Novo Nordisk Reported to Police by Regulators over Financial Disclosure Delay

Novo Nordisk Reported to Police by Regulators over Financial Disclosure Delay

The group has admitted the delay but challenges the accusations of having violated the law.

COPENHAGEN -- Denmark's Financial Supervisory Authority said on Tuesday it had reported insulin world leader Novo Nordisk (IW 1000/340) to the police for having hidden crucial information from its shareholders for two days.

In February, the Danish pharmaceutical company learnt on a Friday evening that the U.S. Food and Drug Administration had rejected its applications for two new diabetes treatments, but did not share the information until late on Sunday.

A fundamental principle of regulated equity markets is that information likely to have an impact on judgements of a quoted company must be made available and equitably to existing and potential shareholders.

"The Financial Supervisory Authority has registered a complaint against Novo Nordisk for violating its obligation to disclose inside information as soon as possible," the regulator said.

The group has admitted the delay but challenges the accusations of having violated the law.

"Novo Nordisk's view is that even if the disclosure obligation could be said to apply already on the Friday evening, the company was entitled to delay public disclosure until the implications of the decision had been adequately analysed, which they had been on the Sunday," the company said.

Novo Nordisk, the biggest company in the Nordic region by market capitalization, lost 13.22% or 10.7 billion euros (US$14.4 billion) of its market value on Copenhagen's stock market on February 11.

The possible fine the company could face in Denmark should not pose a serious financial problem to the pharmaceutical giant, but the outlook could be darker if its U.S. investors decided to sue Novo Nordisk, whose securities (American depositary receipts) are listed on the New York Stock Exchange.

Copyright Agence France-Presse, 2013

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