NVO Novo Nordisk

OUTLOOK

OUTLOOK 2017

The current expectations for 2017 are summarised in the table below:

For 2017, sales growth is now expected to be in the range of 1% to 3% growth, measured in local currencies. This reflects expectations for continued robust performance for Victoza ® and Tresiba ® as well as a contribution from Saxenda ® and Xultophy ® . This is expected to be partly countered by an impact from lower realised prices in the USA, especially in the basal insulin and growth hormone segments, the loss of exclusivity for Vagifem ® in the USA, further intensifying competition within diabetes and biopharmaceuticals especially in the USA, as well as adverse macroeconomic conditions in several markets in International Operations. Given the significant 8% depreciation of the US dollar and most other key invoicing currencies versus the Euro and the Danish krone since the report for the first three months of 2017, growth reported in DKK is now expected to be around 3 percentage points lower than the local currency level.

For 2018, formulary negotiations with Pharmacy Benefit Managers and managed care organisations in the USA are progressing. Subject to the final outcome of these negotiations, average prices after rebates are expected to be lower compared with the levels in 2017, predominantly driven by the basal insulin segment. The market access for Novo Nordisk’s key products is, however, expected to remain broadly unchanged compared to 2017.

For 2017, operating profit growth is now expected to be in the range of 1% to 5% growth, measured in local currencies. The expectation for operating profit growth primarily reflects the modest outlook for sales growth. The outlook also reflects an increase in second half of 2017 in the sales and distribution cost ratio to support commercialisation efforts for key products as well as in the research and development cost ratio to support the progress of Novo Nordisk’s pipeline. Given the current

exchange rates versus the Danish krone, growth reported in DKK is now expected to be around 4 percentage points lower than the local currency level.

For 2017, Novo Nordisk now expects financial items (net) to amount to a loss of around DKK 0.2 billion. The current expectation reflects losses on non-hedged currencies partly offset by gains associated with foreign exchange hedging contracts, mainly related to the US dollar and Japanese yen versus the Danish krone.

The effective tax rate for 2017 is now expected to be in the range of 21-22%, a level broadly similar to the statutory corporate tax rate in Denmark of 22%.

Capital expenditure is now expected to be around DKK 9.5 billion in 2017, primarily related to investments in additional capacity for active pharmaceutical ingredient production within diabetes care, a capacity expansion of the diabetes care filling and an expansion of the manufacturing capacity for biopharmaceutical products. Depreciation, amortisation and impairment losses are still expected to be around DKK 3.0 billion. Free cash flow is still expected to be DKK 29-33 billion.

All of the above expectations are based on the assumptions that the global economic and political environment will not significantly change business conditions for Novo Nordisk during 2017, and that currency exchange rates, especially the US dollar, will remain at the current level versus the Danish krone. Please refer to appendix 7 for key currency assumptions.

Novo Nordisk has hedged expected net cash flows in a number of invoicing currencies and, all other things being equal, movements in key invoicing currencies will impact Novo Nordisk’s operating profit as outlined in the table below.

* Chinese yuan traded offshore (CNH) used as proxy when hedging Novo Nordisk’s CNY currency exposure

The financial impact from foreign exchange hedging is included in Financial items (net).

RESEARCH & DEVELOPMENT UPDATE

DIABETES

Novo Nordisk submits applications in the USA and the EU for including data from the DEVOTE trial in the Tresiba ® (NN1250) label

In May 2017, Novo Nordisk announced the submission of a supplemental application to the US Food and Drug Administration (FDA) for including data in the label for Tresiba ® (insulin degludec) from the DEVOTE trial, a long-term, randomised, double-blinded and event-driven trial conducted to confirm the cardiovascular safety of Tresiba ® compared to insulin glargine U100 when added to standard of care, in people with type 2 diabetes. Furthermore, in June 2017 Novo Nordisk announced the submission of a Type II variation application to the European Medicines Agency (EMA) for including data from the DEVOTE trial in the label for Tresiba ® .

In the DEVOTE trial, the primary endpoint was achieved by demonstrating non- inferiority of major adverse cardiovascular events (MACE) with Tresiba ® compared to insulin glargine U100. The trial thereby confirmed the results of the DEVOTE interim analysis submitted to the FDA in March 2015, on the basis of which Tresiba ® and Ryzodeg ® 70/30 were approved in the US in September 2015.

The primary endpoint of the DEVOTE study was defined as the composite MACE outcome of the first occurrence of cardiovascular death, non-fatal myocardial infarction or non-fatal stroke and showed a hazard ratio of 0.91 in favour of Tresiba ® relative to insulin glargine U100, with no statistically significant difference between the two treatments.

From a mean HbA 1c baseline of 8.4%, the trial showed a similar blood sugar reduction with Tresiba ® compared to insulin glargine U100 with an end-of-trial treatment difference of 0.01 percentage point between the two treatment arms, thus fulfilling the requirements for objectively comparing hypoglycaemia rates between the two treatments.

In the trial, Tresiba ® demonstrated superiority on the secondary confirmatory endpoint of severe hypoglycaemia: 27% fewer patients in the group treated with Tresiba ® experienced an episode of severe hypoglycaemia, resulting in a 40% overall rate reduction of total episodes of adjudicated severe hypoglycaemia. Furthermore, patients in the group treated with Tresiba ® experienced a 53% relative reduction in the rate of nocturnal severe hypoglycaemia. These differences were all statistically significant.

Tresiba ® appeared to have a safe and well-tolerated profile consistent with previous clinical studies conducted with Tresiba ® .

Review of Novo Nordisk’s application in the USA for including data from the two SWITCH trials and the DEVOTE trial in the Tresiba ® (NN1250) label continues

In September 2016, Novo Nordisk announced the submission of a supplemental application to the FDA for including data from the two SWITCH phase 3b trials in the label for Tresiba ® . In the SWITCH trials, the safety profile and efficacy of Tresiba ® was compared with insulin glargine U100. FDA is continuing the review of the SWITCH application and it is Novo Nordisk’s assessment that FDA now plans to review the SWITCH studies in the context of the data from the recently submitted DEVOTE trial.

Victoza ® (NN2211) approved in the EU as the only GLP-1 with a label to include prevention of cardiovascular events

In July 2017, the European Commission approved an update to the Victoza ® (liraglutide) EU label that expands the indication to reflect both improving blood sugar and cardiovascular (CV) events as integral parts of type 2 diabetes treatment. Victoza ® is the only GLP-1 that is proven to prevent CV events in people with type 2 diabetes and high CV risk. The update of the label was based on the results from the LEADER trial. The trial investigated the long-term effects of Victoza ® in more than 9,300 people with type 2 diabetes, at high risk of major CV events.

In the LEADER trial, Victoza ® (liraglutide up to 1.8 mg) statistically significantly reduced the risk of CV death, non-fatal myocardial infarction (heart attack) or non-fatal stroke by 13% versus placebo, when added to standard of care. The overall risk reduction was driven by a statistically significant 22% reduction in CV death with Victoza ® treatment versus placebo and non-significant reductions in non-fatal myocardial infarction and non-fatal stroke.

Novo Nordisk received positive 17-2 vote from FDA Advisory Committee that Victoza ® (NN2211) provides substantial evidence of cardiovascular risk reduction in patients with type 2 diabetes

In June 2017, Novo Nordisk announced that the Endocrinologic and Metabolic Drugs Advisory Committee (EMDAC) of the FDA had completed its meeting regarding the supplemental New Drug Application (sNDA) for inclusion of the data from the cardiovascular outcomes trial LEADER in the label for Victoza ® .

The Advisory Committee voted 19-0 in favour of Victoza ® on the question: "Do the results of LEADER establish that use of Victoza ® in patients with type 2 diabetes is not associated with excess cardiovascular risk?"

The Advisory Committee voted 17-2 in favour of Victoza ® on the question: "Does the LEADER trial provide the substantial evidence needed to establish that Victoza ® (liraglutide 1.8 mg) reduces cardiovascular risk in patients with type 2 diabetes?"

The sNDA for Victoza ® was submitted to the FDA in October 2016 and regulatory feedback in the US is expected in Q3 2017.

American Diabetes Association (ADA) meeting 9-13 June 2017 in San Diego, California, USA

At the 77th annual meeting of the ADA held in San Diego, California, USA results from Novo Nordisk’s research and development activities were presented in 60 accepted abstracts. Among the key presentations was an ADA-hosted symposium where detailed data from the DEVOTE study were presented. DEVOTE is the first randomised, double- blind, treat-to-target, event-driven trial comparing two basal insulins, Tresiba ® and insulin glargine U100, in adults with type 2 diabetes at high risk of CV disease.

The results presented at ADA also comprised additional results from the LEADER trial with Victoza ® and a cross-trial comparison of the SUSTAIN 1 to 5 with the once-weekly GLP-1 analogue semaglutide. In addition, the phase 3b results from the DUAL VII trial were presented, demonstrating that Xultophy ® 100/3.6 reduced the risk of hypoglycaemic events and lowered body weight compared with a basal-bolus treatment in people with type 2 diabetes.

OBESITY

CHMP endorses EU label update of Saxenda ® (NN8022) based on the LEADER trial In June 2017, Novo Nordisk announced that CHMP, under the EMA, had endorsed an update of the EU label for Saxenda ® . The update was based on the results from the LEADER trial which investigated the long-term effects of Victoza ® in people with type 2 diabetes and established cardiovascular disease.

The CHMP has previously concluded that, although the Saxenda ® dosing of liraglutide 3.0 mg was not investigated in the LEADER trial, the results would also be supportive for the assessment of Saxenda ® for any potential cardiovascular risk. The Saxenda ® label has been updated with immediate effect to reflect the primary outcome of the LEADER trial.

Novo Nordisk reports up to 13.8% weight loss in people with obesity receiving semaglutide (NN9536) in phase 2 trial

In June 2017, Novo Nordisk announced the headline results from a 52-week double- blind phase 2 clinical trial with once-daily subcutaneous semaglutide investigating safety and potential for inducing and maintaining weight loss in people with obesity.

In the trial, 957 people with obesity were randomised to treatment with doses of semaglutide between 0.05 to 0.4 mg/day or placebo. Liraglutide 3.0 mg/day was included for comparison. Approximately 100 people were included in each active treatment arm in combination with diet and exercise. All people in the trial were treated for 52 weeks followed by a 7-week follow-up period.

From a mean baseline weight of around 111 kg and a body mass index of approximately 39 kg/m2, a weight loss up to 17.8 kg was observed after 52 weeks of treatment with semaglutide. This corresponded to an estimated 13.8% weight loss compared to the weight loss of 2.3% achieved by diet, exercise and placebo alone, with all treatment

arms adjusted for people discontinuing treatment in the study. The results from the liraglutide 3.0 mg treatment arm were broadly in line with previously reported data.

In the trial, once-daily semaglutide appeared to have a well-tolerated safety profile, with the most common adverse events being gastrointestinal side effects.

Novo Nordisk is now preparing the phase 3 programme with semaglutide with the objective to confirm the results, and the phase 3 programme is expected to begin in 2018

BIOPHARMACEUTICALS

Novo Nordisk received US FDA approval of REBINYN ® (nonacog beta pegol; N9-GP; NN7999)

In May 2017, Novo Nordisk announced that the FDA had approved the Biologics License Application for REBINYN ® for the treatment of adults and children with haemophilia B.

REBINYN ® is the brand name for nonacog beta pegol, N9-GP, in the USA. REBINYN ® is indicated for on-demand treatment and control of bleeding episodes and the perioperative management of bleeding around the time of surgery in adults and children with haemophilia B. The efficacy and safety evaluation was based on 115 patients across the five paradigm clinical trials, and the approval follows the Blood Products Advisory Committee meeting held 4 April 2017.

Novo Nordisk received EU approval of Refixia ® (nonacog beta pegol; N9-GP; NN7999) In June 2017, Novo Nordisk announced that the European Commission had granted marketing authorisation for Refixia ® for the treatment of adolescents and adults with haemophilia B. The authorisation covers all 28 European Union member states.

Refixia ® is the brand name for nonacog beta pegol, N9-GP, in the EU. Refixia ® is indicated for prophylaxis, on-demand treatment of bleeding and surgical procedures in adolescent (>12 years of age) and adult patients with haemophilia B (congenital factor IX deficiency). The efficacy and safety evaluation was based on 115 patients across the five paradigm clinical trials, and the marketing authorisation follows the positive opinion from the CHMP, under the EMA, provided 24 March 2017.

Novo Nordisk submits New Drug Application for nonacog beta pegol (N9-GP; N7999) in Japan

In July 2017, Novo Nordisk submitted the New Drug Application (NDA) to the Japanese Ministry of Health, Labour and Welfare for nonacog beta pegol (N9-GP). The filing of nonacog beta pegol is based on the results from the paradigm clinical trial programme, which involved 115 patients with severe or moderately severe haemophilia B. Nonacog beta pegol was found to be efficacious in routine prophylaxis, treatment of bleeding episodes and surgery for adults, adolescents and children. Furthermore, nonacog beta pegol appeared to be well-tolerated and no safety concerns were identified.

Positive results from phase 3 trial with long-acting growth hormone somapacitan (NN8640) for treatment of Adult Growth Hormone Deficiency (AGHD).

In August 2017, Novo Nordisk completed the main phase of REAL 1, the pivotal phase 3 trial with the long-acting recombinant growth hormone, somapacitan. REAL 1 was a 34- week trial that enrolled 301 treatment-naïve adults with growth hormone deficiency. The trial was a placebo-controlled efficacy trial with the primary endpoint being change in truncal fat percentage from baseline to 34 weeks. At the end of the trial, there was a statistically significant difference between somapacitan and placebo, with the somapacitan-treated patients showing a greater reduction in truncal fat percentage.

Somapacitan also demonstrated significant beneficial effects on other body composition measures such as lean body mass (LBM) and visceral fat tissue. The safety profile observed in this study was consistent with that known for Norditropin ® .

Novo Nordisk will soon finalise recruitment in REAL 3, a phase 2 study in prepubertal growth hormone deficient (GHD) children evaluating weekly treatment with once-weekly somapacitan versus daily injections of Norditropin ® . In addition, Novo Nordisk is planning for the pivotal phase 3 somapacitan programs in GHD children as well as in children born small for gestational age (SGA).

SUSTAINABILITY UPDATE

The number of employees in Novo Nordisk decreased by 2.2%

The number of full-time equivalent employees at the end of the first six months of 2017 decreased by 2.2% compared with 12 months ago. The total number of employees was 41,833, corresponding to 41,385 full-time positions. The decrease is the result of workforce reductions, effectuated in the last quarter of 2016, in North America Operations, Region Europe and R&D, and the transfer of the activities and employees of the Steno Diabetes Center to the Capital Region of Denmark. Areas in which there was notable growth include Region AAMEO and the Global Service Centre in Bangalore.

Novo Nordisk replaces cartridge holders for insulin pens to protect patient safety

In June 2017, Novo Nordisk detected a potential safety issue with some batches of NovoPen Echo ® and NovoPen ® 5, used for insulin treatment by people with diabetes. The insulin cartridge holder may crack or break if exposed to certain chemicals in for example cleaning agents, and as a result the pen may give a slightly smaller dose of insulin than expected. The risk that a patient will experience high blood sugar over the lifetime of an affected pen is less than 0.1%. The affected pens had been distributed in 38 countries. In the interest of patient safety, Novo Nordisk immediately put in place measures by which cartridge holders distributed to patients could be replaced. Affected pens in stock at wholesalers and pharmacies have been recalled. The issue has thereby been mitigated.

Novo Nordisk signs agreement that secures CO 2 neutral steam and heating for the company’s largest production facility

In June 2017, Novo Nordisk signed a 20-year contract with the Danish energy company, DONG Energy, to secure stable supplies of CO 2 neutral steam and heating to the

company’s largest production facility in Kalundborg, Denmark. Based on this agreement DONG Energy will rebuild its Asnæs Power Station, which supplies Novo Nordisk’s site in Kalundborg, so that by 2020 coal is replaced with sustainable wood chips as the primary source for producing steam and heating. As a result, the Novo Nordisk site will by then be CO 2 neutral, and total CO 2 emissions from the company’s global production will be reduced by 45%.

EQUITY

Total equity was DKK 48,436 million at the end of the first six months of 2017, equivalent to 49.5% of total assets, compared with 48.2% at the end of the first six months of 2016. Please refer to appendix 5 for further elaboration of changes in equity.

Interim dividend

The Board of Directors has decided to pay out interim dividend for 2017 of DKK 3.00 for each Novo Nordisk A and B share of DKK 0.20, which will be paid in August 2017. The ex-dividend date for the interim dividend will be 18 August 2017. The record date will be 21 August 2017 for the A and B shares as well as ADRs. The payment date for the A and B shares will be 22 August 2017, while the payment date for the ADRs will be 29 August 2017. No dividend will be paid on the company’s holding of B shares.

2017 share repurchase programme

On 3 May 2017, Novo Nordisk announced a share repurchase programme of up to DKK 4.3 billion to be executed from 3 May to 7 August 2017, as part of an overall 2017 programme of up to DKK 16 billion to be executed during a 12-month period. The purpose of the programme was to reduce the company’s share capital and to meet obligations arising from share-based incentive programmes. Under the programme, Novo Nordisk has repurchased 15,465,578 B shares for an amount of DKK 4.3 billion in the period from 3 May to 7 August 2017. The programme was concluded on 7 August 2017.

As of 7 August 2017, Novo Nordisk A/S and its wholly-owned affiliates owned 33,054,841 of its own B shares, corresponding to 1.3% of the total share capital.

The execution of Novo Nordisk’s 2017 share repurchase programme of up to DKK 16 billion to be executed during a 12-month period beginning 2 February 2017 continues, and a new share repurchase programme has been initiated in accordance with Article 5 of Regulation No 596/2014 of the European Parliament and Council of 16 April 2014 (MAR). For that purpose, Novo Nordisk has appointed Nordea Danmark, filial af Nordea Bank AB (publ) as lead manager to execute the programme independently and without influence from Novo Nordisk. The purpose of the programme is to reduce the company's share capital and to meet obligations arising from share-based incentive programmes.

Under the agreement, Nordea Danmark, filial af Nordea Bank AB (publ) will repurchase shares on behalf of Novo Nordisk for an amount of DKK 3.9 billion during the trading period starting today, 9 August and ending on 30 October 2017. A maximum of 462,106 shares can be bought during one single trading day, equal to 20% of the average daily

trading volume of Novo Nordisk B shares on Nasdaq Copenhagen during the month of July 2017, and a maximum of 27,264,254 shares in total can be bought during the trading period. At least once every seven trading days, Novo Nordisk will issue an announcement in respect of the transactions made under the repurchase programme.

LEGAL MATTERS

Novo Nordisk involved in seven class action lawsuits relating to drug prices in the USA Since 12 May 2017, three additional class action lawsuits have been brought against Novo Nordisk, Eli Lilly, and/or certain Pharmacy Benefit Managers (PBMs) on behalf of classes of US purchasers of diabetes products. One of the class action lawsuits was filed as an add-on action in the US District Court for the District of New Jersey, resulting in five pending actions in New Jersey. The remaining two lawsuits are filed in the US District Court for the Central District of California and the US District Court for the Western District of Washington. All pending matters allege that the manufacturers and PBMs colluded to artificially inflate list prices paid by consumers for diabetes products, while offering reduced prices to PBMs through rebates used to secure formulary access. Novo Nordisk does not expect the lawsuits to have a material impact on Novo Nordisk’s financial position, operating profit or cash flow.

FORWARD-LOOKING STATEMENTS

Novo Nordisk’s reports filed with or furnished to the US Securities and Exchange Commission (SEC), including this document as well as the company’s Annual Report 2016 and Form 20-F, both filed with the SEC in February 2017, and written information released, or oral statements made, to the public in the future by or on behalf of Novo Nordisk, may contain forward-looking statements. Words such as ‘believe’, ‘expect’, ‘may’, ‘will’, ‘plan’, ‘strategy’, ‘prospect’, ‘foresee’, ‘estimate’, ‘project’, ‘anticipate’, ‘can’, ‘intend’, ‘target’ and other words and terms of similar meaning in connection with any discussion of future operating or financial performance identify forward-looking statements. Examples of such forward-looking statements include, but are not limited to:

In this document, examples of forward-looking statements can be found under the headings ‘Outlook’, ‘Research and Development update’, Equity’ and ‘Legal matters’.

These statements are based on current plans, estimates and projections. By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific. Novo Nordisk cautions that a number of important factors, including those described in this document, could cause actual results to differ materially from those contemplated in any forward-looking statements.

Factors that may affect future results include, but are not limited to, global as well as local political and economic conditions, including interest rate and currency exchange rate fluctuations, delay or failure of projects related to research and/or development, unplanned loss of patents, interruptions of supplies and production, product recalls, unexpected contract breaches or terminations, government-mandated or market-driven price decreases for Novo Nordisk’s products, introduction of competing products, reliance on information technology, Novo Nordisk’s ability to successfully market current and new products, exposure to product liability and legal proceedings and investigations, changes in governmental laws and related interpretation thereof, including on reimbursement, intellectual property protection and regulatory controls on testing, approval, manufacturing and marketing, perceived or actual failure to adhere to ethical marketing practices, investments in and divestitures of domestic and foreign companies, unexpected growth in costs and expenses, failure to recruit and retain the right employees, and failure to maintain a culture of compliance.

Please also refer to the overview of risk factors in ‘Risk management’ on pp 40-43 of the Annual Report 2016 available on novonordisk.com.

Unless required by law, Novo Nordisk is under no duty and undertakes no obligation to update or revise any forward-looking statement after the distribution of this document, whether as a result of new information, future events or otherwise.

MANAGEMENT STATEMENT

The Board of Directors and Executive Management have reviewed and approved the financial report of Novo Nordisk A/S for the first six months of 2017. The financial report has not been audited or reviewed by the company’s independent auditors.

The financial report for the first six months of 2017 has been prepared in accordance with IAS 34 ‘Interim Financial Reporting’ and accounting policies set out in the Annual Report 2016 of Novo Nordisk, amended with accounting policy regarding associated companies. Furthermore, the financial report for the first six months of 2017 and Management’s Review are prepared in accordance with additional Danish disclosure requirements for interim reports of listed companies.

In our opinion, the accounting policies used are appropriate and the overall presentation of the financial report for the first six months of 2017 is adequate. Furthermore, in our opinion, Management’s Review includes a true and fair account of the development in the operations and financial circumstances, of the results for the period and of the financial position of the Group as well as a description of the most significant risks and elements of uncertainty facing the Group in accordance with Danish disclosure requirements for listed companies.

Besides what has been disclosed in the quarterly financial report, no changes in the Group’s most significant risks and uncertainties have occurred relative to what was disclosed in the consolidated annual report for 2016.