company
`announcement
`
`e
`
`novo nordisk”
`
`Financial report for the period 1 January 2018 to 31 March 2018
`
`2 May 2018
`
`Novo Nordisk's operating profit decreased by 8% in Danish kroner and
`increased by 6% in local currencies in the first three months of 2018
`Sales decreased by 5% in Danish kroner and increased by 5% in local currencies
`
`Sales decreased by 5%in Danish kroner and increased by 5% in local currencies to DKK 26.9 billion.
`Sales of Victoza® increased by 4% to DKK 6.0 billion (18% in local currencies).
`Sales of Tresiba® increased by 18% to DKK 1.8 billion (33% in local currencies).
`Sales of Saxenda® increased by 43% to DKK 0.8 billion (64% in local currencies).
`Sales in North America Operations decreased by 11% (increased by 3% in local currencies).
`Sales in International Operations were unchanged (increased by 8% in local currencies).
`
`Sales within diabetes care and obesity decreased by 5% to DKK 22.6 billion (increased by 6% in local currencies).
`Sales within biopharmaceuticals decreased by 8% to DKK 4.3 billion (increased by 1% in local currencies).
`
`Operating profit decreased by 8% reported in Danish kroner and increased by 6% in local currencies to DKK 12.4
`billion, reflecting the significant depreciation of the US dollar and related currencies versus the Danish krone.
`
`Net profit increased by 6% to DKK 10.8 billion. Diluted earnings per share increased by 8% to DKK 4.40.
`
`In February, Novo Nordisk announced that the European Commission had granted marketing authorisation for
`Ozempic® (subcutaneous semaglutide) for the treatmentof adults with type 2 diabetes. In March, Novo Nordisk
`announced that the Japanese Ministry of Health, Labour and Welfare had approved Ozempic®. Furthermore, in
`February, Novo Nordisk launched Ozempic® in the USA following the approval in December 2017.
`
`In February, Novo Nordisk successfully completed the first phase 3a trial, POONEER 1, with oral semaglutide
`for treatment of adults with type 2 diabetes. The trial achieved its primary objective by demonstrating statistically
`significant and superior improvements in blood glucose levels (HbA,,) for all three doses of oral semaglutide
`compared to placebo.
`
`In March, Novo Nordisk announced that the US Food and Drug Administration had approved an update to the US
`prescribing information for Tresiba® (insulin degludec) based on the DEVOTEtrial to include data on cardiovascular
`outcomes and severe hypoglycaemia in the label.
`
`For 2018, sales growth is now expected to be 3-5% measured in local currencies compared with the prior guidance
`of 2-5% and operating profit growth is now expected to be 2-5% compared with the prior guidance of 1-5%.
`Sales growth and operating profit growth reported in Danish kroner are now expected to be 6 and 9 percentage
`points lower than in local currencies, respectively.
`
`Lars Fruergaard Jorgensen,president and CEO: “Based on the performance ofour key products Victoza®, Tresiba®
`and Saxenda®, we delivered solid underlying growth in both sales and operating profitin the first three months of
`2018. We reached important milestones with our once-weekly GLP-1 Ozempic®, as we launched in the USA and
`received approvals in both the EU and Japan. Moreover, we are encouragedbythefirst clinical results for oral
`semaglutide from the PIONEER 1 trial.”
`
`Novo Nordisk A/S
`Investor Relations
`
`Novo Allé
`2880 Bagsveerd
`Denmark
`
`Telephone:
`+45 4444 8888
`www.novonordisk.com
`
`CVR Number:
`24 25 67 90
`
`Company announcement No 37 / 2018
`
`MPI EXHIBIT 1118 PAGE 1
`
`

`

`Financial report for the period 1 January 2018 to 31 March 2018
`
`Page 2 of 29
`
`About Novo Nordisk
`
`Novo Nordisk is a global healthcare company with 95 years of innovation and leadership in diabetes care. This
`heritage has given us experience and capabilities that also enable us to help people defeat obesity, haemophilia,
`growth disorders and otherserious chronic diseases. Headquartered in Denmark, Novo Nordisk employs
`approximately 42,700 people in 79 countries, and markets its products in more than 170 countries. Novo Nordisk’s
`B sharesare listed on Nasdaq Copenhagen (Novo-B). Its ADRsare listed on the New York Stock Exchange (NVO).
`For more information, visit novonordisk.com, Facebook, Twitter, LinkedIn, YouTube.
`
`Conferencecall details
`
`On 2 May 2018 at 13.00 CEST, corresponding to 7.00 am EDT, a conferencecall will be held. Investors will be able
`to listen in via a link on novonordisk.com, which can be found under ‘Investors’. Presentation material for the
`conferencecall will be available approximately one hour before on the same page.
`
`Webcast details
`
`On 3 May 2018 at 14.15 CEST, corresponding to 8.15 am EDT, managementwill give a presentation to
`institutional investors andsell-side analysts in London. A webcast of the presentation can be followedviaalink on
`novonordisk.com, which can be found under ‘Investors’. Presentation material for the webcast will be made
`available on the same page.
`
`Financial calendar
`
`8 August 2018
`1 November 2018
`
`Financial statementfor first six months of 2018
`Financial statementfor first nine months of 2018
`
`1 February 2019
`
`Financial statement for 2018
`
`Contacts for further information
`
`Media:
`Katrine Sperling
`Ken Inchausti (USA)
`
`Investors:
`
`Peter Hugreffe Ankersen
`Anders Mikkelsen
`
`Christina Kjaer
`
`+45 3079 6718
`+1 267 809 7552
`
`krsp@novonordisk.com
`kiau@novonordisk.com
`
`+45 3075 9085
`+45 3079 4461
`
`+45 3079 3009
`
`phak@novonordisk.com
`armk@novonordisk.com
`
`cnje@novonordisk.com
`
`Further information about Novo Nordisk is available on novonordisk.com.
`
`Company announcementNo 37 / 2018
`
`MPI EXHIBIT 1118 PAGE 2
`
`

`

`Financial report for the period 1 January 2018 to 31 March 2018
`
`Page 3 of 29
`
`LIST OF CONTENTS
`
`FINANCIAL PERFORMANCE ............:000cccccceeceeceeeeceeeeeeeceeeeeeaaaaeeeeeeeeeeeeeeeeeceseeeesecieesaeeeeeeeeeeeeeeeseeeeees
`
`Consolidated financial statementfor the first three months Of 2017 .......eececceceeceseeeeeeeeeeeteeesees
`
`Sales developMent ...........cccccccceccceeeceeeeeeeeeecaeeeeeeeceeesaeeesaeesaeecseceaeeceeeeeeecaeeseeeeeeeetsesteseeteeseeeeneees
`
`Diabetes care and obesity, sales developMent...........cccccceccccesceeeceeeeeeseeeeeseeeesseesesseeectsseeesseeeenaaes
`
`Biopharmaceuticals, sales development ..........ccccccccccccseceesneeeeseeeeceseeeceseeesseeeseeeeeeseescneeersteesensees
`
`Developmentin costs and Operating Profit... cc ccc cece cseeccseesseeseessesesseeessesseecssessseessaeesaes
`
`Financial items (Met) occ cceecccccccccceceeaeeeeeeeceescccccccceeuaasavaveneceeeseeceseeeeuausuaanaeereeeeceseseseuuareasasaneness
`
`Capital expenditure and free cash flOW .........cccecccecccecceeeceeeeeeeeeeeseeeeeeecseeeseeecseesueeseseeeeeenseeeteeeaaes
`OUTLOOK 00... ccc cece cece cee ceecee eect eee e eee e ease aaaeeeeeeeeeeeeeeeceesecs ce eeeaaeacueeeeeeeeeeeeeeseeeeesecesseeceseeeeeeeeeeess
`
`RESEARCH & DEVELOPMENT UPDATE.........0...c:cccccccccceeececeeee cence eeeeecaeeeceeeeeeeeeeseesetescesststeseeeeeeeeeeeess
`
`SUSTAINABILITY UPDATE .0........cccecceceeeeeeceeeeeeeeeeeeeeececneeeeeeeeeneaeeeeceteseeeececctseeeeeciiiaeeeeeetsieeeeeenteeees
`
`EQUITY 0. e ee ceeeccceeccece cece ccceeeeeeeeeceeeeeeeeeceeeeeecceaaaeeesecceeeeeececnaeeeecececeeeeeeeciceeeeeetiteeeeeeseseteeeeeessneeeeess
`MANAGEMENTSTATEMENT..........c:ccccceceeeceeeeeeeeeeeeeeeceneeeeeeecceeeeeeeeeeeeeececaaeeeesceteaeeeeettiteeeeeentuanees
`
`FINANCIAL INFORMATION ........0cccccccceeeeeeceeeeeeeeeeeeeececeeeeeeesceaeeeeeeeneceeeeecensiseeeeecsiteeeeeeennieeeeeeneneees
`
`Appendix 1: Quarterly numbers in DKK........0.ceceeceeccececceeeeceeeceeceeeccaeeeceeeceeesseeeeeesseeneeeneeeseees
`
`Appendix 2: Income statement and statement of other comprehensive income............::00:00
`
`Appendix 3: Cash flow statement............ccccccccccecceeceeceeeeeeceeaeeceeeeeeecseeeeeeecseecseecseeeneeetieeetseeneeees
`
`Appendix 4: Balance Sh@et............ccccccccccceeceeceeceneeceeeeceeeeceeeceeesaeecaecesaeecseeeeeecseesneeecseeensestaeeenseeses
`
`Appendix 5: Equity Statement... cccccccccccceccccceeecseeeseeeeeneeeccaeeecseeeeessescseeescnseeesseeeeseeeestaaees
`
`Appendix 6: Regional sales Split... ccccccccceccccceeecceececeeeeeeeeeeneeeesteeeeseeeesseeeesiseeenteeeesseesenies
`
`Appendix 7: Key CUrreNcy ASSUMPTIONS. ..........c:cccecceccececesseeeesseeeeeeeeecstseeecseeeeeaeeeeseeectseeeenseeeeneaes
`
`Appendix 8: Quarterly numbers in USD (additional information)...........0.:ccccccccceeeeeteeeeeeteteeteeee
`
`Appendix 9: Non-lFRS financial measures (additional information)............:::cceccceseeeeeeeeeeteeteee
`
`Appendix 10: New accounting standards in 2018........0.cccccscccceeceeeeeceeeeeeeeeeeeceeeneessneeeneessseeees
`
`4
`
`4
`
`5
`
`6
`
`9
`
`9
`
`10
`
`10
`11
`
`13
`
`16
`
`16
`19
`
`20
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`29
`
`ogance
`
`Outlook
`
`R&D
`
`Sustainability
`
`Equity
`
`tan
`
`Company announcementNo 37 / 2018
`
`MPI EXHIBIT 1118 PAGE 3
`
`

`

`Financial report for the period 1 January 2018 to 31 March 2018
`
`Page 4 of 29
`
`FINANCIAL PERFORMANCE
`
`CONSOLIDATED FINANCIAL STATEMENT FOR THE FIRST THREE MONTHS OF 2018
`
`These unaudited consolidated financial statements for the first three months of 2018 have been preparedin
`accordance with IAS 34 ‘Interim Financial Reporting’. The accounting policies adopted in the preparation are
`consistent with those applied in the Annual Report 2017 of Novo Nordisk, except for the adoption of new,
`amended or revised standards and interpretations (‘IFRSs’) as published by the IASB that are endorsed by the EU and
`effective as of 1 January 2018. This includes IFRS 9 ‘Financial Instruments’ applied prospectively and IFRS 15
`‘Revenue from Contracts with Customers’ applied on a modified retrospective basis, see appendix 10. Furthermore,
`the financial report including the consolidated financial statements for the first three months of 2018 and
`Management's review have been prepared in accordance with additional Danish disclosure requirements for interim
`reports oflisted companies.
`
`Amounts are in DKK million, except number of shares, earnings per share and full-time equivalent employees.
`
`
`PROFIT AND LOSS
`DKK million
`
`Net sales
`
`Grossprofit
`Gross margin
`
`Sales and distribution costs
`
`Percentageofsales
`
`Research and developmentcosts
`Percentage of sales
`
`Administrative costs
`
`Percentageofsales
`
`Other operating income, net
`
`Operatingprofit
`Operating margin
`
`Financial items (net)
`
`Profit before income taxes
`
`Income taxes
`Effective tax rate
`
`Netprofit
`Net profit margin
`
`OTHER KEY NUMBERS
`
`Depreciation, amortisation and impairment losses
`Capital expenditure (tangible assets)
`
`Net cash generated from operating activities
`Free cash flow
`
`Total assets
`Equity
`Equity ratio
`
`Average numberof diluted shares outstanding (million)
`Diluted earnings per share / ADR (in DKK)
`
`Full-time equivalent employees end of period
`
`Q1 2018
`
`Q1 2017
`
`% change
`Q1 2017
`to Q1 2018
`
`26,930
`
`22,733
`84.4%
`
`6,451
`24.0%
`
`3,321
`12.3%
`
`864
`3.2%
`
`351
`
`12,448
`46.2%
`
`1,161
`
`13,609
`
`2,858
`21.0%
`
`10,751
`39.9%
`
`732
`2,310
`
`9,815
`7,241
`
`93,558
`44,238
`47.3%
`
`2,442.3
`4.40
`
`42,688
`
`28,452
`
`24,201
`85.1%
`
`6,787
`23.9%
`
`3,289
`11.6%
`
`913
`3.2%
`
`278
`
`13,490
`47.4%
`
`(486)
`
`13,004
`
`2,848
`21.9%
`
`10,156
`35.7%
`
`708
`1,604
`
`12,098
`10,400
`
`94,213
`40,301
`42.8%
`
`2,500.0
`4.06
`
`41,636
`
`(5%)
`
`(6%)
`
`(5%)
`
`1%
`
`(5%)
`
`26%
`
`(8%)
`
`N/A
`
`5%
`
`0%
`
`6%
`
`3%
`44%
`
`(19%)
`(30%)
`
`(1%)
`10%
`
`(2%)
`8%
`
`3%
`
`Financial
`Performance
`
`Outlook
`
`R&D
`
`Sustainability
`
`Equity
`
`Financial
`Information
`
`Company announcement No 37 / 2018
`
`MPI EXHIBIT 1118 PAGE 4
`
`

`

`Financial report for the period 1 January 2018 to 31 March 2018
`
`Page 5 of 29
`
`SALES DEVELOPMENT
`
`Sales decreased by 5% measured in Danish kroner and increased by 5% in local currencies, reflecting a significant
`impact from the depreciation of the US dollar and related currencies versus the Danish krone. Sales growth was
`realised within diabetes care and obesity with the majority of growth originating from Victoza®, Tresiba® and
`Saxenda®,partly offset by declining sales of Levemir®. Sales growth within biopharmaceuticals wasdriven by
`increased sales of NovoEight® and NovoSeven®,partly offset by Other biopharmaceuticals.
`
`
`Sales split per therapy
`The diabetes care and obesity segment
`
`Sales Q1 2018
`DKKmillion
`
`Sales Q1 2017
`DKKmillion
`
`Growth
`as reported
`
`Growth
`in local
`currencies
`
`Share of
`growth
`in local
`currencies
`
`Long-acting insulin
`- Tresiba®
`- Xultophy®
`- Levemir®
`
`Premix insulin
`- Ryzodeg®
`- NovoMix®
`
`Fast-acting insulin
`- Fiasp®
`- NovoRapid®
`Human insulin
`
`Total insulin
`
`Total GLP-1
`- Victoza®
`- Ozempic®
`Otherdiabetes care”
`Total diabetes care
`
`Obesity (Saxenda®)
`
`Diabetes care and obesity total
`
`The biopharmaceuticals segment
`Haemophilia”
`- NovoSeven®
`- NovoEight®
`Growth disorders
`Other biopharmaceuticals”
`Biopharmaceuticals total
`
`4,873
`1,755
`338
`2,780
`
`2,642
`141
`2,501
`
`4,778
`83
`4,695
`2,366
`
`14,659
`
`6,058
`5,989
`69
`1,121
`21,838
`
`770
`
`22,608
`
`2,503
`2,154
`296
`1,481
`338
`4,322
`
`5,606
`1,491
`103
`4,012
`
`2,861
`95
`2,766
`
`5,317
`3
`5,314
`2,516
`
`16,300
`
`5,750
`5,750
`-
`1,172
`23,222
`
`539
`
`23,761
`
`2,576
`2,311
`229
`1,646
`469
`4,691
`
`Total sales
`
`26,930
`
`28,452
`
`” Primarily NovoNorm® and needles.
`?) Comprises NovoSeven®, NovoEight®, NovoThirteen® and Refixia®.
`3) Primarily Vagifem® and Activelle®.
`
`(13%)
`18%
`228%
`(31%)
`
`(8%)
`48%
`(10%)
`
`(10%)
`-
`(12%)
`(6%)
`
`(10%)
`
`5%
`4%
`-
`(4%)
`(6%)
`
`43%
`
`(5%)
`
`(3%)
`(7%)
`29%
`(10%)
`(28%)
`(8%)
`
`(5%)
`
`(3%)
`33%
`246%
`(22%)
`
`1%
`65%
`(1%)
`
`0%
`-
`(2%)
`3%
`
`0%
`
`19%
`18%
`-
`5%
`5%
`
`64%
`
`6%
`
`7%
`3%
`38%
`0%
`(23%)
`1%
`
`5%
`
`(10%)
`33%
`17%
`(60%)
`
`2%
`4%
`(2%)
`
`0%
`6%
`(6%)
`4%
`
`(4%)
`
`73%
`68%
`5%
`4%
`73%
`
`23%
`
`96%
`
`12%
`4%
`6%
`0%
`(8%)
`4%
`
`100%
`
`Both International Operations and North America Operations contributed to sales growth with 70% and 30%
`respectively. Within International Operations, the main growth contributors were Region Latin America, Region
`AAMEO (Africa, Asia, Middle East and Oceania) and Region China, partly offset by Region Japan & Korea. Sales
`growth in Region Latin America of 73% measured in local currencies was positively impacted by 9% percentage
`points dueto inflationary price effects in countries with high inflation.
`
`Financial
`Performance
`
`Outlook
`
`R&D
`
`Wah:
`Sustainability
`
`Equity
`
`Financial
`Information
`
`Company announcement No 37 / 2018
`
`MPI EXHIBIT 1118 PAGE 5
`
`

`

`Financial report for the period 1 January 2018 to 31 March 2018
`
`Page 6 of 29
`
`
`
`Sales split per region
`
`North America Operations
`- USA
`International Operations
`- Region Europe
`- Region AAMEO
`- Region China
`- Region Japan & Korea
`- Region Latin America
`
`Total sales
`
`Sales Q1 2018
`DKK million
`
`Growth
`as reported
`
`Growth
`in local currencies
`
`Share of growth
`in local currencies
`
`13,366
`12,878
`13,564
`5,233
`2,899
`3,029
`1,257
`1,146
`
`26,930
`
`(11%)
`(11%)
`0%
`0%
`(2%)
`(1%)
`(14%)
`44%
`
`(5%)
`
`3%
`3%
`8%
`1%
`12%
`6%
`(6%)
`73%
`
`5%
`
`30%
`30%
`70%
`2%
`23%
`12%
`(6%)
`39%
`
`100%
`
`Please refer to appendix 6 for further details on sales in the first three months of 2018.
`
`In the following sections, unless otherwise noted, market data are based on moving annual total (MAT) from
`February 2018 and February 2017 provided by the independent data provider IQVIA.
`
`DIABETES CARE AND OBESITY, SALES DEVELOPMENT
`
`Sales of diabetes care and obesity products decreased by 5% measured in Danish kroner and increased by 6% in
`local currencies to DKK 22,608 million. Novo Nordiskis the world leader in diabetes care with a global value market
`share of 27%.
`
`Insulin
`
`Sales of insulin decreased by 10% to DKK 14,659 million measured in Danish kroner and remained unchanged in
`local currencies. Measuredin local currencies, sales were driven by International Operations, whereall five regions
`apart from Region Japan & Korea contributed to growth, offset by lowersales in North America Operations. Novo
`Nordisk is the global leader with 46% of the total insulin market and 45% of the market for modern insulin and
`new-generation insulin, both measured in volume.
`
`Sales of long-acting insulin (Tresiba®, Xultophy® and Levemir®) decreased by 13% measured in Danish kroner and
`3% in local currencies to DKK 4,873 million.
`
`Sales of Tresiba® (insulin degludec), the once-daily new-generation insulin, reached DKK 1,755 million compared
`with DKK 1,491 million in 2017. Theroll-out of Tresiba® continues and the product has now been launched in 65
`countries. Generally, Tresiba® has shownsolid penetration in markets with reimbursementat a similar level to insulin
`glargine U100, whereas penetration remains modest in markets with restricted market access.
`
`Sales of Xultophy®, a once-daily combination ofinsulin degludec (Tresiba®) andliraglutide (Victoza®), reached DKK
`338 million compared with DKK 103 million in 2017. Sales growth was driven by both International Operations,
`where predominantly Region Europe contributed to growth, and North America Operations. Xultophy® has now
`been launched in 22 countries.
`
`Sales of premix insulin (Ryzodeg® and NovoMix®) decreased by 8% measured in Danish kronerandincreased by 1%
`in local currencies to DKK 2,642 million.
`
`Sales of Ryzodeg®,a soluble formulation of insulin degludec and insulin aspart, reached DKK 141 million compared
`with DKK 95 million in 2017. Ryzodeg® has now been marketed in 20 countries, and feedback from patients and
`prescribers is encouraging.
`
`Sales of fast-acting insulin (Fiaso® and NovoRapid®) decreased by 10% to DKK 4,778 million measured in Danish
`kroner and remained unchanged in local currencies.
`
`Sales of Fiasp®, the novel mealtime fast-acting insulin aspart, were DKK 83 million. Fiasp® has been launched in 17
`countries.
`
`Financial
`Performance
`
`Outlook
`
`R&D
`
`Wah:
`Sustainability
`
`Equity
`
`Financial
`Information
`
`Company announcement No 37 / 2018
`
`MPI EXHIBIT 1118 PAGE 6
`
`

`

`Financial report for the period 1 January 2018 to 31 March 2018
`
`Page 7 of 29
`
`
`
`INSULIN MARKET SHARES
`(volume, MAT)
`
`Novo Nordisk’s share
`of the total insulin market
`
`Novo Nordisk’s share
`of the moderninsulin and
`new-generationinsulin market*
`
`Global
`North America Operations
`- USA
`International Operations
`- Region Europe
`- Region AAMEO**
`- Region China***
`- Region Japan & Korea
`- Region Latin America****
`
`February
`2018
`
`46.4%
`39.3%
`39.5%
`49.5%
`44.0%
`55.6%
`57.8%
`49.8%
`42.7%
`
`February
`2017
`
`46.3%
`37.3%
`37.1%
`50.3%
`45.0%
`56.9%
`58.8%
`49.2%
`41.5%
`
`February
`2018
`
`45.0%
`40.1%
`40.6%
`47.6%
`43.7%
`50.7%
`60.9%
`49.6%
`39.0%
`
`February
`2017
`
`44.5%
`38.0%
`38.2%
`48.1%
`44.6%
`51.6%
`60.8%
`48.4%
`40.0%
`
`Source: IQVIA, February 2018 data. * Moderninsulin and new-generation insulin comprises the following Novo Nordisk products: Levemir®, NovoMix®, NovoRapid®,
`Tresiba®, Xultophy®, Ryzodeg® and Fiasp® ** Data for 11 selected private markets representing approximately 70% of total Novo Nordisk’s diabetes care sales in the
`region. *** Data for mainland China, excluding Hong Kong and Taiwan. **** Data for three selected private markets representing approximately 70% of total Novo
`Nordisk’s diabetes care sales in the region.
`
`North America Operations
`Sales of insulin in North America Operations decreased by 19% in Danish kroner and by 7% in local currencies. The
`decline in sales in the USA was mainly driven by lower Levemir® sales due to lowerrealised prices as well as lower
`sales of NovoRapid® due to phasing of rebates in 2017. The sales development waspartly offset by higher sales of
`Tresiba® due to market share gain, underlying volume growthof both the long-acting and short-acting insulin
`segments as well as increasedsales of Xultophy® 100/3.6.
`
`International Operations
`Sales of insulin in International Operations decreased by 1% in Danish kroner and increased by 6% in local
`currencies. Sales growth measured in local currencies was driven by long-acting, premix and fast-acting insulin,
`partly offset by declining human insulin sales.
`
`Region Europe
`Sales of insulin in Region Europe increased by 1% in both Danish kroner and in local currencies. Sales were driven by
`the penetration of Xultophy®, Fiasp® and Tresiba® acrossthe region,partly offset by contracting Levemir® sales
`reflecting the continuedroll-out of Tresiba® as well as declining NovoMix® and human insulin sales.
`
`Region AAMEO
`Sales of insulin in Region AAMEO remained unchangedin Danish kroner and increased by 14% in local currencies.
`The sales growth measuredin local currencies was driven by growth of the overall diabetes care market and positive
`contribution from all three insulin segments: long-acting, premix and fast-acting as well as human insulin.
`
`Region China
`Sales of insulin in Region China decreased by 3% in Danish kroner and increased by 3% in local currencies. The sales
`growth measuredin local currencies was driven by continued growth in the three insulin segments: long-acting,
`premix and fast-acting, and Novo Nordisk has improved its market share in the long-acting and fast-acting insulin
`segments and therebystabilised the modern insulin market share, partly offset by lower human insulin sales.
`
`Region Japan & Korea
`Sales of insulin in Region Japan & Korea decreased by 10% in Danish kroner and by 2% in local currencies. The
`decline in sales was driven by NovoMix® and NovoRapid® as well as lower human insulin sales, partly offset by
`positive contribution from the continued uptake of Ryzodeg® andTresiba® in Japan.
`
`Region Latin America
`Sales ofinsulin in Region Latin America increased by 4% in Danish kroner and by 30% in local currencies. The
`increased sales is driven by growth of the overall diabetes care market and positive contribution from all three insulin
`segments: long-acting, premix and fast-acting as well as human insulin.
`
`Financial
`Performance
`
`Outlook
`
`R&D
`
`Wah:
`Sustainability
`
`Equity
`
`Financial
`Information
`
`Company announcement No 37 / 2018
`
`MPI EXHIBIT 1118 PAGE 7
`
`

`

`Financial report for the period 1 January 2018 to 31 March 2018
`
`Page 8 of 29
`
`GLP-1 therapy for type 2 diabetes
`Sales of GLP-1 therapy for type 2 diabetes (Victoza® and Ozempic®) increased by 5% in Danish kroner and by 19%
`in local currencies to DKK 6,058 million. Sales growth is predominantly driven by North America Operations
`comprising 84% share of the GLP-1 growth. The GLP-1 segment’s value share of the total diabetes care market has
`increased to 12.3% compared with 10.2% 12 months ago. Victoza® continues to be the market leader in the GLP-1
`segment with a 48% value market share.
`
`
`GLP-1 MARKET SHARES
`(value, MAT)
`
`GLP-1 share oftotal
`diabetes care market
`
`Victoza® share
`of GLP-1 market
`
`Global
`North America Operations
`- USA
`International Operations
`- Region Europe
`- Region AAMEO*
`- Region China**
`- Region Japan & Korea
`- Region Latin America***
`
`February
`2018
`
`12.3%
`14.5%
`14.7%
`6.8%
`10.8%
`2.8%
`1.0%
`4.9%
`5.4%
`
`February
`2017
`
`10.2%
`12.0%
`12.1%
`6.0%
`9.8%
`2.4%
`0.9%
`3.6%
`4.8%
`
`February
`2018
`
`February
`2017
`
`48%
`47%
`47%
`55%
`57%
`47%
`13%
`38%
`73%
`
`56%
`54%
`53%
`63%
`64%
`53%
`58%
`55%
`87%
`
`Source: IQVIA, February 2018 data MAT. * Data for 11 selected private markets representing approximately 70% of Novo Nordisk’s total diabetes care sales in the
`region. ** Data for mainland China, excluding Hong Kong and Taiwan. *** Data for three selected private markets representing approximately 70% of Novo Nordisk’s
`total diabetes care sales in the region.
`
`North America Operations
`Sales of Victoza® in North America Operations increased by 3% in Danish kroner and by 19% in local currencies.
`Sales growth is driven by an underlying prescription volume growth of the GLP-1 class of more than 20% in the USA
`and thepositive impact from the expanded CVlabel for Victoza®. In February 2018, Novo Nordisk launched
`Ozempic® in the USA, a new once-weekly GLP-1, and theinitial feedback from prescribers and payersis positive and
`the formulary coverage for Ozempic® is progressing well. Ozempic® sales were predominantly driven by inventory
`build-up related to the launch. The growth of the GLP-1 market continues to be driven by competing once-weekly
`products and Victoza®. The value share of the GLP-1 class of the total North American diabetes care market has
`increased to 14.7%. Despite intensified competition, Novo Nordiskis still the market leader with a 47%value
`market share.
`
`International Operations
`Sales of Victoza® in International Operations increased by 6% in Danish kroner and by 12% in local currencies. Sales
`growth is driven by all regions. The value share of the GLP-1 class of the total International Operations diabetes care
`market has increased to 6.8% from 6.0% in 2017. Victoza® is the market leader with a 55% value market share.
`
`Region Europe
`Sales in Region Europe increased by 7% in both Danish kroner and in local currencies. The sales development
`reflects positive impact from the expanded CVlabel for Victoza® as well as competition from a recently introduced
`once-weekly product. In Region Europe, the value share of the GLP-1 class of the total diabetes care market has
`increased to 10.8%. Victoza® remains the market leader in Region Europe with a 57% value market share.
`
`Region AAMEO
`Sales in Region AAMEO increased by 1% in Danish kroner and by 16% in local currencies. Sales growth is primarily
`driven by a numberof countries in the Middle East. The value share of the GLP-1 class of the total diabetes care
`market increased to 2.8%. Victoza® is the GLP-1 market leader across Region AAMEO with a value market share of
`AT%.
`
`Region China
`Sales in Region China increased by 43% in Danish kroner and by 53% in local currencies. The increase in sales
`reflects the inclusion of Victoza® in the Chinese National Reimbursement Drug List in July 2017. In China, the volume
`
`Financial
`Performance
`
`Outlook
`
`R&D
`
`Sustainability
`
`Equity
`
`Financial
`Information
`
`Company announcement No 37 / 2018
`
`MPI EXHIBIT 1118 PAGE 8
`
`

`

`Financial report for the period 1 January 2018 to 31 March 2018
`
`Page 9 of 29
`
`growthis encouraging, and Victoza® hasincreased its GLP-1 value market share to 73%. However, the GLP-1 class
`only represents 1.0% of the total diabetes care market measuredin value.
`
`Region Japan & Korea
`Sales in Region Japan & Korea decreased by 6% in Danish kroner and increased by 3% in local currencies. The sales
`growth measuredin local currencies reflects the continued expansion of the GLP-1 market in Japan, partly offset by
`intensified competition from a once-weekly product. In Region Japan & Korea, the GLP-1 class represents 4.9% of
`the total diabetes care market value compared with 3.6% in 2017. Victoza® holds a value market share of 38%.
`
`Region Latin America
`Sales in Region Latin America increased by 3%in Danish kroner and by 24% in local currencies. The sales growth
`reflects the continued expansion of the GLP-1 markets across the region. In Region Latin America, the GLP-1 class
`represents 5.4% of the total diabetes care market value compared with 4.8% in 2017. Victoza® remains the leader
`in the class with a value market share of 73%.
`
`Other diabetes care
`
`Sales of other diabetes care products, predominantly consisting of oral antidiabetic products and needles, declined
`by 4% to DKK 1,121 million and increased by 5% in local currencies. Increasing sales measured in local currencies
`were seen in both North America Operations and International Operations, whereall regions apart from Region
`Europe and Region AAMEO experienced increasedsales.
`
`Saxenda® (obesity)
`Sales of Saxenda®,liraglutide 3 mg for weight management, increased by 43% in Danish kroner and by 64%in
`local currencies to DKK 770 million. Sales growth was driven by both North America Operations and International
`Operations, where Region AAMEO,Region Latin America and Region Europe contributed to growth. Saxenda® was
`launched in May 2015 in the USA and has obtained broad commercial formulary market access, but generally with
`prior authorisation requirements. Saxenda® has now beenlaunched in 26 countries.
`
`BIOPHARMACEUTICALS, SALES DEVELOPMENT
`
`Sales of biopharmaceutical products decreased by 8% measured in Danish kroner and increased by 1% in local
`currencies to DKK 4,322 million. Increasing sales were realised in International Operations, partly offset by lower
`sales in North America Operations.
`
`Haemophilia
`Sales of haemophilia products decreased by 3% measured in Danish kroner and increased by 7% in local currencies
`to DKK 2,503 million. The sales increase measured in local currencies was primarily driven by increased NovoSeven®
`sales in Region Latin America due to timing of tender deliveries, partly offset by lower NovoSeven® sales in the USA
`and Region Europereflecting increased competition from a recently introduced product. Furthermore, sales of
`NovoEight® in the USA and in Region Europe contributed to the growth.
`
`Growth disorders
`
`Sales of growth disorder products decreased by 10% to DKK 1,481 million measured in Danish kroner and remained
`unchanged in local currencies. The sales development measuredin local currencies was driven by positive
`contribution from North America Operations, offset by declining sales in International Operations predominantly
`Region Japan & Korea, Region AAMEO and Region Europe. Novo Nordisk is the leading company in the global
`human growthdisorder market with a 27% market share measured in volume.
`
`Other biopharmaceuticals
`Sales of other products within biopharmaceuticals, which predominantly consist of hormone replacement therapy-
`related (HRT) products, declined by 28% measured in Danish kroner and by 23% in local currencies to DKK 338
`million, primarily reflecting an effect from the launch of a generic version of Vagifem® in the USA.
`
`DEVELOPMENTIN COSTS AND OPERATING PROFIT
`
`The cost of goods sold remained broadly unchanged at DKK 4,197 million, resulting in a gross margin of 84.4%
`measured in Danish kroner and 85.1% in local currencies, compared with 85.1% in 2017. The decline in gross
`margin reflects a negative currency impact of 0.7 percentage point.In addition, the gross margin was negatively
`impacted by lowerprices primarily reflecting intensified competition in the insulin segment in the USA. The negative
`
`Financial
`Performance
`
`Outlook
`
`R&D
`
`Wah:
`Sustainability
`
`Equity
`
`Financial
`Information
`
`Company announcement No 37 / 2018
`
`MPI EXHIBIT 1118 PAGE 9
`
`

`

`Financial report for the period 1 January 2018 to 31 March 2018
`
`Page 10 of 29
`
`developmentin gross margin waspartly offset by a positive contribution from product mix due to higher Victoza®,
`Tresiba® and Saxenda® sales, but partly countered by lower contribution from NovoSeven®.
`
`Sales and distribution costs declined by 5%in Danish kroner and increased by 5% in local currencies to DKK 6,451
`million. The increase in sales and distribution costs reflects higher promotional activities in both International
`Operations and North America Operations to support Victoza® and Saxenda® as well as the launchactivities for
`Ozempic®, especially in the USA,partly offset by lowercosts for legal cases.
`
`Research and developmentcosts increased by 1% in Danish kroner and by 5% in local currencies to DKK 3,321
`million, reflecting higher costs for both research and development. The increase in research costs was driven by
`increased costs for the diabetes care and obesity portfolio. The increase in development costs was predominantly
`driven by the phase 3b SUSTAIN programmefor Ozempic®.
`
`Administration costs declined by 5% in Danish kroner and remained broadly unchangedin local currencies to DKK
`864 million. The development in administrative costs measured in local currencies is mainly related to general cost
`control initiatives.
`
`Other operating income (net) was DKK 351 million compared with DKK 278 million in 2017. In the first three
`months of 2018, Novo Nordisk recorded a net gain of DKK 122 million following the disposal of 2 million shares in
`NNIT to Novo Holdings A/S. Novo Nordisk now controls 17.5% of the share capital of NNIT A/S, which remains an
`associated company of Novo Nordisk A/S.
`
`Operating profit decreased by 8% in Danish kroner and increased by 6% in local currencies to DKK 12,448 million.
`
`FINANCIAL ITEMS (NET)
`Financial items (net) showed a net gain of DKK 1,161 million compared with a net loss of DKK 486 million in 2017.
`
`In line with Novo Nordisk’s treasury policy, the most significant foreign exchangerisks for the Group have been
`hedged,primarily through foreign exchange forward contracts. The foreign exchangeresult was a gain of DKK
`1,107 million compared with a loss of DKK 468 million in 2017. This developmentreflects a gain on foreign
`exchange hedging involving especially the US dollar and Japanese yen versus the Danish krone.
`
`The financial items (net) for the first three months of 2018 is after a positive market value of financials contracts as
`per the end of March 2018 of approximately DKK 1.5 billion has been deferred for income recognition later in 2018.
`
`CAPITAL EXPENDITURE AND FREE CASH FLOW
`
`Net capital expenditure for property, plant and equipment was DKK2.3 billion compared with DKK 1.6 billion in
`2017. Net capital expenditure wasprimarily related to investment