubled the workforce, which has now backfired. The layoffs, about 11.5% of employees, bring staffing levels back to early 2024.
Despite these cuts, Denmark’s economy remains stable, according to Finance Minister Nicolai Wammen.
Shares, Leadership, and Investor Pressure
In July, investors wiped out $70 billion from Novo Nordisk’s valuation after profit warnings and the appointment of company veteran Mike Doustdar as CEO. Shares have dropped nearly 46% since the start of 2024, falling from a peak of $650 billion in market value last year to around $181 billion today.
Bank of America analysts expect another profit warning when Q3 results are published in November.
CEO’s First Big Move
The new CEO, Mike Doustdar, has prioritized a sharper focus on diabetes and obesity, stronger commercial execution, and redirecting resources to high-growth areas. Novo Nordisk is cutting jobs but also preparing to launch a pill version of Wegovy and explore additional health benefits from its GLP-1 drug portfolio.
The company still employs 78,400 people worldwide. However, demand for Wegovy and Ozempic is slowing, especially in the U.S., where Eli Lilly’s Zepbound has taken the lead in weekly prescriptions.
Reinvesting in Growth
Operating profit growth for 2025 is now forecast between 4% and 10%, far lower than the 19% to 27% predicted earlier this year. Novo Nordisk says it will reinvest cost savings into drug development, new obesity launches, and commercial strategies such as telehealth distribution to remain competitive.
The company has not disclosed which units will face the largest cuts, though 5,000 of the layoffs will take place in Denmark. Novo Nordisk reaffirmed its commitment to reinvesting savings into research, manufacturing expansion, and better global patient access.
