Norwegian Fund Abstains from Voting on Novo Nordisk

The Norwegian sovereign wealth fund announced that it would abstain from voting for new board members, particularly for the chairmanship, at the extraordinary shareholders' meeting of Novo Nordisk on November 14.

This decision comes amidst a leadership change atmosphere at the Danish pharmaceutical manufacturer, with current chairman Helge Lund and six independent board members expected to resign due to tensions with the Novo Nordisk Foundation, which holds controlling stakes in the company.

Officials stated that the foundation intends to bring in its own chairman, Lars Rebien Sorensen, to lead the board, given that the foundation controls the majority of Novo’s voting rights through its investment arm, Novo Holdings.

The Norwegian fund did not specify the reason for its abstention.

The Novo Nordisk Foundation criticized the surprisingly resigning board for being slow to address challenges in the critical U.S. market. Furthermore, it called for a focus on rapid growth in direct-to-consumer and mass markets, expressing hesitation over leadership changes.

Sorensen, despite wanting broad changes in the foundation's board, expressed confidence in the new CEO Mike Doustdar. Doustdar, who began his tenure in August, has attempted to focus the company on its core markets while implementing layoffs.

Last month, Novo stated that it was "impossible to reach a common understanding" regarding the composition of the board, leading to the departure of the independent board members.

Sorensen downplayed the dispute, stating that he did not wish to describe the situation as a "coup." He noted that these changes aim to strengthen Novo's position in the U.S., emphasizing that its business model there is "highly operational."

On Monday, Novo Nordisk shares rose more than 3% after the Wegovy producer withdrew its bid for the U.S. weight loss drug developer Metsera. This marked the end of a takeover battle with Pfizer.

Pfizer announced on Friday evening that it had reached a deal to acquire Metsera for 10 billion dollars, a move that dealt a blow to Novo's efforts to close the gap with Eli Lilly in the rapidly growing obesity market.

Metsera reported that it accepted Pfizer's improved offer; although Novo's bid was more attractive, the company had concerns regarding competition law risks. Novo confirmed on Saturday that it would withdraw from this offer.

This agreement provides Pfizer with a foothold in the lucrative weight loss segment, while it is reported that Metsera's experimental treatments will take several more years to commercialize.