Novo Nordisk has revealed it is facing a lawsuit from disgruntled shareholders in its home market Denmark that seems to mirror a class action in the US.
In a statement, the drugmaker said that the latest lawsuit “alleges that Novo Nordisk made misleading statements and did not make appropriate disclosures regarding its sales of insulin products in the USA”.
It goes on to say those allegations are “broadly similar” to those made in a class-action lawsuit, filed in the US in 2017 by holders of the company’s American Depository Receipts (ADRs).
The disaffected shareholders are seeking a massive payoff in their lawsuit, going after DKK 11.78bn (around $1.75bn) in compensation based on trading and shares held between February 2015 and February 2017.
In a terse statement, Novo Nordisk said it “disagrees with the allegations and is prepared to defend the company in this matter”.
At the heart of the dispute are claims that the Danish drugmaker wasn’t completely transparent about the pricing pressure on insulin from healthcare payers in the US.
A lawyer for some of the plaintiffs told Reuters that while the company reported that its insulin sales increased between 2015 and 2017, rebates also rose sharply so profits from the sale of insulin decreased.
The US class action suit claims that Novo Nordisk and other insulin manufacturers entered into “an improper, collusive agreement to increase the prices of their insulin drugs, as evidenced by synchronised, skyrocketing prices for the insulin products over the past decade”, according to law firm Bernstein Litowitz Berger & Grossmann.
It also says the company told investors that its sales and profits would continue to grow significantly, even though its competitors revealed their insulin-related revenues would diminish as a result of pricing pressures from pharmacy benefit managers.
Novo Nordisk has latterly become less reliant on sales of its insulin products as newer products, particularly GLP-1 agonists Victoza (liraglutide) and Ozempic (semaglutide), have increased their share of revenues.