Novo Nordisk, the European Union’s biggest company by market capitalisation, has good news on that front—sort of. As their long-time spokesperson for climate action Lars Fruergaard Jørgensen resigns after eight years at the helm. The company is in the midst of a profound leadership transition. That’s against a backdrop as it faces competitive pressures in the booming weight loss drug market, and lowered its sales and operating profit expectations for next year.
The Danish pharmaceutical giant has forecast sales growth of 13 percent to 21 percent this year. This change to their previous advice, which had originally forecast growth between 16 percent and 24 percent. Novo Nordisk raised expectations for its operating profit to increase by 16 percent to 24 percent. This is down from the previous estimated range of 19 percent to 27 percent.
Jørgensen’s time at Novo Nordisk started in 1991, and he became CEO in 2017. During his tenure following the merger, the business struggled in multiple areas of the market. In March, these issues came to a head with a staggering 27 percent decline in share price, the worst monthly decline experienced in over two decades. Novo Nordisk had their fair share of misses, but in April they reported exciting early results. Their once-daily weight loss pill is giving them hopes for a comeback.
In light of recent developments, the Novo Nordisk Board and Jørgensen have jointly agreed that initiating a CEO succession is essential for the company’s future.
“Considering the recent market challenges, the share price decline, and the wish from the Novo Nordisk Foundation, the Novo Nordisk Board and Lars Fruergaard Jørgensen have jointly concluded that initiating a CEO succession is in the best interest of the company and its shareholders,” – Novo Nordisk
Jørgensen has been personally leading the search for his successor. At the same time, the company says it is committed to making a smooth transition to new leadership. Novo Nordisk is standing at a true crossroads as it adjusts its sights. Her decision to resign is intended to allow the company an opportunity to restore investor confidence.
Leave a Reply