Our 2009 accomplishments and results DKK billion The Board of Directors has approved a new DKK 7.5 billion share repurchase programme to be executed during 2010. 7.9 7.5 7.2 6.3 5.1 Research & development costs Diabetes care (excl pulmonary diabetes projects) Biopharmaceuticals 2009 2008 2007 2006 2005 0 2 4 Share savings programme In the autumn of 2009, the employees in the Danish part of the organisation were offered participation in a share savings programme. An annual maximum of DKK 22,800 per participant can be saved out of gross salary in 2010. The savings will be converted into Novo Nordisk B shares at the market price on 7 December 2010 contingent on continued employment. The shares will be restricted until January 2018. Approximately 8,400 employees elected to participate in the programme corresponding to 64% of the eligible employees. The total amount invested by employees will be approximately DKK 160 million. This programme is cost neutral to the company. Our long-term target for reduction of CO2 emissions was achieved at the end of 2009, well ahead of schedule. Targets for water and total energy consumption were also achieved. Social Performance on social dimensions continued on a positive trend with notable progress on all dimensions: people (employees), patients and communities. See p 89. The ability to manage global growth and stimulate productivity and innovation is tracked via the internal facilitation process and a set of engagement scores in the annual employee survey, eVoice. In 2009, the consolidated score (on a scale of 1–5, with 5 being best) was 4.3, an increase of 0.1 from 2008. Annual scores have been consistently above the long-term target of maintaining a level of 4.0 or above. Similarly, the level of fulfilment of action points from facilitations of local units’ adherence to the Novo Nordisk Way of Management was 93% in 2009, against a long-term target to maintain a level of 80% or above. In 2008, we set a five-year goal to have diversity in terms of gender and nationality in all senior management teams. Achievement of this goal relies on training, talent management and succession planning; activities that have all been scaled up and intensified during the 12 months since the launch of a renewed strategy for diversity management. At the end of 2009, 50% of the senior management teams met the diversity criteria, an increase from 43% at the end of 2008. 6 8 10 People In 2009, we onboarded 4,640 new employees, compared to 4,496 in 2008. The global growth trend continues as projected, with Europe and International Operations leading the expansion. At the end of 2009, the total number of employees was 29,329, which corresponds to 28,809 full-time positions. The total number of employees increased by 8%, from 27,068 at the end of 2008. Net financials and tax Net financials showed a net expense of DKK 945 million in 2009 compared to a net income of DKK 322 million in 2008. Included in net financials is the result from associated companies with an expense of DKK 55 million, primarily related to Novo Nordisk’s share of losses in ZymoGenetics, Inc. In 2008, the result from associated companies was an expense of DKK 124 million. For 2009, the foreign exchange result was an expense of DKK 751 million compared to an income of DKK 141 million in 2008. This development reflects losses on foreign exchange hedging of especially US dollars and Japanese yen, due to the appreciation of these currencies versus Danish kroner in 2009 compared to the exchange rate level prevailing in 2008. The effective tax rate was 23.0%, a decrease from 24.0% in 2008. Holding of treasury shares and reduction of share capital As per 2 February 2010, Novo Nordisk A/S and its wholly-owned affiliates owned 32,137,945 of its own B shares, corresponding to 5.2% of the total share capital. In order to maintain capital structure flexibility, the Board of Directors at the Annual General Meeting in 2010 will also propose a reduction in the B share capital from DKK 512,512,800 to DKK 492,512,800 by cancelling 20,000,000 B shares of DKK 1 from the company’s own holdings of B shares at a nominal value of DKK 20,000,000, equivalent to 3.2% of the total share capital. After implementation of the share capital reduction, the company’s share capital will amount to DKK 600,000,000 divided into an A share capital of DKK 107,487,200 and a B share capital of DKK 492,512,800. 1,000 full-time positions Full-time positions Geographical areas Denmark Europe (excl Denmark) North America International Operations Japan & Oceania 2009 2008 2007 2006 2005 0 DKK million 2.0 1.8 1.6 1.4 1.2 2005 2006 2007 2008 10 20 28.8 26.6 25.5 23.2 22.0 Patients Changing Diabetes®, our commitment to give people with diabetes priority, drive health outcomes and break the curve of the diabetes pandemic, aims to deliver sustainable positive impacts for people with diabetes. Efforts are being made to improve systematic measuring, tracking and reporting on outcomes, from a patient perspective as well as the socioeconomic implications, of corporate-driven programmes as well as local initiatives. Developing healthcare capacity to improve the ability to diagnose and treat diabetes is key to achieving sustainable results in terms of improved access to care and personal health. Over the years, our investments in training and education of healthcare professionals have been significantly scaled up. Since 2002, we have conducted training programmes for a total of 805,000 healthcare professionals worldwide. During 2009, we also reached out to 416,000 people with diabetes, offering training on how to manage their condition. Our pricing policy for people with diabetes in the world’s poorest countries (LDCs), in place since 2001, is now well-established in these markets. In 2009, we sold insulin at or below the policy price, not to exceed 20% of the average prices in the Western world, to 36 out of all 49 LDCs, up from 32 out of 50 in 2008. Our long-term goal is for the differential pricing to be adopted in all LDCs. 30 Sales per full-time position Sales per full-time position Capital expenditure and free cash flow Net capital expenditure for property, plant and equipment for 2009 was realised at DKK 2.6 billion compared to DKK 1.8 billion in 2008. The main investment projects in 2009 were the insulin filling plant in Tianjin, China, and new device manufacturing lines in Denmark. Free cash flow for 2009 was realised at DKK 12.3 billion compared to DKK 11.0 billion in 2008. The higher cash flow is driven by higher net profit and lower income taxes paid, countered by increased capital expenditure during 2009. Legal issues Novo Nordisk is party to a number of legal cases. See key legal issues and information on contingencies for pending litigations on pp 84–85. 2009 Non-financial performance Strategic management of the direct and indirect economic, social and environmental impacts of our activities reduces risk and strengthens competitiveness. Managing our business using the Triple Bottom Line business principle helps ensure that decisions are balanced and take a long-term view, with the objective of protecting and enhancing shareholder and societal value. See pp 28–36. Climate strategy impact Sales (left) CO2 emissions (right) DKK billion 70 60 50 40 30 1,000 tons 300 240 180 120 60 Equity Total equity was DKK 35,734 million at the end of 2009, equivalent to 65% of total assets, unchanged from the end of 2008. 2005 2006 2007 2008 2009 2009 performance against long-term non-financial targets Long-term non-financial targets guide the company’s sustainabilitydriven priorities in an increasingly dynamic business environment. Focus is on maximising positive social impacts by improving access to and quality of care and effectively managing resources to minimise environmental impacts. During 2009, we met our long-term targets related to employee engagement and adherence to the Novo Nordisk Way of Management. We also made progress towards the diversity target we set in 2008. As a measure of our progress in expanding access to diabetes care, we also made progress in increasing adoption of our long-established differential pricing policy for insulin sales in least developed countries (LDCs). In the same period, employee turnover decreased from 12.1% to 8.3%, reflecting a continuous focus on retention which was likely reinforced by the economic environment. Via the multiplier effect, the employment impact in 2009 – ie the number of jobs created in the supply chain and through employees’ private consumption – was 96,500 jobs worldwide. Most notably, of the total increase of 8,000 the largest portion is estimated to be in International Operations. Our 2009 accomplishments and results Productivity continued to increase, with sales per full-time position at an average of DKK 1.8 million, compared to DKK 1.7 million in 2008. Environment Performance on environmental dimensions also improved, and we successfully exceeded long-term targets for reduction of CO2 emissions, water consumption and total energy consumption. Our environmental targets and performance management focus on impacts from production. See p 89. Proposed dividend At the Annual General Meeting on 24 March 2010, the Board of Directors will propose a 25% increase in dividend to DKK 7.50 per share of DKK 1, corresponding to a pay-out ratio of 40.9%, compared to 37.8% for the financial year 2008. No dividend will be paid on the company’s holding of treasury B shares. Climate action Our aim has been to decouple environmental impacts from production growth and this has now been accomplished for CO2 emissions. At the end of 2009, we surpassed our 2014 target of a 10% absolute reduction compared to 2004 – well ahead of time. This accomplishment is the result of energy savings in all production facilities globally. Savings from energy reductions in Denmark have been earmarked to purchase wind energy to supply power for Danish operations from Horns Rev 2 – an Share repurchase programme During 2009, Novo Nordisk repurchased 21,661,949 B shares at an average price of DKK 301 per share, equivalent to a cash value of DKK 6.5 billion, completing the share repurchase programme of DKK 19 billion initiated in 2006. Our 2009 accomplishments and results Performance highlights Novo Nordisk Annual Report 2009 10 Novo Nordisk Annual Report 2009 11 DKK million 2005 7,298 13,543 1,463 1,708 24,012 5,064 2,781 1,565 338 9,748 33,760 9,532 14,020 5,497 4,711 33,760 15% 1% 16% 1,930 8,088 8,088 146 8,234 5,864 41,960 27,634 3,665 4,833 2006 10,825 13,451 1,606 1,984 27,866 5,635 3,309 1,607 326 10,877 38,743 12,280 15,300 6,494 4,669 38,743 16% (1%) 15% 2,142 9,119 9,119 45 9,164 6,452 44,692 30,122 2,787 4,707 2007 14,008 12,572 1,749 2,149 30,478 5,865 3,511 1,668 309 11,353 41,831 13,746 16,350 7,295 4,440 41,831 13% (5%) 8% 3,007 8,942 10,267 2,029 10,971 8,522 47,731 32,182 2,268 9,012 2008 17,317 11,804 1,844 2,391 33,356 6,396 3,865 1,612 324 12,197 45,553 15,154 17,219 8,425 4,755 45,553 12% (3%) 9% 2,442 12,373 12,698 322 12,695 9,645 50,603 32,979 1,754 11,015 2009 21,471 11,315 2,064 2,652 37,502 7,072 4,401 1,744 359 13,576 51,078 18,279 17,540 9,826 5,433 51,078 11% 1% 12% 2,551 14,933 14,933 (945) 13,988 10,768 54,742 35,734 2,631 12,332 2008–2009 Change 4,154 (489) 220 261 4,146 676 536 132 35 1,379 5,525 3,125 321 1,401 678 5,525 Employees: North America Europe International Operations Japan & Oceania Total employees Employment impact worldwide (direct and indirect): North America Europe International Operations Japan & Oceania Total employment impact (direct and indirect) 2005 2006 2007 2008 2009 2008–2009 Change Sales Modern insulins (insulin analogues) Human insulin Protein-related sales Oral antidiabetic products (OAD) Social performance Diabetes care total NovoSeven® Norditropin® Hormone replacement therapy Other products Biopharmaceuticals total Total sales by business segment North America Europe1 International Operations1 Japan & Oceania Total sales by geographical segment Increase in sales prices and volume/product mix Currency effect (local currency impact) Total sales increase as reported Depreciation, amortisation and impairment losses Operating profit Operating profit (excl AERx®)2 Net financials Profit before income taxes Net profit Total assets Equity Investments in property, plant and equipment (net) Free cash flow3 2,482 15,582 3,510 886 22,460 2,850 15,577 4,199 987 23,613 3,940 16,100 4,943 1,025 26,008 3,727 16,721 5,587 1,033 27,068 4,076 17,686 6,557 1,010 29,329 349 965 970 (23) 2,261 6,785 59,172 9,686 2,373 78,000 7,466 61,160 11,616 2,507 82,700 10,522 54,384 14,085 2,583 81,600 10,004 58,770 17,148 2,604 88,500 10,896 61,533 21,429 2,616 96,500 892 2,763 4,281 12 8,000 Long-term social targets 80% or above up to 2014 4.0 or above up to 2014 100% by 2014 0 100% Improve (or maintain) Change Fulfilment of action points from facilitations of the NNWoM (%)6 Engaging culture (employee engagement) on a scale of 1–57 Diverse senior management teams (%)8 Ratios, scales and numbers 88 – – 1 64 74.3 88 4.0 – 0 68 73.8 91 4.1 – 0 72 74.0 92 4.2 43 0 64 72.4 93 4.3 50 0 74 76.3 Financial performance 109 2,560 2,235 (1,267) 1,293 1,123 4,139 2,755 877 1,317 Warning letters and re-inspections LDCs9 where Novo Nordisk sells insulin according to the differential pricing policy (%) Company reputation with external key stakeholders on a scale of 0–10010 Diabetes care: Energy consumption (1,000 GJ) Water consumption (1,000 m3) CO2 emissions from energy consumption (1,000 tons) Biopharmaceuticals: Energy consumption (1,000 GJ) Water consumption (1,000 m3) CO2 emissions from energy consumption (1,000 tons) Other:11 Energy consumption (1,000 GJ) Water consumption (1,000 m3) CO2 emissions from energy consumption (1,000 tons) Environmental performance – – – – – – – – – 1,916 2,625 164 335 186 32 461 184 33 2,182 2,907 177 323 175 30 279 149 29 1,803 2,377 146 302 166 28 428 141 41 1,544 1,817 99 292 143 19 410 189 28 (259) (560) (47) (10) (23) (9) (18) 48 (13) Long-term environmental targets 11% reduction by 2011 compared to 2007 11% reduction by 2011 compared to 2007 10% reduction by 2014 compared to 2004 Financial ratios Sales in percent: Modern insulins (insulin analogues) Diabetes care total Biopharmaceuticals total Percentage of sales Sales outside Denmark Sales and distribution costs Research and development costs Research and development costs (excl AERx®)2 Administrative expenses Gross margin3 Net profit margin3 Effective tax rate3 Equity ratio3 Return on equity3 Payout ratio3 Payout ratio adjusted for impact of Dako and AERx® 21.6% 71.1% 28.9% 99.2% 28.7% 15.1% 15.1% 6.3% 72.8% 17.4% 28.8% 65.9% 21.7% 33.2% 33.2% 27.9% 71.9% 28.1% 99.2% 30.0% 16.3% 16.3% 6.2% 75.3% 16.7% 29.6% 67.4% 22.3% 34.4% 34.4% 33.5% 72.9% 27.1% 99.2% 29.6% 20.4% 17.2% 6.0% 76.6% 20.4% 22.3% 67.4% 27.4% 32.8% 34.9% 38.0% 73.2% 26.8% 99.2% 28.2% 17.2% 16.5% 5.8% 77.8% 21.2% 24.0% 65.2% 29.6% 37.8% 37.8% 42.0% 73.4% 26.6% 99.2% 30.2% 15.4% 15.4% 5.4% 79.6% 21.1% 23.0% 65.3% 31.3% 40.9% 40.9% Long-term financial targets4 30% 15% 50% 80% Energy consumption (% change compared to 2007) Water consumption (% change compared to 2007) CO2 emissions from energy consumption (% change compared to 2004) Ratios – – 9 – – 9 – – 12 (9) (17) 2 (19) (34) (31) Operating profit margin Operating profit margin (excl AERx®)2 Growth in operating profit Growth in operating profit (excl AERx®)2 Growth in operating profit, three-year average Return on invested capital (ROIC)3 Cash to earnings Cash to earnings, three-year average Basic earnings per share/ADR in DKK Diluted earnings per share/ADR in DKK Dividend per share in DKK Ratios for long-term financial targets 24.0% 24.0% 15.9% 15.9% 11.0% 24.7% 82.4% 82.4% 8.95 8.92 3.00 23.5% 23.5% 12.7% 12.7% 12.4% 25.8% 73.0% 80.2% 10.05 10.00 3.50 21.4% 24.5% (1.9%) 12.6% 8.9% 27.2% 105.7% 87.0% 13.49 13.39 4.50 27.2% 27.9% 38.4% 23.7% 16.4% 37.4% 114.2% 97.6% 15.66 15.54 6.00 29.2% 29.2% 20.7% 20.7% 19.1% 47.3% 114.5% 111.5% 17.97 17.82 7.50 Share ratios5 1 Comparative sales figures for 2005 and 2006 have been adjusted in order to reflect a changed organisational structure from 1 January 2007 which transferred eight countries, including Bulgaria and Romania, from Region International Operations to Region Europe. 2 Excluding costs related to the discontinuation of pulmonary diabetes projects in 2007. 3 For definitions, please refer to p. 88. 4 The long-term financial targets were updated in January 2009. 5 In 2007, there was a stock split of the company’s A and B shares. The trade unit was changed from DKK 2 to DKK 1. The comparative figures for 2005 and 2006 have been updated accordingly. 6 NNWoM is an abbreviation of the Novo Nordisk Way of Management. 7 Based on eVoice, an employee survey using a scale of 1–5, with 5 being the best. 8 Diverse in terms of gender and nationality. 9 The Least Developed Countries as defined by the UN. 10 Company reputation is measured by an independent external consultancy firm. 11 ‘Other’ consists of consumption and emissions that cannot directly be linked to the production of either diabetes care or biopharmaceuticals. Diabetes care Creating value by improving treatment outcomes Novo Nordisk has been in the business of diabetes for 85 years and has pioneered many therapeutic breakthroughs in diabetes care. Today, diabetes remains our primary focus, accounting for 73% of 2009 sales. The company is the market leader with 51% of the total insulin market and 45% of the modern insulin (insulin analogue) market, based on volume, at year end. Diabetes is a metabolic disorder affecting the way our bodies use digested food for growth and energy. Much of the food we eat is broken down into glucose, the form of sugar in the blood. Glucose is the main source of fuel for the body. When we eat, the pancreas automatically produces the right amount of insulin to move glucose from blood into our cells. In people with diabetes, however, the pancreas either produces little or no insulin or the cells do not respond appropriately to the insulin that is produced. We are dedicated to creating value for patients by changing diabetes – changing how it is treated, how it is viewed around the world, and how the future of the disease evolves. While we seek to offer innovative solutions that fit the way people want to live, changing diabetes cannot be achieved through science alone. We have to effect change at every level: in research, in education, in public policy, and in humanitarian and outreach efforts. Diabetes care commercial perspective, moving into prediabetes and obesity treatment offers attractive potential, but also many challenges. “Our commercial strategy is to expand our global leadership within modern insulin, gain GLP-1 leadership and continue to offer innovations, including devices, that address unmet medical needs,” says Kåre Schultz, executive vice president and chief operating officer. 14 also been granted in the US and Japan and we will launch the product in both markets in 2010. Victoza®: a treatment revolution Expert clinical practice shows that successful treatment of type 2 diabetes requires a patient-centred approach: focusing solely on glucose management is not enough. Many treatments for diabetes available up to now have involved trade-offs for patients and physicians. While effective at lowering blood glucose, many treatments can induce low blood sugar episodes (hypoglycaemia), weight gain and other side effects. It is known that some patients do not take their medicines regularly to reduce such side effects. Diabetes is a progressive chronic disease and, to maintain blood glucose levels over time, insulin may be introduced following lifestyle changes and initiation of metformin or GLP-1 therapy. As a third step, treatment guidelines recommend transition to intensive insulin therapy to maintain glucose targets. Maintaining tight glucose control is associated with fewer serious complications and better treatment outcomes. By engineering proteins we have created a portfolio of modern insulins that offer options for individual treatment needs to achieve improved blood glucose control. For insulin initiation, treatment can include either a long-acting modern insulin or a modern premix insulin with dual release to cover both mealtime and basal requirements. Insulin treatment can also be intensified in two ways, either with a modern premix insulin or by adding a rapid-acting modern insulin to the long-acting insulin at mealtimes. Our portfolio of modern insulins includes: • Levemir®, a soluble, long-acting modern insulin for once-daily use. • NovoRapid® (NovoLog® in the US), the world’s most widely used rapid-acting insulin for use at mealtimes. • NovoMix® 70/50/30 (NovoLog® Mix 70/30 in the US), a dualrelease modern insulin that covers both mealtime and basal requirements. Range of treatment options Our edge in scientific discovery and our expertise with proteins make us uniquely positioned to address the issues at the core of the diabetes epidemic: insulin deficiency and the complexities of treating it. Our goal is to offer people with diabetes, and their healthcare providers, a wide range of treatment options. We are the only company with a full portfolio of modern insulins. We also produce the most widely used prefilled and durable insulin pen devices in the world. Beginning with the first patients treated with insulin in the 1920s, we have been dedicated to continuously improving the safety, effectiveness and convenience of diabetes treatment. Our leadership position within diabetes care is bolstered by the fact that we are the only company with two new-generation insulins in late-stage clinical development. If successful, this new generation of insulins is expected to offer even better treatment outcomes and convenience for people with diabetes. Novo Nordisk is looking at new ways to prevent type 2 diabetes by treating its prestages, including obesity, which is known to be a major risk factor in developing type 2 diabetes. We are conducting a phase 3 trial for liraglutide treatment of obesity. From a Photo: To improve treatment compliance and outcomes, we look for new ways to make it easier for people with diabetes to take insulin and make sure that products more closely resemble the body’s natural insulin curve. Ib Jonassen, senior principal scientist and project director, Diabetes Protein Engineering, is one of the inventors of Degludec, a new insulin under development. Ultra-long-acting Degludec is in phase 3 clinical trials. GLP-1 gives patients and their healthcare providers an important new tool in managing the multiple aspects of diabetes. Glucagon-Like Peptide-1 (GLP-1) is a hormone from the human gut involved in glucose regulation. New GLP-1 therapies are a major innovation in the treatment of type 2 diabetes: they lower glucose while having a low risk of triggering hypoglycaemia, and in most patients also support weight loss. In type 2 diabetes, the ability of the pancreas to release insulin in the presence of glucose is impaired. GLP-1 therapies help address this defect by directly acting on the pancreas. Our new, long-acting, human GLP-1 analogue, Victoza® (liraglutide), was approved in the EU in 2009 on the basis of the LEAD™ phase 3 programme. LEAD™ (Liraglutide Effect and Action in Diabetes) comprised five randomised, controlled, double-blind studies involving 6,500 patients in 40 countries. LEAD™ demonstrated the strong safety and efficacy profile of Victoza® used alone or in combination with other diabetes therapies. Two of the trials with large patient populations, LEAD™ 2 and LEAD™ 3, have been extended for 18 months and three years, respectively. “Victoza® is off to a great start. Feedback from patients and physicians is extremely positive – and reveals how Victoza® delivers much more than reduced blood sugar,” explains Jakob Riis, senior vice president, Liraglutide. We launched Victoza® in nine European markets during the second half of 2009 and will continue the European roll-out throughout 2010. As of January 2010, regulatory approval has Better glucose control The Treat-to-Target study for type 2 diabetes, published in the New England Journal of Medicine in October 2009, evaluated three different treatment regimens using Novo Nordisk insulins over three years1. DKK billion Diabetes care Sales development Modern insulins Human insulins Protein-related products Oral antidiabetic products (OAD) 2009 2008 2007 2006 2005 0 DKK billion 10 20 37.5 33.4 30.5 27.9 24.0 30 40 Modern insulins Sales development NovoRapid NovoMix® Levemir® ® 2009 2008 2007 2006 2005 0 5 7.3 10.8 14.0 17.3 21.5 10 15 20 25 Our impact on society We hold ourselves accountable to shareholders and other stakeholders that may affect or be affected by the company’s activities. As a business, Novo Nordisk generates wealth for society and contributes to socioeconomic development through sustainable business practices, investment and employment. As a pharmaceutical innovator, we provide knowledge, research and development and healthcare products. Our outreach programmes also improve awareness, diagnosis and treatment. Novo Nordisk Annual Report 2009 19 Diabetes care Modern insulin portfolio Novo Nordisk Annual Report 2009 Novo Nordisk Annual Report 2009 15 18 Novo Nordisk Annual Report 2009 Engaging stakeholders The burdens of chronic disease will grow and challenge societies in new ways as the global population expands and ages and increasing urbanisation contributes to more sedentary lifestyles. By involving stakeholders and working in partnership, we believe we can better understand these challenges and cocreate solutions that are more likely to succeed. Our key stakeholders are patients. We engage with all other stakeholders – including healthcare providers, payers, employees, investors, suppliers and other business partners – in support of improved treatment outcomes for people with diabetes and other chronic diseases. Examples of our stakeholder engagement and partnerships are included in this section, but other examples can be found throughout this report and online at annualreport2009. novonordisk.com/stakeholder-engagement.aspx. aspects of diabetes and the attitudes, wishes and needs of people with diabetes. Initiated by Novo Nordisk in 2001, the survey included people with diabetes and healthcare professionals from 13 countries. Today, DAWN™ serves as a patient advocacy platform, calling for concerted action to improve diabetes care in more than 30 countries and influencing academic research, educational programmes and new approaches to treatment at hospitals and clinics. In some countries, national task forces and coalitions are now coordinating efforts to implement patient-centred care and community initiatives inspired by DAWN™ surveys. Since the DAWN™ study started in 2001, other international studies have been completed, including the DAWN™ MIND study. The DAWN™ MIND study aims to implement monitoring of well-being in people with diabetes as part of routine diabetes care. Monitoring helps identify psychological needs that are otherwise likely to stay unrecognised. We are also launching a psychosocial survey of people with all types of haemophilia to better understand their needs and wishes and help support efforts to improve care. See p 26. How we work Patients and those at risk Novo Nordisk’s products are sold to hospitals, doctors and healthcare professionals for treatment of their patients. Novo Nordisk has a 51% market share of the global insulin market (by volume). We also advocate on behalf of patients for systemic healthcare change to support chronic disease management. See pp 20–23 and p 93. How we engage Long-term partnerships have for many years created value for Novo Nordisk and for society. We partner with others to address societal problems that are integral to our long-term business success, to leverage our assets and expertise to deal with the problem, to play a role in mobilising stakeholders and driving concerted action, and finally to measure and learn from results. Recognising the complexity of climate change, we have taken a partnership approach to address it, teaming up with others who have specialist knowledge in the field. Our CO2 reduction target was set in close collaboration with the World Wildlife Fund (WWF) under the WWF Climate Savers Programme. Our ongoing partnership with DONG Energy (see p 36) has allowed us to find a cost-neutral way of converting power supplies for our Danish operations to wind energy, an important element in achieving the target. When setting the target, we shared internal data with WWF and had a very open dialogue. WWF challenged us to set the bar higher than we would have otherwise done. Collaborating for innovation Our commercial focus is on a few mutually re-enforcing proteinbased therapeutic areas. Within each, we are committed to improving the quality of life for people living with the particular disease. We search for innovative biologics at all stages of development, from early discovery to clinical phases. Always a pioneer in scientific innovation, we have entered into preliminary collaborations with biotechnology-based research companies, resulting in many technological advances. These include our work with research and development companies to formulate therapeutic proteins and generate human monoclonal antibodies. One example of our success in collaborating to drive innovation is our clinical development of oral insulin and GLP-1 formulations. See p 20. Our people Employees’ knowledge and productivity are a major part of the company’s intangible value. Our employees contribute to the communities in which we operate through volunteerism and payroll taxes. See pp 32–33 and annualreport2009.novonordisk.com/ social/employee-volunteering.aspx. Shareholders and business partners We aim to communicate openly with shareholders about the company’s financial and business development as well as strategies and targets. See pp 47–49. We also purchase resources and inputs from more than 38,000 suppliers. See annualreport2009. novonordisk.com/social/responsiblesourcing.aspx. Novo Nordisk Public sector Tax payments fund services offered by the public sector. Novo Nordisk’s tax payments are an estimated 2.9% of corporate taxes in Denmark. In total, Novo Nordisk’s income taxes in Denmark for the year amounted to 854 million Danish kroner. See p 65 and annualreport2009.novonordisk. com/financial-economics/tax.aspx. Environment We use water, energy and other raw materials to produce therapies for patients. As a result of our operations, we produce emissions and waste. Managing our environmental impact and resource consumption reduces our costs and minimises our impact on the environment. See pp 93 and 95 and annualreport2009.novonordisk. com/environment.aspx. Communities As a business, Novo Nordisk generates wealth for society and contributes to socioeconomic development through its sustainable business practices, investment and employment (estimated direct and indirect impact amounting to 96,500 jobs globally). See p 94 and annualreport2009.novonordisk. com/social/donations.aspx. The UN Resolution on diabetes, adopted in December 2006 to increase awareness of the growing diabetes pandemic and develop policies for the prevention, treatment and care of diabetes, is one example of the kind of change that is possible through long-term partnerships. It was the result of a multistakeholder campaign led by the International Diabetes Federation in which Novo Nordisk was an active and supportive partner. It recognises the urgent need to pursue multilateral efforts to promote and improve human health and encourages UN member states to have strategies for diabetes prevention, diagnosis and treatment as part of the sustainable development of healthcare systems. By involving stakeholders and working in partnership, we believe we can better understand healthcare challenges and cocreate solutions that are more likely to succeed. Our responsible sourcing programme is another example of how our commitment to partner with others is integrated in the way we do business. The programme also underpins the company’s commitment to the UN Global Compact and the Universal Declaration of Human Rights. We have established a methodology for assessing our supplier base, including screening principles and a model to map and manage social and environmental risks relevant for different types of procurement. Patient support Our core business is to help people, seeking to reduce suffering and improve health. Our commitment to patients is paramount, and engaging with patients and patient organisations and understanding their needs is an important part of how we work. An example of the value of patient dialogue is the DAWN programme – the largest global survey to uncover the psychosocial ™ 30 Novo Nordisk Annual Report 2009 Novo Nordisk Annual Report 2009 31 www.blacksunplc.com © Black Sun Plc 2011 35 How we work Our 2009 accomplishments and results
