Sept. 3 (Bloomberg) -- Novo Nordisk A/S fell the most in more than five months in Copenhagen trading after the loss of a U.S. contract raised concern the Nordic region’s biggest drugmaker may face difficulties meeting its profit targets.
Novo lost as much as 3.8 percent, the biggest drop since March 18. The share, today’s biggest decliner on the Nasdaq OMX Copenhagen 20 Index, retreated 3.1 percent to 933 kroner at 11:32 a.m. local time. Trading volume was 78 percent of the daily average of the past three months.
Novo lost a contract to Eli Lilly & Co. to provide diabetes treatments including insulin and Victoza to Express Scripts Holding Co., the largest U.S. processor of prescription drug claims, said Peter Sehested and Michael Joergensen, analysts at Handelsbanken Capital Markets and Alm. Brand Markets, respectively. Though Novo may be able to make up the loss as it negotiates with other U.S. managed care providers for future deals, losing the Scripts contract shows how competitive the market has become, Sehested said.
“It’s worrying that they can push Victoza out even though it’s a premium and supreme product, as far as efficacy,” Sehested said by phone. He has a buy recommendation on Novo shares, according to data compiled by Bloomberg.
Novo has lost the Scripts contract, Mette Kruse Danielsen, a spokeswoman for the Bagsvaerd, Denmark-based company said by phone. She said she wasn’t immediately able to provide details on the content of the contract.
Losing the contract may depress revenue by as much as 2 percent, Joergensen said in a note to investors.
“This will make it more challenging for Novo to maintain their forecast for 15 percent in earnings before interest and tax in 2014,” he said. “We’re content with our hold recommendation.”
To contact the reporter on this story: Frances Schwartzkopff in Copenhagen at firstname.lastname@example.org