NOVO NORDISK A S (Form: 6-K, Received: 02/05/2020 09:03:00)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _________________________ FORM 6-K _________________________ REPORT OF FOREIGN PRIVATE ISSUER Pursuant to rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934 February 5, 2020 _________________________ NOVO NORDISK A/S (Exact name of Registrant as specified in its charter) _________________________ Novo Allé DK-2880 Bagsværd Denmark (Adress of principal executive offices) Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F Form 20-F x Form 40-F o Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes o No x If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g-32(b):82-________

Novo Nordisk Annual Report 2019 ROSHNI Roshni has type 1 diabetes and lives in India

Contents Management review Consolidated statements Introducing Novo Nordisk Consolidated financial statements 01 Letter from the Chair 42 Income statement 02 Letter from the CEO 43 Cash flow statement 04 Novo Nordisk at a glance 44 Balance sheet 06 Performance highlights 45 Equity statement 46 Notes to the consolidated financial statements Our business Consolidated social statement 08 Leading a sustainable business (Supplementary information) 11 Innovative treatments and solutions for unmet needs 14 Pipeline overview 78 Statement of social performance 16 International Operations: Building a sustainable 78 Notes to the consolidated social statement platform for accelerated growth 18 North America Operations: Ready for growth in a challenging business environment Consolidated environmental statement 20 2019 performance and 2020 outlook (Supplementary information) 84 Statement of environmental performance Governance 84 Notes to the consolidated environmental statement 29 Managing risks to protect value 32 Shares and capital structure Additional information 34 Corporate governance 38 Board of Directors 87 Management´s statement and Auditor´s reports 40 Executive management 91 More information 92 Product overview Roshni lives in India, and loves her school. She is 12 years old and wants to become a doctor. Roshni was diagnosed with type 1 diabetes at the age of four. The first few months were tough. It was hard to get the blood sugar levels right. Then she was referred to a hospital and enrolled in Novo Nordisk’s Changing Diabetes in Children programme, which offers free insulin, help on managing diabetes and support for her and her family. The patient portrayed in this Annual Report have participated of her own accord and solely to express her personal opinions on topics referred to, which do not necessarily reflect the views and opinions of Novo Nordisk. Use of her pictures as illustrations is in no way intended to associate them with the promotion of any Novo Nordisk products. All references can be found in 'More information'. The Management review, as defined by the Danish Financial Statements Act, is found on pp 1-40 and pp 88-91. Novo Nordisk Annual Report 2019 This Annual Report is Novo Nordisk’s full statutory Annual Report 2019. Please read further details in 'More information'.

Introducing Novo Nordisk Our business Governance Consolidated statements 1 Letter from the Chair solving this dilemma. And so do the major prevention programmes targeting obesity Making good and diabetes. The decisions taken by companies like ours will help shape the future of societies for progress generations to come, whether that means bending the curve of the global diabetes epidemic or eliminating our environmental footprint, another area of priority for Novo Nordisk. Over the past year, I have visited our offices Novo Nordisk made good progress during 2019. Our teams have in many parts of the world. I have met people on the front line of operations who delivered growth and crucial new product launches. This has have told me how working for a company established a good platform for the next decade and beyond as we committed to improving healthcare and continue to build our pipeline and make progress as a sustainable promoting sustainability motivates them. business. The insights from these meetings, and the discussions I have had with patients and our investors, have brought external per- pleased to say that these changes are now spectives into the boardroom. The lesson bearing fruit, as evidenced by an accelera- I take away is simple: purpose comes first, tion of sales in International Operations, a profit is an outcome. A clear purpose and return to growth in our Biopharm business, ambition to add value to society beyond and a reinvigorated pipeline with great financial results helps attract the top talent, potential to offer treatment for unmet thereby fuelling innovation and making medical needs. Novo Nordisk a more sustainable company. We recognise that relying solely on in-house In the course of 2019, two long-tenured research capabilities will not be enough to colleagues, Jesper Brandgaard, executive sustain success, and we are therefore open- vice president of Biopharm & Global Legal ing our business to strategic partnerships. & Patents, and Lars Green, executive vice Novo Nordisk’s market strength and deep president of Business Services & Compli- expertise in metabolic diseases makes the ance, both left Novo Nordisk to pursue company an attractive partner for innova- their careers elsewhere. I want to thank tive biotech companies. This has allowed them both for the legacy they leave and us to build partnerships to bring on-board commend them for their dedication and promising new technologies. leadership and for the achievements they made on behalf of Novo Nordisk. As a large company, Novo Nordisk also has large responsibilities. Society is New members were brought on board Our strategy is working. Although expecting more from business to help solve from outside of Novo Nordisk. Ludovic the challenges facing Novo Nordisk are challenges such as bending the curve on Helfgott joined in April 2019 as executive not going away – indeed, many problems diabetes, climate change and environmen- vice president and head of Biopharm. such as intensified competition, healthcare tal degradation. I believe Novo Nordisk, Monique Carter, who joined Novo Nordisk affordability and the need to bolster R&D with its purpose and commitment to in November 2018, was promoted in are more urgent than ever – we have put pursuing a more sustainable development, August 2019 to executive vice president of in place the building-blocks for responding is well placed to rise to the challenge. People & Organisation. to these and other challenges. The Board of Directors is confident that Novo Nordisk The pharmaceutical industry faces an On behalf of the Board, I would like to is well positioned to deliver on its purpose important societal challenge: how can offer my thanks to all Novo Nordisk’s of defeating diabetes and other serious we continue to innovate and improve employees for their hard work and commit chronic diseases and, by doing so, achieve health outcomes while at the same time ment during 2019; to Lars Fruergaard profitable growth. ensuring that as many people as possible Jørgensen and his team for their inspiring have access to our products at an afford- leadership and to our shareholders for their Last year, we laid out our plans to repriori able price? This issue has been discussed continued support. • tise resources towards key growth areas, at every board meeting I have chaired. I streamline operations and redefine our believe our initiatives for enhancing access Helge Lund Novo Nordisk Annual Report 2019 research and development strategy. I am to care represent real progress towards re- Chair of the Board of Directors

Introducing Novo Nordisk Our business Governance Consolidated statements 2 Letter from the CEO we manage the business. These aspirations replace our long-term financial targets. We hold ourselves accountable for progress Setting new towards each and all of them, and in the following pages we elaborate on the new strategic aspirations. Our key contribution is to discover and de- velop innovative biological medicines and aspirations make them accessible to patients all over the world. Today, we have best-in-class products in all the therapy areas in which we are active, and at the end of 2019 our sales and marketing teams have delivered no fewer than 87 successful launches, Our purpose is to drive change to defeat diabetes and other serious delivering innovative treatments to people living with diabetes, obesity, haemophilia chronic diseases. That is a long-term commitment, and we are and growth hormone disorders. We pursuing it relentlessly. We build on our innovation expertise and are accelerating growth in International our therapy focus combined with commercial excellence to provide Operations where we now aspire to grow benefits to the millions of patients who rely on our products. When annual sales by 6-10% until 2025 from a historical level of 5-6%. Meanwhile, we we do that well, we will be a sustainable business that adds value are transforming our US business, and it to society and delivers profitable growth. is our ambition that by 2022 around 70% of our sales will come from new products. It is also encouraging to note that our Biopharm business has proven robust in the face of disruptive competition and has grown in both the haemophilia and growth hormone disorder product segments. One of the greatest opportunities for Novo Nordisk is undoubtedly obesity care, where there are huge unmet needs. We have already established a leading position in this field and expect to build on the success of Saxenda®, which is now available in 46 countries. In 2020 we will see the results of our pivotal clinical programme, STEP, which evaluates the benefits of injectable semaglutide for the treatment of obesity. Our contribution to global health relies on our ability to develop radically new treatments and solutions and we are well positioned to do this. We have raised the As we enter a new decade, Novo was approved in the US for cardiovascular innovation-bar and are bolstering our Nordisk stands strong. We delivered a very risk reduction in people with type 2 pipeline, making significant advances in solid financial result for 2019 reflecting diabetes and established cardiovascular R&D productivity by harnessing digital tech- an accelerated growth in International disease. Ozempic® is now available in 26 nologies to accelerate development of new Operations and the contribution from the countries and achieved blockbuster status product candidates. We believe we have launch of Ozempic® particularly in North within 18 months. what it takes to potentially even disrupt America Operations. how diabetes is treated. To complement We have introduced strategic aspirations our in-house capabilities to develop novel Three milestones stand out: in the US, we in four categories with medium-term therapies we partner with leading biotech secured a major scientific achievement goals to provide direction towards 2025: companies like bluebird bio and Dicerna. with the regulatory approval of Rybelsus®, purpose and sustainability; innovation and the world’s first and only GLP-1 medicine therapeutic focus; commercial execution; All of these accomplishments demonstrate in a tablet, and early feedback indicates and financials. I invite you to also look how we are indeed driving change to promising prospects. In January 2020, at our company’s performance from this benefit patients and delivering convincing ® Novo Nordisk Annual Report 2019 Ozempic , a once-weekly injectable GLP-1, holistic perspective, because that is how results. Results that are

Introducing Novo Nordisk Our business Governance Consolidated statements 3 reflected in strong financial performance through education and on-the-ground be successful we must set ambitious goals, and achievement of our long-term financial interventions. Our Cities Changing and we must work in a simple and agile targets. Diabetes programme now involves 25 way and nurture an inclusive workplace cities. In 2019, we entered a partnership that enables everyone to realise their But in a world where serious chronic with UNICEF to develop interventions that potential. diseases not only have a significant impact can help prevent childhood overweight and on individuals’ quality of life, but also ham- obesity worldwide, with an initial focus We aim to be a truly sustainable business per socio-economic development and put a on Latin America and the Caribbean. And – environmentally, socially and financially. strain on healthcare budgets, it takes more through our partnership with the Interna- From the very beginning, this is how we than medicines. We consider it our respon- tional Red Cross, we are providing essential have built our business, sticking with the sibility to help tackle these challenges. That insulin to thousands of people who are Novo Nordisk Way. I am confident that we is what we mean by driving change. affected by humanitarian crises. have a solid formula for delivering on our purpose, contributing to global sustainable We are stepping up our efforts to ensure During 2019, we launched an ambitious development and sustaining commercial broader access to our medicines for those new environmental strategy, Circular success. Let me close by thanking everyone who need them, regardless of their circum- for Zero, which will take us towards our at Novo Nordisk for all their great work and stances. Ensuring affordability of medicines ultimate ambition, namely to ensure zero their commitment to our shared purpose. is a high priority for us, and we have environmental impact from our activities. A special thanks to our Board of Directors expanded our affordable insulin offerings in As of this year, our entire global production for their decisive stewardship, constructive the US, where our offerings provide a solid sources renewable power and the next challenges and unwavering confidence. I safety net for uninsured patients, and in major milestone in sight is to eliminate CO2 also want to thank our shareholders and all low- and middle-income countries, where entirely from all operations and transport our other stakeholders for their continued healthcare systems are inadequate. by 2030. support. • We are working with partners across With the Novo Nordisk Way as our guide, Lars Fruergaard Jørgensen the globe to advance disease prevention we will continue to evolve our culture. To President & chief executive officer �trategic aspirations �or 202� �urpose and Innovation and �o��ercial �inancials sustaina�ilit� t�erapeutic �ocus e�ecution • Being respected for • Further raise the • Strengthen Diabetes care • Deliver solid sales and adding value to society innovation-bar for leadership – aim at a operating proﬁt growth diabetes treatment global value market – Deliver 6–10% sales • Progress towards zero share of more than 1/3 growth in International environmental impact • Develop a leading Operations portfolio of superior • Strengthen Obesity care – Transform 70% of sales • Ensure distinct core treatment solutions for leadership and double in the USA2 capabilities and evolve obesity current sales¹ culture • Drive operational • Strengthen and progress • Secure a sustained efﬁciencies across the the Biopharm pipeline growth outlook for value chain to enable Biopharm investments in future • Establish presence in growth assets Other serious chronic diseases focusing on • Deliver free cash ﬂow to cardiovascular disease, enable attractive capital non-alcoholic steato- allocation to shareholders hepatitis and chronic kidney disease Novo Nordisk Annual Report 2019 1� Based on 2019 sales 2� From 2015 to 2022

Introducing Novo Nordisk Our business Governance Consolidated statements 4 Novo Nordisk at a glance Novo Nordisk is a global health- care company, headquartered 463 650 in Denmark. Our key contribu- 1 2 million people live with diabetes million people live with obesity tion is to discover and develop innovative biological medicines and make them accessible to patients throughout the world. We aim to lead in all disease 1.1 1.8-2.9 million people live with in every 10,000 children is born with areas in which we are active. Haemophilia3 growth hormone defi ciency4 43,258 employees 80 countries with 169 countries with 3 continents with research world wide affi liates or offi ces marketed products and development facilities Our corporate strategy Diabetes care Obesity care Strengthen leadership Strengthen treatment by offering innovative options through market medicines and driving Nordisk ovo Wa development and by patient outcomes N y offering innovative medicines and Driving driving patient change to outcomes defeat diabetes and other serious chronic diseases S Other serious u ss Biopharm sta ne chronic diseases inable busi Secure a leading position by Establish presence by leveraging full portfolio and building competitive pipeline expanding into adjacent areas and scientifi c leadership Novo Nordisk Annual Report 2019

Introducing Novo Nordisk Our business Governance Consolidated statements 5 Adding value Financially to society responsible Socially Environmentally responsible responsible The company’s Articles of Association spell out the obligation to do business in a financially, environmentally and socially responsible way. This approach is applied to ensure that business decisions are better informed, always keeping in mind the best interests of the patients we serve and with an aim to create value for all stakeholders. Our business model Our key contribution is to discover and develop innovative biological medicines and make them accessible to patients throughout the world. We rely on external fi nancial, environmental and social resources and leverage our core capa- Expertise bilities to create value for patients, employees, from academic Insights partners and shareholders. institutions from Raw healthcare Resources materials, experts and water and patients energy Manufactured goods Financial resources Deep disease Diverse understanding talent Effi cient large-scale production of proteins Engineering, formulating, developing and delivering protein-based treatments DKK 34,743 million to DKK 27,527 Global commercial reach shareholders million and leader in chronic as dividends and share total tax disease care repurchases contribution 30 million people using Value created Novo Nordisk Approx. 5,000 Diabetes care investigator sites products active in Novo Nordisk-sponsored Core capabilities clinical trials Financially responsible Environmentally responsible More than 43,258 Socially responsible Novo Nordisk Annual Report 2019 1 billion insulin employees of p e n fi l ls which 5,507 produced new hires

Introducing Novo Nordisk Our business Governance Consolidated statements 6 Performance highlights DKK million 2015 2016 2017 2018 2019 2018–2019 Financial performance Change Net sales 107,927 111,780 111,696 111,831 122,021 9% Sales growth in constant exchange rates1 8.4% 5.5% 2.3% 4.6% 5.6% Net sales growth as reported 21.5% 3.6% (0.1%) 0.1% 9.1% Operating profit 49,444 48,432 48,967 47,248 52,483 11% Net financials (5,961) (634) (287) 367 (3,930) Profit before income taxes 43,483 47,798 48,680 47,615 48,553 2% Net profit for the year 34,860 37,925 38,130 38,628 38,951 1% Total assets 91,799 97,539 102,355 110,769 125,612 13% Equity 46,969 45,269 49,815 51,839 57,593 11% Purchase of property, plant and equipment1 5,224 7,068 7,626 9,636 8,932 (7%) Free cash flow1 34,222 39,991 32,588 32,536 34,451 6% Financial ratios1 Percentage of sales: Gross margin 85.0% 84.6% 84.2% 84.2% 83.5% Operating margin 45.8% 43.3% 43.8% 42.2% 43.0% Net profit margin 32.3% 33.9% 34.1% 34.5% 31.9% Sales and distribution costs 26.2% 25.4% 25.4% 26.3% 26.1% Research and development costs 12.6% 13.0% 12.5% 13.2% 11.7% Administrative costs 3.6% 3.5% 3.4% 3.5% 3.3% Equity ratio 51.2% 46.4% 48.7% 46.8% 45.8% Return on equity 79.9% 82.2% 80.2% 76.0% 71.2% Cash to earnings 98.2% 105.4% 85.5% 84.2% 88.4% Payout ratio 46.6% 50.2% 50.4% 50.6% 50.5% Long-term financial targets1 Target Operating profit growth 43.3% (2.0%) 1.1% (3.5%) 11.1% 5% Operating profit growth adjusted2 35.2% 3.9% 1.1% (3.5%) 11.1% Operating profit growth in constant exchange rates adjusted2 12.7% 6.2% 4.8% 2.8% 5.6% Operating profit after tax to net operating assets 148.7% 150.2% 143.2% 116.7% 98.0% 80% Cash to earnings (three-year average) 96.8% 102.4% 96.4% 91.7% 86.0% 85% The Group has applied IFRS 16 'Leases' for the first time on 1 January 2019. Amounts for 2015-2018 have not been restated. Please refer to note 1.2. 1. See ’Financial definitions’. 2. Years 2015 and 2016, adjusted for DKK 2,376 million from the partial divestment of associated company and DKK 449 million from the income related to the out-licensing of assets for inflammatory disorders respectively. �ales �� t�erapeutic area �ales �� geograp�ic area �atients reac�ed �it� dia�etes care products Diabetes care Obesity care Region Europe Region AAMEO �esti�ate� Haemophilia Growth disorders Region China Region Japan & Korea Ceiling price* Regular pricing Other Biopharm Region Latin America North America Operations Million 6% 1% 30 8% 19% 25 5% 50% 20 15 2019 11% 2019 10 5 11% 0 80% 2015 2016 2017 2018 2019 5% * Patients reached with insulin below ceiling price 4% of USD 4.00/vial of human insulin. Novo Nordisk Annual Report 2019

Introducing Novo Nordisk Our business Governance Consolidated statements 7 Performance highlights 2015 2016 2017 2018 2019 2018–2019 Social performance Change Patients reached with Novo Nordisk's diabetes care products (estimate in millions) 26.8 28.0 27.7 29.2 30.0 3% Patients reached with Novo Nordisk's diabetes care products via the Access to Insulin Commitment (estimate in millions) — — 0.3 0.3 2.9 3 — Employees (total) 41,122 42,446 42,682 43,202 43,258 0% Employee turnover 9.2% 9.7% 11.0% 11.7% 11.4% Gender in management (ratio men:women) 59:41 59:41 60:40 60:40 60:40 Relevant employees trained in business ethics 98% 99% 99% 99% 99% Product recalls 2 6 6 3 4 33% Failed inspections 0 0 0 0 0 Long-term social targets Target Employee engagement — — 90% 91% 91% ≥ 90 Company trust (scale 0–100) — — 82.2 84.5 78.2 ≥ 80 Environmental performance Change Water consumption for production sites (1,000 m3) 3,131 3,293 3,276 3,101 3,149 2% Waste from production sites (1,000 tons) 159 153 157 142 124 (13%) Long-term environmental targets Target Share of renewable power for production sites 78% 78% 79% 77% 76% 100% by 2020 CO2 emissions from operations and transportation (1,000 tons) — — — 278 306 0 by 2030 Share performance Change Basic earnings per share/ADR in DKK1 13.56 14.99 15.42 15.96 16.41 3% Diluted earnings per share/ADR in DKK1 13.52 14.96 15.39 15.93 16.38 3% Total number of shares (million), 31 December 2,600 2,550 2,500 2,450 2,400 (2%) Dividend per share in DKK 6.40 7.60 7.85 8.15 8.35 4 2% Total dividend (DKK million) 16,230 19,048 19,206 19,547 19,651 4 1% Share repurchases (DKK million) 17,229 15,057 16,845 15,567 15,334 (1%) Closing share price (DKK) 399.90 254.70 334.50 297.90 386.65 30% 1. See ’Financial definitions’.3. Scope of Access to Insulin Commitment expanded in 2019 to also include middle-income countries and selected organisations providing humanitarian relief. 4. Total dividend for the year including interim dividend of DKK 3.00 per share, which was paid in August 2019. The remaining DKK 5.35 per share, corresponding to DKK 12.551 million, will be paid subject to approval at the Annual General Meeting. ��plo�ees �total� �ater consu�ption ��2 e�issions �ro� operations and Region Europe Region AAMEO Locations with high water stress or large transportation Region China Region Japan & Korea seasonal variations* Other locations Company cars Business ﬂights Region Latin America Product distribution North America Operations Ofﬁce buildings and laboratories Production Thousand 14% 20% 50 29% 40 30 2019 2019 20 21% 4% 10 86% 0 2015 2016 2017 2018 2019 26% Novo Nordisk Annual Report 2019 * As deﬁned by the World Resource Institute

Introducing Novo Nordisk Our business Governance Consolidated statements 8 Purpose and sustainability: �trategic aspirations �or 202� �urpose and Leading a sustaina�ilit� • Being respected for adding value to society sustainable • Progress towards zero environmental impact • Ensure distinct core capabilities business and evolve culture In 2019, we entered a partnership with UNICEF to develop interventions that can help prevent childhood overweight and obesity worldwide, with an initial focus on Latin America and the Caribbean. Through Our business is built on a commitment to drive change to defeat this partnership we will combine efforts to diabetes and other serious chronic diseases. We do so by pioneer- enhance knowledge and awareness and ing scientific breakthroughs and expanding access to our medi- address root causes. The aim is three-fold. cines. But we do not stop at that. We are also working to prevent, We want to enhance knowledge among decision-makers on successful policies to and ultimately cure, these diseases. We have a legacy in diabetes prevent childhood overweight and obesity of almost a century, and over the years we have expanded into in middle-income countries. We will build other serious chronic diseases. awareness of the impact of overweight and obesity on children and their rights and advocate for the need to make systemic changes to address this growing epidemic. There will not be resources to provide Preventing the rise in diabetes and And finally, we will drive and strengthen for adequate chronic care for all who obesity multi-sector interventions. need it. In the public debate strong voices In a world strained by the impact of dia- are questioning our business model and betes, we have a responsibility to respond With the right medical treatment and care, current practices for intellectual property to the societal challenge. The burden of people with serious chronic diseases can rights, putting pressure on the price of es- diabetes, fuelled by increasing rates of live a life free of complications and be fully sential medicines, and expecting us to take overweight and obesity, is rising in every productive citizens. But as long as there is a more responsibility for solving the problems part of the world despite long-running, col- significant gap between those who achieve caused by the pandemic growth of chronic lective efforts to fight the pandemic and its good health and those who do not, the sit- diseases as well as other global issues. We devastating impact on people and societies. uation is unsustainable and will impact our want to be part of the solution, and we are To defeat diabetes, we need a new level of ability to be successful for the long-term. stepping up to that challenge. commitment. Prevention of diabetes and obesity is systematically underfunded and We are stepping up our efforts to provide We envisage a future in which markets and there are few, if any effective models that broader access to our medicines for those governments will punish companies that adequately address inequality in health. We who need them. We will actively be part are seen to cause harm to people, com- want to find, pilot and scale effective ways of ensuring that more people are given munities or the environment through their to prevent people at risk from developing access to diagnosis and that Novo Nordisk products or operations, and reward those diabetes and obesity. medicines are available and affordable, that account transparently for their impacts and we will continue to develop new and and benefit society. Our aspiration is to be In support of the Sustainable Development innovative treatments to further improve respected for adding value to society. Goals, we are working with partners across health outcomes for patients. Meanwhile, the globe to advance disease prevention we will also support prevention by building We take leadership in the concerted efforts through education and on-the-ground in- capacity in health systems and societies. to achieve good health and well being terventions. Our Cities Changing Diabetes When we succeed at all this, it will ulti- for all. We have also committed to take programme has become a social movement mately lead to better health and thereby action in the face of climate change, with a in its own right, mobilising multiple stake- help contain the vast societal and financial bold ambition to leave zero environmental holders in the effort to tackle the growing burden arising from chronic diseases. footprint from our business activities. Our issues of urban diabetes and build healthier strategy is informed by the global goals environments. By now we have 25 partner Access to affordable care for for sustainable development towards 2030 cities. vulnerable populations set by world leaders in 2015. We can help Novo Nordisk operates in 169 countries Novo Nordisk Annual Report 2019 deliver on these goals. with vastly different levels of income and

Introducing Novo Nordisk Our business Governance Consolidated statements 9 health systems. As a global healthcare are continuing to launch initiatives to help • Circular supply: we will collaborate company, we know that different ap- more people with diabetes access afford- proactively with suppliers to embed proaches are needed to ensure that the able medicine – including those with insur- circular thinking for reduced environ- most vulnerable people receive the care ance and those without – as we continue mental impact across our value chain they need. For this reason, Novo Nordisk to support a longer-term, systemic reform. and switch towards circular sourcing and has put in place a number of initiatives procurement. aimed at ensuring that vulnerable groups New insulin affordability offers, effective as • Circular company: we aim to eliminate have access to affordable medicines and of January 2020, include: environmental footprint from Novo care, including: • A Cash Card Program, offering that for Nordisk operations and drive a circular USD 99, people with diabetes can get up transition across the company aspiring • Through our Access to Insulin Commit- to three vials or two packs of FlexPen®/ for zero environmental impact. ment we have set a ceiling price of USD 4 FlexTouch®/PenFill® pens of any combi- • Circular products: we will upgrade for a 10 ml vial of Human Insulin offered nation of Novo Nordisk Inc. insulins. existing and design new products based to governments in low- and middle- • NovoLog® and NovoLog® Mix follow-on on circular principles and solve the end- income countries and to humanitarian brands are made available in vials and of-life product waste challenge to close organisations. pens at a 50 percent list price reduc- the resource loop. • Through the Changing Diabetes® in tion from the newly established Novo Children programme we provide insulin Nordisk Pharma Inc. Sustainable business approach free of charge to children with type • An immediate, one-time insulin supply As a business with global reach, we are 1 diabetes and build capacity in the option available for people facing an defining our role in contributing to an world’s poorest countries. In 2019, we acute need when more time is needed environment, society and economy that enrolled 2,819 additional children. In to- to identify a sustainable solution. enables all people, and our business, to tal 15,121 health care professionals have thrive. Our ambition is to be a sustainable been trained, 208 clinics established and These new options build upon our existing business that adds value to society. By that 25,695 children across 14 countries have offers: we mean staying in business – because received care as part of the programme • The Patient Assistance Program, which millions of people rely on us – and con- since 2009. we have offered since 2003. This pro- tributing to the achievement of global • We work to strengthen capacity to vides free medicines, including all Novo sustainable development. diagnose and treat people affected by Nordisk insulin medications, to eligible humanitarian crises through Partnering patients. Families of four with an annual In our approach, we adhere to interna- for Change with the International Com- income up to USD 103,000 can get tional standards, including the UN Guiding mittee of the Red Cross and the Danish free medications through our Patient Principles on Business and Human Rights, Red Cross. Assistance Program (USD 49,960 for voluntary commitments such as the UN • Through the World Diabetes Founda- individuals). Global Compact Ten Principles and the tion, we support large-scale diabetes • We have made Novo Nordisk human recommendations of the Task Force on capacity building in low-resource insulin available at Walmart for about Climate-related Financial Disclosures. We settings and through the Defeat NCD USD 25/vial for the past 15 years, and also diligently adhere to compliance re- partnership we support a new multi- recently expanded it to other national quirements such as the US Foreign Corrupt sector effort to improve global access to pharmacy chains. Practices Act, the UK Bribery Act and the care for non-communicable diseases. • Our Co-pay Savings Cards help spread UK Modern Slavery Act. the costs of commercially insured pa- In September 2019, the United Nations tients with high out-of-pocket costs. And throughout, we seek to integrate adopted the Political Declaration on Uni- sustainability in all our operations. For versal Health Coverage in support of the Pursuing zero environmental impact example, environmental considerations are Sustainable Development Goals. In Novo Our long-standing climate action efforts included in the project manual for develop- Nordisk we welcome this effort to find sus- are paying off. We expect to meet our ment of new products, ensuring that deci- tainable solutions and we will continue to target of using only renewable power in sions are informed by life cycle assessments expand our own efforts to provide access our production by 2020. The final stretch of environmental impacts. to our products and strengthen capacity was the result of a new investment in a 2.7 to diagnose and treat diabetes throughout square kilometre solar panel installation So how will we know when we are doing the world. in North Carolina, USA, which will make enough – throughout our value chain? We power supplies for our entire US produc- are changing the way we manage, track Affordable insulin in the US tion carbon-free from early 2020. and report on progress to be a sustainable Ensuring affordability of medicines within business. Taking our point of departure in the complex US healthcare system contin- Our next ambitious target is to achieve what science and international standards ues to be a high priority. This year, we met zero CO2 emissions from all operations and have defined to be necessary in a global face-to-face with some of our most vocal transport by 2030. This target is part of our context, we follow a robust approach to critics in the insulin pricing debate – includ- ‘Circular for Zero’ environmental strategy, identify current state and required actions ing patients and physicians – to improve which ultimately aims for zero environmen- through a focused, long-term effort. our understanding of the affordability tal impact from our business. We focus on Novo Nordisk Annual Report 2019 challenges that patients are facing. And we three key areas:

Introducing Novo Nordisk Our business Governance Consolidated statements 10 assurance, in adherence with international Our four Transformational Research Units, standards. which pursue novel treatment forms and platform technologies, illustrate this type Evolving our culture of cultural evolution. These biotech-like Novo Nordisk core capabilities provide a units, based in Denmark, the USA and the competitive advantage. Building on a deep UK, operate as satellites to Novo Nordisk’s disease understanding, we are a leader central R&D function and drive innovation in chronic disease care. We have deep in prioritised fields such as translational expertise in engineering, formulating, cardio-metabolic research and stem cell Guided by the Novo Nordisk Way developing and delivering protein-based research. Working in a highly agile manner, We build our business on a principled treatments. And we have the capacity for outside of the usual governance structures, approach to always doing business in a efficient large-scale production. they are largely free of most corporate financially, environmentally and socially formalities and control – so they can dis- responsible way, which is firmly anchored To meet the needs of the patients we serve, cover, enable and accelerate concepts and in the Articles of Association. This commit- we are continuously challenging ourselves projects that will expand and diversify our ment is reflected in the Novo Nordisk Way, to raise the innovation-bar while pursuing pipeline with disruptive medicines. • and guides how we lead a sustainable busi- aspirational goals. That, in turn, demands ness. When we make decisions, we always that we change how we work – that we keep in mind what is best in the long term evolve our culture – to think bigger, strive for the patients we serve, our employees, for simplicity and be more agile in order Novo Nordisk�s ��ssentials� the communities in which we are present to quickly adapt to a constantly-changing and the global society we are part of. This business environment. 1 We create value by having a patient centred business way we seek to attend to the interests approach. of stakeholders as well as the long-term With bold ideas, the risk of failure will interests of our shareholders. The goal is to increase. We have to accept failure, and 2 We set ambitious goals and avoid any negative impacts, and maximise learn fast from them. We find inspiration strive for excellence. the positive impacts we can make through from the agility and entrepreneurial mind- our business activities. set in biotech start-ups. One example is the 3 We are accountable for our Novo Nordisk Research Centre in Seattle, ﬁnancial, environmental and We use a unique and systematic approach USA, where we work with cutting-edge social performance. called facilitation to make sure everyone technologies in life sciences. It was initially 4 We provide innovation to the lives up to the Novo Nordisk Way. It set up in 2009 to focus on our now discon- beneﬁt of our stakeholders. comprehensively assesses how managers tinued research in autoimmune diseases. and employees demonstrate our desired Since then, the site has transitioned into 5 We build and maintain good behaviours, our ten ‘Essentials‘. These type 1 diabetes, obesity, immunology, relations with our key assessments are conducted by experienced kidney disease, device research and protein stakeholders. in-house experts with a broad knowledge and peptide engineering. Here, a diverse of the business. Any issues are addressed group of 120 employees are encouraged 6 We treat everyone with respect. locally, and consolidated insights are shared to work together across functions and in 7 We focus on personal perfor- with Executive Management and the Board close collaboration with the global R&D mance and development. of Directors. organisations across Novo Nordisk and 40 strategic partners. 8 We have a healthy and The Novo Nordisk Way also underpins our engaging working environment. performance management and incentive The landmark development of Rybelsus®, schemes. All employees are appraised the first ever oral GLP-1 product, is a 9 We strive for agility and against criteria for goal achievement as stellar example of simplicity and agility. The simplicity in everything we do. well as the extent to which their behaviours submission for marketing approval of Ry- 10 We never compromise on ® model the Novo Nordisk Way, as spelled belsus embodies the FAST concept, intro- quality and business ethics. out in the Essentials. duced in 2019 across R&D: Flexible, Agile, Simple and Transformational. The team We have global codes of conduct and ensured parallel rather than sequential pro- standards to ensure that we conduct our cesses without compromising on quality, business ethically and responsibly: to pre- following a clinical development program vent corruption, meet our responsibility to involving more than 9,500 patients, 10 respect human rights, safeguard health and phase 3a studies, and more than 20 clinical fair employment terms for our employees pharmacology studies. As a result, timelines as well as those of our suppliers, effective- were reduced to way below industry stan- ly manage and mitigate impacts on the dards, achieving approval within six months environment and respect the integrity of and bringing Rybelsus® faster to the market our business partners. These practices are to the benefit of patients. Novo Nordisk Annual Report 2019 put into action via robust governance and

Introducing Novo Nordisk Our business Governance Consolidated statements 11 Innovation and therapeutic focus: �trate�i� aspirations �or 202� �nnovation and Innovative t�erapeuti� �o�us • Further raise the innovation-bar for diabetes treatment treatments and • Develop a leading portfolio of superior treatment solutions for obesity solutions to unmet • Strengthen and progress the Biopharm pipeline needs • Establish presence in Other serious chronic diseases focusing on cardiovascular disease, non-alcoholic steatohepatitis and chronic kidney disease �ia�etes is asso�iated �it� In the pursuit of our purpose, we pioneer scientific breakthroughs, s�orter li�e e�pe�tan�� and lo�er �ualit� o� li�e expand access to our medicines, and work to prevent and ultimately cure the diseases we are experts in. �ia�etes �i�e e�pe�tan�� 8 years shorter7 Chronic diseases affect hundreds income countries.6 Less than half of them Driven by 200� increased risk of of millions of people and are among the are treated, and even then, only a fraction all��ause �ortalit�12 most urgent global health challenges. Left of them live a life free of diabetes-related untreated, they can lead to life-threatening complications. As a consequence, people complications, and the burden they place with diabetes have a higher risk of dying �� on individuals, families and society is grow- prematurely, with an average reduction �0� of people with diabetes die 7 ing in every part of the world. We will take in life expectancy of eight years. People from at�eros�leroti� ��9 part in ensuring that more people have ac- with diabetes have a 150% increase in risk cess to diagnosis and affordable treatment of stroke8 and as many as 70% of people 1�0� increase in risk of stroke8 options where they do not currently exist, with diabetes die from atherosclerotic and we continue to drive innovation in our cardiovascular diseases.9 Without concert- labs that can improve life for people living ed action, it is estimated that 700 million �r�ans with a serious chronic disease. people will have diabetes by 204510 with Higher likelihood of neuropathy, associated societal costs exceeding USD 1 retinopathy, limb amputation, 11 Our innovation and therapeutic focus is trillion per year globally. cancer and cognitive dysfunction leveraged by our commercial excellence. We draw upon insights from patients We will remain the global leader for diabe- and partners to transform bold ideas into tes care and offer patient support solutions life-saving and preventive medicines. We in addition to therapeutic treatment. Novo �urt�er raise t�e innovation �ar �or dia�etes treat�ent make long-term investments in novel treat- Nordisk currently holds a global diabetes ments and technologies, including curative market share of 29% and is growing this �nsulin ��1 stem cell-based therapies, and we contin- share, with a medium-term goal of at least Curative ually advance the development of medical one third of the market. We want to en- treatment devices and digital health solutions. able people with diabetes to lead healthy Oral GLP-1 Innovation level analogue lives, and we have product offerings for Glucose-sensitive Insulin Strengthen leadership in Diabetes care all types of treatment needs (see 'Product Weekly GLP-1 analogue There is a need for new and improved overview'). Over the next decade, we will Once-weekly treatments that can provide better health further raise the innovation-bar for diabe- GLP-1 Long-acting outcomes for people with diabetes. tes treatment, with the goal of normalising analogue According to the International Diabetes life with diabetes. Insulin Native GLP-1 Federation 463 million people worldwide analogue are now estimated to have diabetes5, and More than half of our total sales in the Novo Nordisk Annual Report 2019 eight out of ten live in low- and middle- diabetes care segment, insulin is still time

Introducing Novo Nordisk Our business Governance Consolidated statements 12 important to Novo Nordisk, and it remains obesity medication. We aim to develop a the only treatment for type 1 diabetes. We leading portfolio of treatment solutions. ��e �lo�al are relentlessly pursuing a cure for type �urden o� o�esit� 1 diabetes, and at the same time we are We are committed to expanding access working to develop stem cell therapy that to obesity care and helping patients lead ��0 �illion adults have obesity13 could be transformational. healthy lives. The first step is to change how the world sees people with obesity 120 �illion We will strengthen our leading position and make obesity a healthcare priority. We children have obesity15 within insulin and gain market share with are determined to combat the stigma and our current portfolio of next-generation biases associated with obesity. We fight for �� illion insulin products. Meanwhile, in our inno- better recognition of obesity as a treatable deaths were caused by obesity in 201017 vation pipeline we continue to focus on disease, taking a holistic approach. We delivering improved glucose control, but aim to help a wider number of people, by 2 trillion we also target diabetes-related complica- partnering with professional associations US dollars in annual global tions. We are researching glucose sensitive and other stakeholders. In this effort, we cost of obesity16 insulins and cardio-protective insulins. need to engage with payers and educate healthcare professionals, encourage people With our two recent GLP-1 products, with obesity to seek treatment, and de- Ozempic® and Rybelsus®, we want to velop educational programmes and open redefine type 2 diabetes treatment. Our research initiatives. �evelop a leadin� port�olio o� superior intention is to position Rybelsus® as the treat�ent solutions �or o�esit� preferred tablet, and Ozempic® as the pre- We support this development with preven- ferred injectable GLP-1 for the treatment of tive interventions, commercial execution % type 2 diabetes. and pipeline research progress – developing �aun��ed 5 Today´s a leading portfolio of superior treatment Saxenda® available medication We are at the forefront of innovation in the solutions and securing broad availability of 10 GLP-1 class and orally administered delivery treatments for people with obesity. Sax- ��ase � Semaglutide devices and are pursuing several therapeu- enda®, currently available in 46 countries, Obesity tic opportunities with semaglutide. addresses a global unmet need for medical 15 ��ase 2 weight management. Over the next few AM833 Treatment 20 gap Our digital health initiatives, which include years, we will make Saxenda® available to ��ase 1 PYY 1875 connected devices and digital solutions, more people in more countries. Tri-agonist also aim to improve health outcomes for GG-co-agonist 25 LA-GDF15 patients. Not only will these tools aim to We are working to develop new anti-obe- AM833+Sema 30 Bariatric make it easier for patients to manage their sity medications based on semaglutide. surgery treatment and bring them in better control; We are awaiting the results of our pivotal Weight loss over time this will potentially allow for data capture phase 3a clinical development programme, that can document adherence patterns as STEP, which investigates injectable well as short and long-term benefits of our semaglutide for the treatment of obesity. treatments. Meanwhile, we are gathering evidence �tren�t�en and pro�ress t�e �iop�ar� on how obesity management can lead to pipeline Strengthen treatment options in sustainable and relevant health, economic Obesity care and societal outcomes. Around 650 million adults live with obesi- �urative ty13 and this number is expected to grow Secure a leading position in Biopharm t�erap� to more than one billion by 2025.14 In ad- Our Biopharm business is a strong speciality 15 Non-invasive dition, 120 million children have obesity. care unit that encompasses rare blood and therapy People with obesity are at an increased risk rare endocrine disorders, both areas of Mim8 of developing several comorbidities that are significant unmet medical need. Concizumab life-threatening and costly for society. From Innovation in haemophilia Esperoct® a socioeconomic perspective, obesity is one While Biopharm’s performance has been of the biggest disease burdens, with its resilient and robust the future is not Reﬁxia® global economic impact estimated at USD straightforward, due to intense competi- NovoEight® 16 2 trillion annually. tion and slower growth in the haemophilia NovoThirteen® and growth hormone markets. Therefore, NovoSeven® Still, obesity is not widely recognised as a we are expanding our focus to shape 1986 today future disease that may require medical treat- Biopharm for leadership in rare blood ment. Today, around 15 million people use disorders and rare endocrine disorders. anti-obesity medication.18 Few medications exist, leaving a significant opportunity for In the near term the way we will be suc- Novo Nordisk Annual Report 2019 Novo Nordisk as a market leader for anti- cessful is by working towards

Introducing Novo Nordisk Our business Governance Consolidated statements 13 developing and delivering faster and more daily to a weekly injection has the poten- �sta�lis� presen�e in �t�er serious ��roni� front-loaded launches, in more markets. tial to significantly relieve the treatment diseases Additionally, we will strengthen our Bio- burden for people with growth hormone pharm platform by reinvigorating our R&D deficiencies and may increase adherence efforts and utilising the full range of the and efficacy. technology platforms at our disposal, as �� well as pursuing external opportunties. Establish presence in other serious chronic diseases Within rare blood disorders, we are Finally, we are working to establish our well-positioned with a broad product port- presence in other serious chronic diseases folio in haemophilia. Our legacy recombi- such as cardiovascular diseases (CVD), nant product, NovoSeven®, remains resilient non-alcoholic steatohepatitis (NASH) and in a competitive market, and with our chronic kidney disease (CKD). ® latest, long-acting products, Esperoct and NA�� te� �ells Refixia®, we are expanding our offering for NASH is a progressed stage of non- patients with Haemophilia A, Haemophilia alcoholic fatty liver disease that affects B and rare bleeding disorders. In 2019, we an estimated 30 million people in the US, launched Esperoct® and are accelerating Europe and Japan and for which there our launches to new markets so that many are no approved treatments. NASH is a more patients can benefit from this extend common comorbidity of diabetes and ed half-life factor VIII therapy. We also obesity; 80% of diagnosed NASH patients succeeded in including the use of automat- live with obesity19, while 35% live with ed infusion pumps in the European label for type 2 diabetes.20 We are still exploring the NovoSeven®, a testimony to the strong life potential of semaglutide to offer people cycle management of our legacy products. with NASH better control over their disease as a stand-alone therapy and as a combi- We will accelerate innovation by leveraging nation product together with our partner, all Novo Nordisk R&D technology platforms Gilead, a global pharmaceutical company – using the full spectrum from stem cell specialising in liver diseases. research to formulation and encapsula- tion – to expand our pipeline. In 2019, We are also exploring therapies for treat- we initiated phase 3 clinical trials with ment of cardiovascular diseases. Some of concizumab for Haemophilia A and B with our GLP-1 products reduce the risk of car- and without inhibitors. We are also about diovascular disease and are also currently to begin phase 1 clinical trials with our recommended for the treatment of type next-generation recombinant factor VIII, 2 diabetes for established cardiovascular Mim8, a bispecific antibody for subcutane- disease. Oral semaglutide is being further ous prophylactic treatment in people with investigated in cardiovascular outcomes haemophilia A. Outside of haemophilia we trials and more early-stage projects are in are conducting phase 1 trials with EPI01 in the pipeline. sickle cell disease. Multiple other serious chronic diseases We will look for external assets as well. represent vast unmet medical needs that By joining forces with bluebird bio in are waiting to be defeated. We believe we next-generation genome editing, we aim can use our innovation capabilities to meet to offer a potentially curative treatment for these. We will build a competitive pipeline children and adults with haemophilia A. and leverage our scientific leadership to broaden and widen our portfolio as we Within rare endocrine disorders, we will expand into adjacent disease areas. As maintain our leading position in the growth in other therapy areas, we will nurture hormone segment by offering transforma- partnerships and relationships across tive treatment options. We will continue our field force and R&D with healthcare to explore innovation through all Novo professionals and other stakeholders. New Nordisk R&D platforms. We will build on technologies, including stem cell-based the market-leading quality of our devices, therapies, will help this expansion into support increased rates of diagnosis, new therapeutic areas such as Parkinson’s and continue to work towards bringing disease, dry age-related macular degenera- somapacitan, our next-generation product tion, and chronic heart failure. Forming the intended for once-weekly treatment, to right strategic alliances and transforming market to treat growth hormone disorders. the way we deliver innovation will help us Novo Nordisk Annual Report 2019 Shifting the treatment paradigm from a achieve our aspirations in this area. •

Introducing Novo Nordisk Our business Governance Consolidated statements 14 Pipeline overview Diabetes care Project Indication Description Phase Rybelsus® NN9924 Type 2 diabetes A long-acting oral GLP-1 analogue intended for once-daily oral treatment. Anti-IL-21 GLP-1 T1D A beta-cell preservation treatment intended for adults who are newly NN9828 Type 1 diabetes diagnosed with type 1 diabetes. Insulin icodec (LAI287) NN1436 Type 1 and 2 diabetes A long-acting basal insulin analogue intended for once-weekly treatment. Insulin 965 NN1965 Type 1 and 2 diabetes A novel basal insulin analogue intended for once-daily treatment. Icosema (LAISema) Combination of the GLP-1 analogue semaglutide and the long-acting NN1535 Type 2 diabetes basal insulin icodec intended for once-weekly treatment. Obesity care Semaglutide Obesity NN9536 Obesity A long-acting GLP-1 analogue intended for once-weekly treatment. AM833 NN9838 Obesity A novel long-acting amylin analogue intended for once-weekly treatment. AM833 and semaglutide A combination of the novel amylin analogue and the GLP-1 analogue NN9838 Obesity semaglutide intended for once-weekly treatment. LA-GDF15 A long-acting GDF15 analogue intended for appetite regulation leading NN9215 Obesity to weight loss. GG-co-agonist 1177 NN9277 Obesity A glucagon and GLP-1 receptor co-agonist intended for once-weekly treatment. PYY1875 A novel analogue of the appetite-regulating hormone, PYY, intended NN9775 Obesity for once weekly treatment. Tri-agonist 1706 A novel tri-agonist of the human GIP, GLP-1 and glucagon receptors intended for NN9423 Obesity once-daily treatment. Haemophilia Concizumab Haemophilia A and B with A monoclonal antibody against tissue factor pathway inhibitor intended NN7415 or without inhibitors for subcutaneous prophylaxis treatment. Eclipse Sickle cell disease and beta An oral combination treatment of sickle cell disease. Project is developed NN7533 thalassaemia in collaboration with EpiDestiny. Mim8 Haemophilia A with or A next-generation FVIII mimetic bispecific antibody for subcutaneous prophylaxis NN7769 without inhibitors of haemophilia A regardless of inhibitor status. Combined phase 1/2. Growth disorder Somapacitan AGHD Adult growth hormone A long-acting human growth hormone analogue intended for once-weekly NN8640 deficiency subcutaneous administration in adults. Somapacitan GHD Growth hormone A long-acting human growth hormone analogue intended for once-weekly NN8640 deficiency subcutaneous administration in children. NASH (non-alcoholic steatohepatitis) Semaglutide NN9931 NASH A long-acting GLP-1 analogue for treatment of NASH. A GLP-1 analogue, semaglutide, in combination with an FXR agonist, Gilead:Sema combo cilofexor, an ACC inhibitor, firsocostat, or the three in combination. NN9931 NASH The project is developed in collaboration with Gilead. Cardiovascular disease PCSK9i peptide NN6434 CVD A long-acting PCSK9 inhibitor for subcutaneous treatment. Novo Nordisk Annual Report 2019

Introducing Novo Nordisk Our business Governance Consolidated statements 15 2020 expected key milestones Oral semaglutide Regulatory decision in Japan AM833 Phase 2 results from Amylin in obesity Semaglutide Phase 2 results for semaglutide in NASH Semaglutide Phase 3 results for semaglutide in obesity Ozempic® Phase 3 results for 2 mg Ozempic® Somapacitan Regulatory decision for AGHD in the US and the EU Patent status for marketed products The patent expiry dates for the product portfolio are shown in the table below. The dates provided are for expiry in the US, Germany, China and Japan of patents on the active ingredient, unless otherwise indicated, and include extensions of patent term, when applicable. For several products, in addition to the active ingredient patent, Novo Nordisk holds other patents on manufacturing processes, formulations or uses that may be relevant for exclusivity beyond the expiration of the active ingredient patent. Furthermore, regulatory data protection and/ or orphan exclusivity may apply. Key marketed products in main markets (active ingredients) USA China Japan Germany Diabetes: Human insulin Expired Expired Expired Expired NovoRapid® (NovoLog®) Expired Expired Expired Expired NovoMix® 30 (NovoLog® Mix 70/30) Expired Expired Expired Expired NovoNorm® (Prandin®) Expired Expired Expired Expired Levemir® Expired Expired Expired Expired Victoza® 2023 Expired 2022 2023 Tresiba® 2029 2024 2027 2028 Ryzodeg® 2029 2024 20242 2028 Xultophy® 2029 2024 20242 2028 Fiasp® (2030)3 (2030)3 (2030)3 (2030)3 Ozempic® 20311 2026 20311 2031 Rybelsus® 20311,7 20267 20311,7 20317 Obesity: Saxenda® 2023 Expired Expired 2023 Haemophilia, growth disorders and hormone replacement therapy: Norditropin® (Norditropin® SimpleXx®) Expired Expired Expired Expired MacrilenTM 20278 N/A N/A N/A NovoSeven® Expired4 Expired4 Expired4 Expired4 NovoEight® N/A N/A N/A N/A NovoThirteen® (TRETTEN®) 2021 N/A Expired Expired Refixia® (REBINYN®) 20281 2022 20271 20271 Esperoct® 20321 2029 20341 20341 Vagifem® 10 mcg 20225,6 N/A 20215 N/A 1. Current estimates. 2. Patent term extension until 2027 may apply. 3. Formulation patent; active ingredient patent has expired. 4. Room temperature-stable formulation patent until 2023 in China, Germany and Japan and until 2025 in the US. 5. Patent covers low-dose treatment regimen. 6. Licensed to several generic manufacturers from October 2016. 7. Tablet formulation and once-daily treatment regimen are protected by additional patents expiring in 2031-2034. 8. Protects method of use and kits of parts. Novo Nordisk Annual Report 2019

Introducing Novo Nordisk Our business Governance Consolidated statements 16 Commercial execution: �trate�i� aspirations �or 202� �o��er�ial International e�e�ution • Strengthen Diabetes care leadership – aim at a global value Operations: Building market share of more than 1/3 • Strengthen Obesity care leader- a sustainable ship and double current sales¹ • Secure a sustained growth outlook for Biopharm platform for 1. Based on 2019 sales accelerated growth trends across our geographic regions and therapeutic focus areas, we constantly eval- uate our business decisions and fine-tune our strategy to make sure we meet local market needs and challenges. Our International Operations (IO) unit covers 190 countries and 95% of the world’s population. Around 430 million people are liv- By combining this market fit approach with the business ethics enshrined in the 21 ing with diabetes in these countries and an estimated 570 million Novo Nordisk Way, we believe we have live with obesity.22 The unmet needs are huge, and Novo Nordisk is the framework we need to achieve our gearing up for growth, with a strategic aspiration of 6-10% annual commercial goals sustainably. growth in sales towards 2025. Growing fast and sustainably 2019 demonstrated that our commercial model is working. We accelerated our sales Across IO, the number of people with of each market. We have a diverse port- growth to 11% at CER in 2019 compared diabetes is rising fast. As economies grow, folio of products that enables us to have to around 5% at CER historically. This has so too does the level of access to different suitable offers for all situations – we call been enabled by: types of diabetes treatment. In a business that our market fit approach. For example, • Changing demographics across geogra- unit as broad as IO, this creates a high our range of basal insulin includes human phies that lead to significant increase in degree of complexity due to different levels insulin, modern insulin and next-generation unmet medical needs of security, economic development and insulin – providing us with a solid base • Our market fit approach – where our re- political situation in the respective regions. as a leader in diabetes care. At the same gional teams develop product strategies time, we also offer GLP-1 products that we fit for their areas The fastest increase in type 2 diabetes is expect will drive future growth in Diabetes • Our portfolio of products seen in emerging economies, where rapid and Obesity care. urbanisation leads to more sedentary Looking ahead, our ambition is to drive lifestyles and less healthy diets. Type 2 dia- There are local market considerations, too. growth by establishing leadership in the betes in younger people is also a significant In Latin America, for example, we are basal insulin space, accelerating the growth global trend that will increasingly affect the seeing an increase in healthcare spending. of the GLP-1 market, and expanding the way we operate commercially. However, this is counterbalanced by high obesity market. political risks – for example, high inflation With type 2 diabetes so closely linked to rates in Venezuela and Argentina. We want to broaden access to diabetes obesity, these trends are also informing our treatments – and make treatment more obesity strategy. As the number of younger In China, meanwhile, a huge ageing affordable. This is where we can strengthen people with obesity grows, so does the population points to growing unmet our market leadership in basal insulin. number of instances of diabetes in people medical needs in the future. As a result, in their 30s and 40s. At this age, these are healthcare is high on the Chinese govern- Last year, Tresiba® became available to primarily working people, which means ment’s agenda through general reform and patients in France, Germany and China, that doctors need to give them different programmes such as Healthy China 2030. and we are already beginning to see more guidance to what they might tell a retiree. patients benefiting from this, our flagship Across IO, Novo Nordisk holds the leading next-generation basal insulin. In the next A market fit approach diabetes value market share in most few years, we expect to launch Tresiba® To ensure as many as possible of these countries. In markets where this is not the and Xultophy® in several other countries people can access our treatments, we tailor case, we want to grow our share. In order where new-generation insulin are not Novo Nordisk Annual Report 2019 our strategic approach to the specific needs to respond to the diverse conditions and available today.

Introducing Novo Nordisk Our business Governance Consolidated statements 17 Whilst we remain value leaders in the Saxenda® is already delivering value here, with the government in China to provide GLP-1 market, we are facing increased with around 72% of market growth digital healthcare solutions. One example is competitive pressures and a decline in our over the last year. We plan for several WeDoctor – a nationwide medical consult- market share in some IO regions. This year, more launches between 2020 and 2022, ing platform connecting an astounding 172 we focused on turning this trend around. at which point we hope to be ready to million patients and 300,000 doctors. This We are leveraging the label update for introduce semaglutide for obesity into this platform allows patients and doctors to Victoza® achieved on the basis of results fast-growing therapy area. stay in touch via a user-friendly mobile app. from the LEADER trial, which showed that liraglutide is associated with significant In Biopharm we will focus on expanding But when it comes to delivering better cardiovascular risk reduction in people with our footprint in haemophilia A and B. Hae- treatments to people living with diabetes, type 2 diabetes. Meanwhile, we are rolling mophilia A constitutes the largest patient obesity or other chronic diseases, commer- out Ozempic® as fast as we can wherever population in haemophilia and our ability cial innovation can be just as important there is a market opportunity. This is to secure a leading position in rare blood as product innovation. This is why we helping us to increase our share of market disorders will be driven by our success constantly assess and - if necessary - growth, bringing us closer to realising our in growing sales with NovoEight® and rethink the way we execute our strategy. medium-term ambition of more than 50%. Esperoct®. Furthermore, we are confident This year, for example, we created separate that an increasing number of patients living teams for GLP-1, insulin and Biopharm, We are also planning launches of the first with haemophilia B will choose Refixia®. respectively, to give each area more focus and only GLP-1 in a tablet, Rybelsus®, in and decision-making autonomy. • the same timeframe. Because Rybelsus® Combining research and commercial will follow a route driven by general prac- innovation titioners and patient demands it is likely to We believe Rybelsus® – our semaglu- put pressure on our field force capacities, tide-based oral diabetes medicine – will as our representatives will have to reach transform the lives of millions of people far more healthcare professionals and have across IO by helping people to manage less time with each. We are mitigating this their disease. Our aim, therefore, is to by exploring partnerships that can give secure broad access to this world-first us extra and flexible field force resources innovation, and we are already taking steps when we need them. to ensure this ahead of the product’s first IO launch. To maximise the opportunity this presents, we have agreed to enter a co-promotion We are also capitalising on innovation partnership with the major pharmaceu- developments in different regions. For tical firm MSD, whose vast experience in example, in China, the government’s push marketing oral antidiabetics (OADs) to Jap- for innovation in healthcare is helping us anese diabetes specialists is key our efforts broaden and deepen our relationships to bring the treatment into the hands of as there. The Chinese government is enabling many people as possible. quicker clinical review and encouraging the use of generics to drive more cost- In Obesity care, we are investing to expand efficiency – meaning we will have shorter the market by working with a variety of windows of opportunity and shorter stakeholders including policymakers to product lifecycles. ensure that it is more widely recognised as a disease that can be tackled through To help Chinese patients better manage medical intervention. their diabetes, we are working closely Novo Nordisk dia�etes value �arket s�are and s�are o� �ro�t� in �nternational �perations NN share of growth NN market share % 25 23.1% 22.0% 20 20.7% 15 10 7.4% 5 0 Nov 2016 Nov 2019 Novo Nordisk Annual Report 2019

Introducing Novo Nordisk Our business Governance Consolidated statements 18 Commercial execution: �trate�i� aspirations �or 202� �o��er�ial North America e�e�ution • Strengthen Diabetes care leadership – aim at a global value Operations: Ready market share of more than 1/3 • Strengthen Obesity care leader- for growth in a ship and double current sales¹ • Secure a sustained growth outlook for Biopharm challenging business 1. Based on 2019 sales environment • Rybelsus®, our oral semaglutide medi- cine for type 2 diabetes, was approved by the US Food & Drug Administration (FDA) in September 2019, with the first prescriptions written the following month, • In January 2020, Ozempic® our once-weekly type 2 diabetes medicine, Around half of our global sales are generated in the US, making our was approved in the US for cardiovascu- North America operations – the US and Canada – a critical compo- lar risk reduction in people with type 2 diabetes and established cardiovascular nent of our business. We are successfully transforming our business disease. by utilising the potential of our innovative product offerings and • Ozempic® reached global blockbuster we have strengthened our commitment to our social responsibility status in September 2019, with the bulk to make insulin available to all patients. of sales generated in the US. Innovating for diabetes leadership Our ultimate goal for diabetes treatment More than 30 million people in the transition to remain a market leader and is to help patients live as full and healthy US live with diabetes.23 Of those, millions secure future growth, contributing to the lives as possible. We want to change how remain undiagnosed and are not getting company’s overall goal to achieve a global the disease is treated and how it is viewed, proper treatment. diabetes value market share of more than offering products that meet medical needs one-third. Towards 2022, it is expected that and match patients’ lifestyles. The numbers are just as alarming in obesity around 70% of sales will be from inno- – if not more so. According the Centers for vative new products, while the remaining We built our position as the world’s larg- Disease Control & Prevention, more than 30% will be legacy products. To help us est insulin producer through innovative 93.3 million people were living with obesity reach our medium-term goals, we have injectable drugs. Going forward, we will in 201624, costing the US healthcare system a clear growth strategy centred around transform the market with our indus- 1.72 trillion US dollars annually.25 bringing innovative new products to mar- try-first GLP-1 in a tablet, Rybelsus®. In the ket – and increasing our market share. US, around 70% of diabetes prescriptions The unmet needs are beyond question and are for oral treatments, and so far none are have brought about new dynamics in the Our GLP-1 offerings provide improved from the highly effective GLP-1 class which marketplace. Payer consolidation puts pres- treatment for broader segments of pa- we specialise in. We are confident that the sure on prices of medicines, government tients. Meanwhile, we continue to deliver launch of Rybelsus® will change this. interventions aim to address structural insulins and grow the volume amidst pric- barriers to effective care, healthcare is ing challenges. We are building the market But our focus is not only on portfolio inno- undergoing a digital transformation, and for obesity care, enhancing growth oppor- vation; we also need to improve access and across all of these looms the urgency of tunities for our innovative products. And play a key role in prevention. This means providing affordable care for uninsured and we remain committed to serving patients effecting change everywhere that influenc- underinsured people like those in high-de- with haemophilia and growth disorders. es, or is influenced by the disease – includ- ductible healthcare plans. ing research, education, public policy, as Reaching significant milestones well as humanitarian and outreach efforts. Successfully adapting to the new busi- We have reached three very important ness environment milestones, all of which emphasise the Championing affordability for patients In this challenging business environment, strength of our existing – and future – GLP- in a complex healthcare system Novo Nordisk Annual Report 2019 Novo Nordisk is going through a historic 1 franchise: Tackling the structural challenges in

Introducing Novo Nordisk Our business Governance Consolidated statements 19 the US healthcare system calls for long- stakeholders to advocate for the Treat �n a �e� �ears� Novo Nordisk ��A term reform changes to make sustainable and Reduce Obesity Act, a vital piece of aspire to �ave and meaningful affordability a reality. legislation that will improve access to care We are doing our part and updating our for people with obesity. The Act addresses support offerings, engaging with multiple policy barriers to obesity care and cover- new blockbusters stakeholders. We acknowledge the role age, including access to pharmacotherapy. on the market of list prices, but more needs to be done 2 to improve how insurance benefits cover All of these measures are helping shift essential medicines, especially through high social perspectives towards recognition of notably increase deductible health plans. See our offerings obesity as a chronic disease and empower the number of to provide affordable insulin in 'Leading a people living with obesity in the US to seek patients treated sustainable business'. and receive the respectful, complete care they deserve. Advocating for stronger obesity focus turned around approx. and policies Promising prospects in biopharm 70% of sales We have a clear ambition to offer medical Haemophilia remains a key focus in our (from 2015) treatment for more people with obesity biopharm business. We want to help and expect to double the sales of our patients living with this disease manage it obesity products globally by 2025. In the better so they can lead healthier and more US and Canada, we work to bring superior fulfilling lives. treatments to market, and engage with key stakeholders and policymakers to make The FDA approval of Esperoct® in Febru- obesity a healthcare priority. ary 2019 and the Breakthrough Therapy Designation for concizumab for prophylaxis The launch of our Changing Obesity™ treatment in people with haemophilia B aspiration in January 2019 underscores with inhibitors were important milestones our commitment to change how the world in the fight against this serious chronic sees, treats and works to prevent obesity. disease. In this effort we work with partners from both public and private sectors. In our growth disorders business, we are awaiting the response on somapacitan – A case in point is our contribution – via an a new long-acting growth hormone for educational grant – to the establishment of treatment in adults with growth hormone the US Obesity Medicine Clinical Fellow- deficiency, which we submitted for the ship Development Program. Thanks to this US FDA regulatory approval in September grant, the Obesity Society and the Obesity 2019. • Medicine Association are working to in- crease the number of physicians with spe- cialised training in caring for and treating patients with obesity and its complications. In 2019, seven new Obesity Fellowships were awarded. We also invested considerable time and resources in and joined forces with key Novo Nordisk dia�etes value �arket s�are and s�are o� �ro�t� in Nort� A�eri�a �perations NN share of growth NN market share % 50 37.4% 40 28.5% 31.1% 30 22.9% 20 10 0 Nov 2016 Nov 2019 Novo Nordisk Annual Report 2019

Introducing Novo Nordisk Our business Governance Consolidated statements 20 Financials: �trate�i� aspirations �or 202� 2019 performance and �inan�ials 2020 outlook • Deliver solid sales and operating proﬁt growth – Deliver 6-10% sales growth in International Operations – Transform 70% of sales in the USA2 Financial performance In the following sections, unless otherwise Novo Nordisk's 2019 performance for sales noted, market data are based on moving • Drive operational efﬁciencies measured at constant exchange rates (CER) annual total (MAT) from November 2019 across the value chain to enable exceed the outlook provided in February and November 2018 provided by the inde- investments in future growth 2019, while operating profit measured at pendent data provider IQVIA. assets CER was within the range provided in Feb- • Deliver free cash ﬂow to enable ruary 2019. The free cash flow marginally Insulin attractive capital allocation to exceeded the outlook provided in February Sales of insulin remained unchanged in shareholders 2019, while the tax rate was lower follow- Danish kroner and decreased by 3% at CER 2. From 2015 to 2022 ing a positive impact from non-recurring to DKK 59,693 million. The decreased sales changes to deferred tax assets. Capital measured at CER were driven by declining expenditure was broadly in line with the sales in the USA, partly offset by increased guidance provided in February 2019. sales in International Operations. �ales �ro�t� Geographic sales development Sales of long-acting insulin remained In DKK as reported Sales increased by 9% measured in Danish unchanged in Danish kroner and decreased At constant exchange rates kroner and by 6% at CER to DKK 122,021 by 4% at CER to DKK 20,776 million. Novo % million in 2019. Sales in International Nordisk has improved its global volume 25 Operations increased by 12% measured in market share in the long-acting insulin seg- Danish kroner and by 11% at CER. Sales in ment from 31.6% to 32.4% in the last 12 20 North America Operations increased by 6% months. The decreased sales measured at ® measured in Danish kroner and by 1% at CER were driven by declining Levemir sales, 15 CER. The sales growth is in line with the lat- partly offset by a positive impact from Tresi- est guidance of '5-6% sales growth at CER' ba® and Xultophy®. Tresiba® has now been 10 provided in connection with the announce- launched in 86 countries, while Xultophy® ment in November 2019 for the financial has now been launched in 37 countries. 5 results of the first nine months of 2019. Sales of premix insulin increased by 4% 0 Sales development across measured in Danish kroner and by 2% at 2015 2016 2017 2018 2019 therapeutic areas CER to DKK 10,578 million. Novo Nordisk Sales growth in 2019 was 9% measured in is market leader in the premix insulin Danish kroner and 6% at CER was driven segment with a global volume market ��are o� �ro�t� at �onstant e��an�e rates by solid growth across all therapy areas with share of 63.9%, which has been broadly Region Europe Region AAMEO Diabetes care sales growth of 4% (CER), unchanged over the past 12 months. The Region China Region Japan & Korea Obesity care sales growth of 42% (CER) increased sales were driven by increased Region Latin America ® and Biopharm sales growth of 4% (CER). sales of Ryzodeg , partly offset by declining North America Operations NovoMix® sales. Ryzodeg® has now been Diabetes care, sales development launched in 30 countries. % Sales in Diabetes care increased by 8% 100 measured in Danish kroner and by 4% at Sales of fast-acting insulin remained un- CER to DKK 97,161 million driven by solid changed in Danish kroner and decreased 80 GLP-1 growth, partly offset by declining by 3% at CER to DKK 19,303 million. 60 insulin sales. Novo Nordisk has improved Novo Nordisk is market leader in the its global diabetes value market share over fast-acting insulin segment with a global 40 the last 12 months from 27.8% to 28.6%, volume market share of 50.7%, which has driven by improved global insulin market been broadly unchanged over the past 12 20 share and growth of the GLP-1 segment, months. The decreasing sales measured reflecting an expansion of the diabetes at CER were driven by declining sales of 0 ® value market share in North America NovoRapid , partly offset by a positive 2015 2016 2017* 2018* 2019 ® ® Operations and a stabilisation of the value impact from Fiasp . Fiasp has now been * In 2017, North America contributed -5% to the total growth * In 2018, Japan & Korea contributed -2% to the total growth Novo Nordisk Annual Report 2019 market share in International Operations. launched in 33 countries.

Introducing Novo Nordisk Our business Governance Consolidated statements 21 Sales of human insulin decreased by 2% settings and a wide range of labelled indi- �ales �� se��ent measured in Danish kroner and by 5% at cations in an increasingly competitive envi- Biopharm CER to DKK 9,036 million. ronment. The sales development is driven Diabetes and Obesity care by increased sales in Region Latin America, DKK billion GLP-1 therapy for type 2 diabetes Region AAMEO and Region China as well 125 Sales of GLP-1 products for type 2 diabe- as stable sales in North America Operations tes (Victoza®, Ozempic® and Rybelsus®) offset by declining sales in Region Europe 100 increased by 27% measured in Danish and Region Japan & Korea. kroner and by 22% at CER to DKK 33,221 75 million. Sales growth was driven by both Sales of NovoEight® increased by 13% North America Operations and Inter- measured in Danish kroner and by 10% at 50 national Operations. Sales of Ozempic® CER to DKK 1,525 million. Sales growth 25 were DKK 11,237 million and Ozempic® was driven by Region Latin America, has now been launched in 26 countries in Region AAMEO, Region Europe and North 0 ® North America Operations, Region Europe, America Operations. NovoEight has now 2015 2016 2017 2018 2019 Region Latin America and Region AAMEO. been launched in 52 countries. The GLP-1 segment’s value share of the to- tal diabetes market has increased to 18.0% Sales of Refixia® increased to DKK 382 compared with 14.4% 12 months ago. million. Sales growth was driven by the Operating proﬁt Novo Nordisk continues to be the global product launches in Region Europe, Operating proﬁt margin (left) market leader in the GLP-1 segment with a Region Japan & Korea and North America Operating proﬁt (right) 47.5% value market share. Operations. Refixia® has now been DKK billion % launched in 16 countries. 60 60 Obesity care, sales development 50 Sales of Saxenda® increased by 47% Esperoct® has now been launched in nine 50 measured in Danish kroner and by 42% at countries and the initial feedback from 40 40 CER to DKK 5,679 million. Sales growth of patients and physicians is encouraging. 30 Saxenda® was driven by both International 30 Operations and North America Operations. Growth disorders (Norditropin®) 20 20 Saxenda® has now been launched in 46 Sales of growth disorder products increased 10 countries. Novo Nordisk currently has a by 6% measured in Danish kroner and 10 value market share of 56% of the global by 2% at CER to DKK 7,275 million. The 0 0 obesity prescription drug market. increasing sales were driven by Internation- 2015 2016 2017 2018 2019 al Operations increasing by 3% at CER and Biopharm by North America Operations increasing Biopharm, sales development by 2% at CER. Novo Nordisk is the leading Sales of biopharm products increased by company in the global human growth 7% measured in Danish kroner and by 4% disorder market with a market share mea- at CER to DKK 19,181 million. The sales sured in value of around 33% driven by development was driven by sales growth new indications and the introduction of the in both operating units as well as across next-generation device. both franchises: Haemophilia and Growth disorders. Sales growth in International Development in costs and Operations was driven by Region Latin operating profit America, Region AAMEO, Region China The cost of goods sold increased by 14% and Region Japan & Korea. measured in Danish kroner and by 12% at CER to DKK 20,088 million, resulting in a Haemophilia gross margin of 83.5% measured in Danish Sales of haemophilia products increased kroner, compared with 84.2% in 2018. The by 7% measured in Danish kroner and by decrease in gross margin reflects a negative 4% at CER to DKK 10,281 million. The in- impact from lower realised prices in the creasing sales were driven by the continued USA and impairment of intangible assets, global roll-out of Refixia® and NovoEight®. partly countered by a positive product Novo Nordisk continues to expand its mix driven by increased GLP-1 sales and a broad global haemophilia presence. positive currency impact of 0.3 percentage point. Sales of NovoSeven® increased by 3% measured in Danish kroner, and remained Sales and distribution costs increased by unchanged at CER, to DKK 8,119 million, 8% measured in Danish kroner and by 6% reflecting the solid position of NovoSeven® at CER to DKK 31,823 million. The increase Novo Nordisk Annual Report 2019 as a haemostatic agent in critical treatment in sales and distribution costs was

Introducing Novo Nordisk Our business Governance Consolidated statements 22 driven by International Operations reflect- Operating profit increased by 11% in Free cash ﬂow ing resource allocation to growth markets Danish kroner and by 6% at CER to DKK and promotional activities for Victoza® and 52,483 million, which is in line with the DKK billion launch activities for Ozempic®, promotional latest guidance for operating profit growth 40 activities for insulin, particularly in China, measured at CER of '4-6%' in 2019. as well as promotional activities for the 30 continued roll-out of Saxenda®. In the Financial items (net) and tax USA, promotional activities are focusing on Financial items (net) showed a net loss of Ozempic® and Saxenda® as well as launch DKK 3,930 million compared with a net 20 activities for Rybelsus®, partly offset by gain of DKK 367 million in 2018. The re- lower promotional spend related to insulin. ported net financial items in 2019 is in line 10 with the latest guidance of 'loss of around Research and development costs decreased DKK 3.9 billion'. 0 by 4% measured in Danish kroner and by 2015 2016 2017 2018 2019 6% at CER to DKK 14,220 million, posi- In line with Novo Nordisk’s treasury policy, tively impacted by reversal of write-downs the most significant foreign exchange risks of prelaunch inventory in first quarter of for the Group have been hedged, primarily 2019 following the filing of Rybelsus® to through foreign exchange forward con- the US FDA, severance costs in second half tracts. The foreign exchange result was a line with the latest guidance of 'around of 2018 and the expense of the priority loss of DKK 3,212 million compared with DKK 9 billion'. Capital expenditure was review voucher for Rybelsus® in fourth a gain of DKK 298 million in 2018. This primarily related to investments in a new quarter of 2018 partly offset by impair- development reflects a loss on foreign production facility for diabetes active phar- ment of intangible assets in 2019. The exchange hedging, especially related to the maceutical ingredients in Clayton, North underlying increase in R&D costs is driven US dollar versus the Danish krone. Carolina, USA, expansion of production by increased costs for the semaglutide facilities in Kalundborg, Denmark, expan- in obesity clinical programmes STEP and As per the end of December 2019, a sion of production facilities in Chartres, SELECT, the ramp-up of the SOUL cardio- negative market value of financial contracts France and a new diabetes filling capacity vascular outcomes trial with Rybelsus® as of approximately DKK 0.3 billion has been in Hillerød, Denmark. well as increased costs for the semaglutide deferred for recognition in 2020. NASH development activities, partly offset Free cash flow was DKK 34.5 billion com- by the completion of the Rybelsus® phase The effective tax rate was 19.8% in 2019 pared with DKK 32.5 billion in 2018, which 3a development programme and the com- compared with an effective tax rate of is in line with the latest guidance of 'DKK pletion of the head-to-head study between 18.9% in 2018. The reported effective 31-35 billion'. The increase of 6% com- Tresiba® and insulin glargine U300. tax rate of 19.8% is in line with the latest pared with 2018 primarily reflects increased guidance of a tax rate of '19-21%' for cash from operating activities driven by the Administration costs increased by 2% mea- 2019. The effective tax rate for 2019 was timing of rebate payments in the USA. sured in Danish kroner and by 1% at CER positively impacted by minor non-recurring to DKK 4,007 million, reflecting increased changes to deferred tax assets following legal costs while spend across administra- the approval of the Swiss tax reform, while tive areas was broadly unchanged. non-recurring changes in tax provisions related to settlement of international tax Other operating income (net) was DKK cases positively impacted the 2018 tax rate. 600 million compared with DKK 1,152 million in 2018. The decline in Other Capital expenditure and free cash operating income (net) in 2019 compared flow with 2018 reflects non-recurring income in Capital expenditure for property, plant and 2018 and decrease in income from licence equipment was DKK 8.9 billion compared agreements. with DKK 9.6 billion in 2018, which is in Key invoicing Impact on Novo Nordisk's operating profit in the next 12 Hedging period currencies months of a 5% movement in currency (months) USD DKK 1,950 million 9 CNY1 DKK 450 million 7 JPY DKK 150 million 12 CAD DKK 130 million 9 GBP DKK 100 million 10 1 Novo Nordisk Annual Report 2019 Chinese yuan traded offshore (CNH) used as proxy when hedging Novo Nordisk’s CNY currency exposure

Introducing Novo Nordisk Our business Governance Consolidated statements 23 Outlook 2020 (API) production within Diabetes care and The current expectations for 2020 are summarised in the table below: an expansion of thefilling capacity within Diabetes care. Depreciation, amortisation Expectations are as reported, if not otherwise stated Expectations 5 February 2020 and impairment losses are expected to be around DKK 5 billion. The decline in depre- Sales growth ciation, amortisation and impairment losses at CER 3% to 6% as reported Around 1 percentage point higher than at CER in 2020, compared with the level in 2019, reflects higher levels of impairment losses Operating profit growth in 2019. Free cash flow is expected to be at CER 1% to 5% DKK 36-41 billion. as reported Around 1 percentage point higher than at CER All of the above expectations are based Financial items (net) Loss of around DKK 1.5 billion on assumptions that the global or regional Effective tax rate 20% to 22% economic and political environment will Capital expenditure (PP&E) Around DKK 6.5 billion not significantly change business conditions for Novo Nordisk during 2020, including Depreciation, amortisation and impairment losses Around DKK 5 billion the potential implications from major Free cash flow DKK 36-41 billion healthcare reforms, and that the currency exchange rates, especially the US dollar, will remain at the current level versus the For 2020, sales growth is expected to activities related to the commercial priorities Danish krone. Neither does the guidance be 3% to 6%, measured at CER. This across the operating units including the include the financial implications in case guidance reflects expectations for robust introduction of Rybelsus® in the USA, the of a significant bolt-on acquisition during performance for the GLP-1-based diabetes continued global expansion of the injectable 2020. Furthermore, the guidance does not care products Ozempic®, Victoza® and Ry- GLP-1 diabetes franchise, the global invest- include any significant impact from the belsus®, the obesity care product Saxenda®, ment in building an anti-obesity market outbreak of coronavirus. the portfolio of new-generation insulin and and the promotional activities for roll-out of the contribution from the biopharm prod- the Biopharm portfolio. Given the current Novo Nordisk has hedged expected net ucts Esperoct®, Refixia® and NovoEight®. exchange rates versus the Danish krone, cash flows in a number of invoicing cur- The guidance also reflects intensifying com- growth reported in DKK is expected to be 1 rencies and, all other things being equal, petition both within Diabetes care and Bio- percentage point higher than at CER. movements in key invoicing currencies will pharm, especially within the haemophilia impact Novo Nordisk’s operating profit as inhibitor segment. Furthermore, continued For 2020, Novo Nordisk expects financial outlined in the table Key invoicing currencies. pricing pressure within Diabetes care as items (net) to amount to a loss of around well as expansion of already announced af- DKK 1.5 billion, offsetting the positive Long-term financial targets fordability initiatives, especially in the USA, currency impact on operating profit. The Novo Nordisk introduced four long-term are expected to impact sales development. current expectation for 2020 primarily financial targets in 1996 to balance short- Given the current exchange rates versus reflects losses associated with foreign and long-term considerations . The targets the Danish krone, growth reported in DKK exchange hedging contracts, mainly related were subsequently revised and updated is expected to be around 1 percentage to the US dollar and Chinese yuan versus on several occasions, most recently in con- point higher than at CER. the Danish krone. nection with the Annual Report for 2018 released in February 2019. For 2020, operating profit growth is expect- The effective tax rate for 2020 is expected ed to be 1% to 5%, measured at CER. The to be in the range of 20-22%. With the performance in 2019, Novo Nor- expectation for operating profit growth pri- disk has met its long-term financial targets marily reflects the sales growth outlook and Capital expenditure is expected to be comprising average operating profit growth continued focus on resource allocation. Op- around DKK 6.5 billion in 2020, primarily of 5%, cash-to-earnings of 85% (3-year erating profit growth is negatively impacted relating to investments in additional ca- average) and operating profit after tax over by increased investments in commercial pacity for active pharmaceutical ingredient net operating assets (OPAT/NOA) of 80%. Long-term financial targets Average 2016 - 2019 2018 2017 2016 2019 Target Operating profit growth at CER1 5.6% 2.8% 4.8% 6.2% 4.9% 5% Operating profit after tax to net operating assets 98.0% 116.7% 143.2% 150.2% 80% Cash to earnings 88.4% 84.2% 85.5% 105.4% Cash to earnings (three-year average) 86.0% 91.7% 96.4% 102.4% 85% 1 Operating profit growth at CER for 2016 is adjusted for DKK 2,376 million from the partial divestment of associated company and DKK 449 million from the income related to the out-licensing of Novo Nordisk Annual Report 2019 assets for inflammatory disorders in 2015.

Introducing Novo Nordisk Our business Governance Consolidated statements 24 Strategic aspirations for 2025 • statements containing projections of or Novo Nordisk’s results or the accuracy of To reflect the broad growth aspects of targets for revenues, costs, income (or forward-looking statements in this Annual Novo Nordisk across therapy areas and loss), earnings per share, capital expen- Report 2019, reference is made to the geographies, the historic approach to long- ditures, dividends, capital structure, net overview of risk factors in ‘Managing risks term financial targets focusing on specific financials and other financial measures, to protect value’ of this Annual Report financial aspects is no longer sufficiently • statements regarding future economic 2019. describing Novo Nordisk’s future growth performance, future actions and out- outlook. Consequently, Novo Nordisk come of contingencies such as legal Unless required by law, Novo Nordisk is announced in connection with its Capital proceedings, and under no duty and undertakes no obliga- Markets Day in November 2019 that it is • statements regarding the assump- tion to update or revise any forward-look- replacing the current long-term financial tions underlying or relating to such ing statement after the distribution of targets structure with a more comprehen- statements. this Annual Report 2019, whether as a sive approach describing the future growth result of new information, future events or aspirations of the company under the In this Annual Report 2019, examples of otherwise. • headline: Strategic aspirations for 2025. forward-looking statements can be found under the headings '2019 Performance The strategic aspirations, reflecting the and 2020 outlook' and elsewhere. sustained growth opportunities until 2025, are intended to cover future growth drivers These statements are based on current of Novo Nordisk and thereby providing plans, estimates and projections. By their investors with an understanding of Novo very nature, forward-looking statements in- Nordisk’s growth and investment opportu- volve inherent risks and uncertainties, both nities across therapy areas and geographies. general and specific. Novo Nordisk cautions that a number of important factors, includ- The strategic aspirations are objectives that ing those described in this Annual Report Novo Nordisk intends to work towards 2019, could cause actual results to differ and are not a projection of Novo Nordisk's materially from those contemplated in any financial outlook or expected growth. Novo forward-looking statements. Nordisk intends to describe how its activi- ties develop in relation to each of the four Factors that may affect future results dimensions on an ongoing basis. include, but are not limited to, global as well as local political and economic Forward-looking statements conditions, including interest rate and Novo Nordisk’s reports filed with or fur- currency exchange rate fluctuations, delay nished to the US Securities and Exchange or failure of projects related to research Commission (SEC), including this statutory and/or development, unplanned loss of Annual Report 2019 and Form 20-F, which patents, interruptions of supplies and are both expected to be filed with the SEC production, product recalls, unexpected in February 2020 in continuation of the contract breaches or terminations, gov- publication of this Annual Report 2019, ernment-mandated or market-driven price and written information released, or oral decreases for Novo Nordisk’s products, in- statements made, to the public in the troduction of competing products, reliance future by or on behalf of Novo Nordisk, on information technology, Novo Nordisk’s may contain forward-looking statements. ability to successfully market current and Words such as ‘believe’, ‘expect’, ‘may’, new products, exposure to product liability ‘will’, ‘plan’, ‘strategy’, ‘prospect’, ‘foresee’, and legal proceedings and investigations, ‘estimate’, ‘project’, ‘anticipate’, ‘can’, ‘in- changes in governmental laws and related tend’, ‘target’ and other words and terms interpretation thereof, including on reim- of similar meaning in connection with any bursement, intellectual property protec- discussion of future operating or financial tion and regulatory controls on testing, performance identify forward-looking state- approval, manufacturing and marketing, ments. Examples of such forward-looking perceived or actual failure to adhere to statements include, but are not limited to: ethical marketing practices, investments in and divestitures of domestic and foreign • statements of targets, plans, objectives companies, unexpected growth in costs or goals for future operations, includ- and expenses, failure to recruit and retain ing those related to Novo Nordisk’s the right employees, and failure to main- products, product research, product tain a culture of compliance. development, product introductions and product approvals as well as cooperation For an overview of some, but not all, Novo Nordisk Annual Report 2019 in relation thereto, of the risks that could adversely affect

Introducing Novo Nordisk Our business Governance Consolidated statements 25 Research and tion from the European Commission in the Biopharm beginning of second quarter of 2020. Regulatory events development Based on the ELLIPSE trial, we obtained a We obtained approval of Esperoct® (the label expansion for Victoza® which now in- brand name for N8-GP) in the US, the EU cludes an indication for the use in children and Japan for prophylaxis and on-demand In 2019, we made significant prog- and adolescent, aged 10-17 with type 2 treatment of all age groups, in the EU above ress in research and development pipeline, diabetes in the US and Europe. 12 years of age, of haemophilia A patients. reaching several important regulatory milestones. Key development projects are Clinical progress In addition, the regulatory file was submit- highlighted below, along with a pipeline The SOUL trial was initiated, a dedicated ted for the once-weekly growth hormone overview of compounds in clinical develop- diabetes cardiovascular outcome trial, derivative, somapacitan, for the treatment ment. Further details on clinical trials can aiming to confirm the cardiovascular of adult growth hormone deficiency, to the be found in company announcements and benefits of oral semaglutide and expand US FDA and EMA. press releases published by Novo Nordisk the scientific evidence base of semaglutide. during 2019, available at novonordisk.com The SOUL trial is expected to enrol Clinical progress approximately 9,600 people. We initiated the phase 3 programme (REAL Diabetes care 4) for somapacitan in children with growth Three phase 3b trials were initiated with hormone deficiency. Regulatory events subcutaneous (sc) once-weekly semaglu- We submitted a New Drug Applications tide: SUSTAIN FORTE, with the objective Furthermore, we initiated the explorer7 (NDA) to the US Food and Drug Admin- to compare and assess the efficacy and and explorer8 phase 3 clinical trials with istration (FDA) for oral semaglutide, a safety of sc semaglutide 2 mg compared to subcutaneous prophylactic treatment of once-daily glucacon-like peptide-1 (GLP-1) sc semaglutide 1 mg in people with type concizumab in people with haemophilia A receptor agonist, as a treatment to improve 2 diabetes. FOCUS, a diabetic retinopathy or B with inhibitors and a parallel trial in glycaemic control in adults with type 2 dia- outcomes trial, with the objective to assess haemophilia A or B patients without inhib- betes. This resulted in FDA approval in Sep- the long-term effects of sc semaglutide in itors. The objective of these trials is to es- tember 2019, of the first GLP-1 in a tablet, people with type 2 diabetes. Lastly, FLOW, tablish the safety and efficacy of once-daily Rybelsus®. The approval was based on the a diabetic nephropathy outcomes trial, with subcutaneous concizumab as a pen device phase 3a PIONEER development pro- the objective of assessing the effect of sc based on prophylactic treatment to reduce gramme, which included 9,543 adults with semaglutide on the progression of renal the number of bleeds. type 2 diabetes. We launched Rybelsus® in impairment in people with type 2 diabetes the US in the fourth quarter of 2019. and chronic kidney disease. We initiated the phase 1/2 trial for Mim8. Mim8 is a next-generation factor VIII mi- A second NDA was submitted for oral Furthermore, Novo Nordisk completed metic bi-specific antibody for subcutaneous semaglutide and a supplementary NDA a phase 2 trial with the combination of prophylaxis of haemophilia A regardless of (sNDA) for Ozempic® (once-weekly inject- anti-IL-21 and liraglutide in people with inhibitor status. able semaglutide), seeking approval for a newly diagnosed type 1 diabetes. The trial separate indication for cardiovascular risk demonstrated statistically significantly im- Other serious chronic diseases reduction in adults with type 2 diabetes. proved beta cell function with anti-IL-21 in These applications are based on results combination with liraglutide compared to Clinical progress from two cardiovascular outcomes trials placebo. Together with regulatory authori- Gilead Sciences, Inc. and Novo Nordisk (CVOTs) evaluating the effects of adding ties, Novo Nordisk is evaluating next steps. established a collaboration on clinical trial semaglutide or placebo to standard of activities, by combining compounds from care on the risk of cardiovascular events, Lastly, Novo Nordisk completed the 26-week their respective pipelines in non-alcoholic namely, PIONEER 6 with oral semaglutide phase 2 trial with insulin icodec (previously steatohepatitis (NASH). The clinical trial and SUSTAIN 6 with Ozempic®. On the named LAI287). Insulin icodec is anticipated is a proof-of-concept study combining basis of the submitted data, Ozempic® to be the first once-weekly insulin and have Novo Nordisk's semaglutide and Gilead's was approved in the USA for cardiovas- similar glucose-lowering effect and safety small molecules; the FXR agonist cilofexor cular risk reduction in people with type profile to once-daily insulin glargine U100. and the ACC inhibitor firsocostat for the 2 diabetes. The Rybelsus® US label was Based on the phase 2 results, Novo Nordisk treatment of people with NASH. Results are updated with additional results from the plans to initiate a phase 3 clinical trial pro- expected in the first half of 2020. PIONEER 6 trial. gramme in second half of 2020. Finally, we initiated the first human dose trial On 31 January the committee for medicinal Obesity care (phase 1) for a subcutaneous PCSK9i. The products for human use (CHMP) under trial is designed as a dose escalation trial the EMA adopted a positive opinion, Clinical progress with the aim to establish the safety, tolera- recommending marketing authorisation for We initiated a phase 2 trial for the long-act- bility and pharmacokinetics of PCSK9i. The Rybelsus® (oral semaglutide) for the treat- ing amylin analogue AM833, intended trial will form the basis for a review of the ment of adults with type 2 diabetes. We for chronic weight management with a options for further drug development of a Novo Nordisk Annual Report 2019 expect to receive final marketing authorisa- once-weekly subcutaneous administration. PCSK9i within the cardiometabolic space. •

Introducing Novo Nordisk Our business Governance Consolidated statements 26 In addition, Novo Nordisk entered a 5-year Social performance living wage programme with an external global non-profit business network and consultancy. The objective is to ensure that all employees are paid a living wage, i.e. adequate to purchase basic goods and ser- vices necessary to achieve a basic standard of living, based on calculations of living wages in the countries we operate in. An analysis indicated that this is the case. Novo Nordisk accounts for social Novo Nordisk has several initiatives, performance on three dimensions: patients, programmes and partnerships focused on By the end of 2019, the gender distribution employees and responsible business in increasing access to care all over the world. among managers was 60% men and 40% pursuit of the ambition to be a sustainable See novonordisk.com. women, unchanged from 2018. business. Policies, actions and governance oversight are in place to prevent any un- Novo Nordisk takes a patient-centred ap- Through 2019 diversity and inclusion have wanted impacts and promote social progress proach in its care delivery model and learns been strategic and tactical priorities for through global access to healthcare, a safe, with patients. For additional information, Novo Nordisk. The launch of the Diversity healthy and inclusive working environment see the 'Our Business section' and Aspiration of achieving gender balance at with equal opportunities for all, business novonordisk.com. all managerial levels and the Diversity Ac- conduct with respect of others´ integrity and tion Plan with new guidelines and flexible human rights, and financial contributions to Employees working conditions have created direction communities where Novo Nordisk operates. Novo Nordisk aims to be an attractive towards becoming a more inclusive compa- employer that offers a safe and healthy, ny. Novo Nordisk acknowledges the impor- Patients inclusive and engaging working environ- tance of leadership role modelling inclusive Novo Nordisk is committed to driving ment in which all employees have equal behaviour to lead a sustainable work place change to defeat diabetes and other serious opportunities to realise their potential. where everyone is able to perform at their chronic diseases. To fulfil this purpose, Novo At the end of 2019, the total number of best. The strong stance on diversity and Nordisk pioneers scientific breakthroughs, employees was 43,258, corresponding to inclusion will continue in 2020 with focus expand access to our medicines, and work 42,703 full-time positions, which is a less on realising continuous impact from the to prevent and ultimately cure disease. than 1% increase compared with 2018. initiatives. The underlying growth in employees was In 2019, Novo Nordisk provided medical mainly driven by Region China. Employee Novo Nordisk is committed to ensuring treatment to an estimated 30.0 million peo- turnover decreased from 11.7% in 2018 to fair and equal treatment, opportunities – ple with diabetes worldwide, compared with 11.4%. and pay – for all employees regardless of 29.2 in 2018. This 3% increase was primar- gender. In 2019, we conducted a study on ily driven by sales of long-acting, premix and Novo Nordisk’s responsibility to respect la- gender and equal pay covering more than fast-acting insulins and GLP-1 products. bour rights applies to our global operations 50 countries and over 25,000 employees in as a global minimum standard of business order to reveal any differences in pay level Through Novo Nordisk’s Access to Insulin conduct. In 2019, the Global Labour Code or annual bonus due to gender. In a few Commitment, the company guarantees to of Conduct was revitalised and reinforced locations, we identified some differences provide low-priced human insulin to gov- to ensure alignment with Novo Nordisk’s that need to be further investigated, and ernments in the poorest parts of the world Business Ethics Compliance Framework, if due to gender, corrected. The equal pay and selected humanitarian organisations which includes respect of human rights. study will be repeated in 2020 to ensure a at a ceiling price of USD 4 per vial. As of The Code of Conduct describes expected continued focus. 2019, the guarantee is expanded to include global minimum labour rights requirements an additional 29 middle-income countries. for Novo Nordisk employees including the The average frequency rate of occupational This means that a total of 78 countries, as principles concerning fundamental rights in accidents with absence was 2.2 per million well as selected humanitarian organisa- the eight ILO Core Conventions and labour working hours in 2019 compared with tions, can benefit from this guarantee. An rights as stipulated in the International Bill 2.4 in 2018. In 2019, Novo Nordisk had estimated 2.9 million people were treated of Human Rights. Minimum paid maternity one work-related fatality compared with with insulin under this commitment in leave is increased from 12 to 14 weeks none in 2018. Novo Nordisk works with a 2019, of which approximately 200,000 globally and a right to paid paternity leave zero-injury mindset and remains com- people were reached through sales to is introduced. Moreover, guidance to avoid mitted to continuously improving safety humanitarian organisations. In 2019, the forced and bonded labour/child labour performance. Employees are encouraged average price the insulin was sold at equals and young workers is better described, the to always make the safe choice, and it is USD 0.12 per patient per day. Beyond this right to social security is affirmed, and life emphasised that safety behaviour is part of commitment, Novo Nordisk sold human insurance for all employees is introduced. the company values. insulin at or below the ceiling price in other For more information see countries, reaching an estimated additional novonordisk.com. Novo Nordisk Annual Report 2019 2.2 million people in 2019.

Introducing Novo Nordisk Our business Governance Consolidated statements 27 Responsible business see progress above. To mitigate risks of To create certainty regarding tax payments, Measures are taken to ensure that Novo exploitation and ensure respect for donors’ Novo Nordisk has applied for advance Nordisk conducts its business in a respon- right to free and informed consent among pricing agreements (APAs) in key countries. sible way, in accordance with the Novo others, we evaluated and delisted human The ambition is to have APAs covering Nordisk Way. biosample providers and reduced the ratio more than two-thirds of total sales. An of the unevaluated providers we use, from APA is an up-front agreement between the Business ethics, data privacy and 12% in 2018 to 6% in 2019. We have tax authorities in two or more countries, human rights also developed a risk-based global due covering the pricing methodologies for rel- In Novo Nordisk Business Ethics, Data Priva- diligence system. The Responsible Sourcing evant intercompany transactions, thereby cy and Human Rights is about acting with standards were updated in December 2019 determining the level of taxable income for integrity and in compliance with the Novo to strengthen its human rights coverage. the countries in question. An APA typically Nordisk Way, the Business Ethics Code of For our due diligence on modern slavery covers a future period of five tax years. Conduct as well as international and local risks, see Novo Nordisk’s Modern Slavery standards for responsible business conduct. Statement at novonordisk.com. Novo Nordisk has APAs in place covering intercompany transactions with the US, Training in Business Ethics is mandatory In 2019, a total of 236 supplier audits, un- Canada, Japan, India and China corre- and a high priority. Annual Business Ethics dertaken by Novo Nordisk's own organisa- sponding to more than 60% of total sales. training is required for all employees, includ- tion, were conducted to assess compliance Novo Nordisk's tax strategy is endorsed by ing new hires. Business Ethics training is levels with the company's standards for the Board of Directors. therefore a key element of the onboarding suppliers. Of these, 27 were responsible programmes. In 2019, 99% of all relevant sourcing audits and one critical finding was Long-term social targets employees completed and documented issued regarding working hours. An action Novo Nordisk has two long-term social their training. This high level is attributed to plan with deadlines has been agreed upon targets related to employee engagement the constant focus on and communication and a re-audit is planned for 2020. and trust. by senior management of the importance of business ethics compliance. In 2019, 34 Product quality The level of employee engagement and business ethics reviews were completed Novo Nordisk had four product recalls from commitment to the company’s values re- with 87 findings, compared with 33 re- the market in 2019, compared with three mains high. In the annual employee survey, views with 113 findings in 2018. Based on in 2018. As in 2018, none of the recalls conducted in the second quarter of 2019, the completed business ethics reviews, it is were critical. Local health authorities were 91% of employees responded positively to Group Internal Audit's assessment that the informed in all instances to ensure that dis- a set of questions to measure the level of business ethics compliance level is sound. tributors, pharmacies, doctors and patients engagement, same as in 2018. The target Management action plans and closure of received appropriate information. is at least 90%. findings progressed as planned, and there were no overdue Management actions or In 2019, as in 2018, there were no failed The level of trust in Novo Nordisk among findings at the end of the year. inspections by regulatory authorities key stakeholders - people with diabetes, among those resolved at year-end. In general practitioners and diabetes special- During 2019 Novo Nordisk developed and 2019, 66 inspections were conducted at ists - is an indicator of the extent to which approved its internal corporate require- Novo Nordisk’s sites, at clinics conducting the company lives up to stakeholders' ex- ments on Data Privacy and Human Rights investigations for Novo Nordisk or for pectations and the likelihood that they will which is operationalised in the Novo voluntary ISO 9001 certification, compared trust, support and engage with the com- Nordisk’s Business Ethics Code of Conduct. with 75 inspections in 2018. At year-end, pany. The company trust score, measured The requirements set out guidance and 44 inspections had been passed and 22 on a scale of 0-100, decreased to 78.2 expectations to all employees. Furthermore, were unresolved. Follow up on unresolved from 84.5 in 2018. The decline in trust can Data Privacy and Human Rights risks (‘risks inspection continues in 2020. best be explained by the increased scrutiny to people’) were integrated into the Busi- on pharma industry throughout 2019, in ness Ethics risk methodology, as the basis Responsible tax approach particular in regards to pricing, access and for risk management in the Novo Nordisk Novo Nordisk’s tax approach is to pursue affordability of medicines, which continues global organisation as of 2020. a competitive tax level in a responsible to be reflected in media sentiment and way. As a general rule, Novo Nordisk social media conversations. The decline in Progress was made in regard to manage- subsidiaries pay corporate taxes in the trust is not unique to Novo Nordisk, but is a ment of salient human rights issues beyond countries in which they operate and where trend across the pharma sector. Data were those already addressed by existing global business activity generates profits, earned collected between June and September standards and programmes. In 2019, for in accordance with international transfer 2019; a score between 70 and 80 is con- patient safety and the right to health, pricing rules. A competitive tax level implies sidered strong. The target is at least 80. we further increased the share of Novo achieving a tax level around the peer-group Nordisk subsidiaries providing access average. The company has a balanced tax Read more details in the 'Consolidated to safety reporting with local language risk profile and does not engage in tax social statement' and novonordisk.com. • directions on local websites, from 90% in avoidance activities. See 'Note 2.6 income 2018 to 96% in 2019. For availability and taxes and deferred income taxes' and 'Note Novo Nordisk Annual Report 2019 affordability aspects of the right to health, 9.8 total tax contribution'.

Introducing Novo Nordisk Our business Governance Consolidated statements 28 Waste Environmental performance Compared to 2018, waste decreased by 13% in 2019. This was due to a decreased amount of both ethanol waste and organic residues from the production of API in Kalundborg. Novo Nordisk has a bold and simple sure efficient production planning to reduce Overall, 93% of waste generated from ambition: to have zero environmental emissions from product distribution. production is recycled, used for biogas impact. To get there we are adopting a production or incinerated in waste-to-ener- circular mindset – designing products that Emissions from production remained stable gy plants. In 2019, 1% of total waste was can be recycled or re-used, reshaping our compared to 2018. At the end of 2019, the sent to landfill. business practice to minimise consumption conversion of Asnæs power plant in Kalund- and eliminate waste, and working with borg, Denmark was completed in collab- One strategic focus of the Circular for Zero suppliers who share our ambition. Our bold oration with the energy company, Ørsted. strategy is to investigate the end-of-life ambition is communicated through the This means that future heat and steam for challenge of devices following patient use, new Circular for Zero environmental strate- our largest production site will come from for the materials can be recovered and gy. We measure our progress based on use sustainable biomass instead of fossil fuels. recycled into new products. of resources, emissions and waste. With the use of bionatural gas and steam Long-term environmental targets Resources based on biomass in Denmark, as well In 2019, 76% of power for production sites In 2019, the energy consumption for op- as power from renewable sources across was sourced from renewable energy. In erations decreased slightly compared with global production sites, it is expected that 2019, Novo Nordisk finalised ana greement 2018. There is a continued focus on ener- more than 75% of the total energy use for in the United States to have solar energy gy-saving projects within production, and production sites will be based on renew- cover power consumption across all US op- projects implemented in 2019 are expected able sources in 2020. erations. This agreement is effective as of to result in annual savings of 72,000 GJ. 2020. With this solution, Novo Nordisk will Emissions from global offices and labs achieve its target to source 100% renew- Water consumption in production sites in decreased by 15,000 tons CO2 in 2019. As a able power at all production sites in 2020. 2019 increased slightly by 2% compared part of the new Circular for Zero strategy, all with 2018. Three facilities in Algeria, Brazil offices and labs will source renewable power In 2019, total emissions across operations and China are in areas with water stress by 2030. In 2019, there was a significant re- and transportation was 306,000 tons CO2. or high seasonal variability. These sites duction in CO2 emissions from the R&D site Emissions are expected to decrease signifi- accounted for 14% of the total water con- in Beijing, due to sourcing of wind power. cantly in 2020 due to various renewable sumption in 2019, and there is a continued energy projects, including solar power focus on reducing water consumption Emissions from company cars remained across all US operations, wind power in across these sites. stable at 62,000 tons CO2 in 2019. In order Europe and green steam in Denmark. Emis- to decrease emissions from company cars sions from transportation are also expected As part of the new Circular for Zero and encourage the global shift to electric to decrease due to a company car policy strategy, procurement is collaborating with vehicles, Novo Nordisk joined EV100 this that encourages transition to hybrid and suppliers to reduce environmental impact year. This partnership means that Novo electric vehicles and through collaboration across the value chain via a gradual shift to Nordisk commits to transitioning the entire with EV100, (The Climate Group's global sustainably sourced materials. fleet of approximately 8,000 vehicles to initiative for electrical vehicles). The target hybrid and electric vehicles by 2030. is to have zero emissions from operations Novo Nordisk is also working to ensure ex- and transportation by 2030 and it covers isting and new products are fit for circulari- Emissions from business flights are estimat- production sites, over 80 offices na d labo- ty, and, in 2019, a Circular Design Guideline ed to be 65,000 tons CO2 in 2019, a small ratories, company cars, business flights and was developed within R&D to reduce the increase compared to 2018. In 2019, Novo product distribution and was approved by environmental footprint of our devices. Nordisk invested in 55 new, larger video the Science Based Target Initiative. conferencing systems and five immersive Emissions video systems to enhance the conferencing Read more details in the 'Consolidated In 2019, total emissions across operations experience. In 2019, over 90 major events environmental statement' and novonordisk. and transportation were 306,000 tons CO2, were hosted from Livestream, including com. For a full breakdown of climate and which is a 10% increase compared to 2018, updates from Executive Management. water impacts please refer to the publicly primarily due to a significant increase in available Novo Nordisk CDP disclosures. emissions from product distribution. This was An ambitious circular supplier program, due to an increase in distributed volume, and 'Suppliers for Zero', was initiated as part of Details about Circular for Zero, including the fact that there was more air freight than the Circular for Zero strategy. Twelve key R&D developments and procurement can sea freight due to supply and market-driven suppliers have enrolled in 2019 of which be found on novonordisk.com. • challenges. In 2020, Novo Nordisk has focus four have committed to achieving zero CO2 Novo Nordisk Annual Report 2019 on ensuring a shift to sea freight and to en- emissions.

Introducing Novo Nordisk Our business Governance Consolidated statements 29 need to be tested for quality and reliabil- ity. If they do not work properly and give Managing risks to the correct guidance, they could present a health risk to the patients using our protect value products. Facing up to environmental risks Across all of these trends runs a growing and widely acknowledged concern for the global environment, particularly in relation to climate change. We are preparing for the risks and oppor- tunities which will arise from changing weather patterns, sea level rises and other climate impacts. As recommended by the Task Force on Climate-related Financial For Novo Nordisk to continue to be a sustainable business, we must Disclosures, we are integrating climate anticipate and adapt to changes in our markets to create new stra- change scenarios to identify short, medium and long-term risks within our production tegic opportunities. Managing the associated risks rigorously and and supply chain to ensure a steady supply systematically is key in order for us to create and protect value over of medicine to patients. the short, medium and long term. Rigorous and robust risk management A rigorous approach to enterprise risk man- agement helps our management protect Scenario and risk-thinking exercises Digital disruption and enhance the value of our tangible and are part of our strategic planning process. New digital technologies in healthcare are intangible assets. They include analyses of market dynamics offering more personalised treatment and as well as socioeconomic and political de- better management of chronic diseases. We are continually exposed to risks velopments that present risks or opportuni- This is an opportunity to deliver more value throughout our value chain – from early ties for our business. to our stakeholders and help patients live discovery of new, promising molecules to a life free from the limitations of their the production and delivery of medicines Balancing affordable care and disease. to patients. Some risks are inherent in the commercial value pharmaceutical industry, such as delays or In the short and medium term, we zoom in But the rise of digital healthcare brings failures of potential new medicines in the on trends in the healthcare ecosystem we risks of its own. New entrants and disrup- R&D pipeline. Other risks such as supply rely on. For example, in the diabetes care tive competitors, including large tech play- disruptions and competitive threats are market, payers continue to put pressure on ers as well as new start-ups, will be able well-known to any manufacturing com costs of insulin and are unwilling to pay a to leverage big data analytics to address pany with global production. premium for incremental innovation. some of the inefficiencies in the current healthcare systems. This will affect some We will never compromise on product For our business, the risks are reduced of our markets, and we will have to act to quality, patient safety and business ethics: profit from lower prices, and the damage avoid losing market share. these are front and centre of our enter- to brand trust could be significant if we were prise-wide risk management set-up. We seen to be profiteering from the situation. Artificial Intelligence (AI) and automation in apply a two-way lens and assess risks to the sector should make us more productive people as well as potential financial loss The US healthcare system’s structural chal- and speed up our time-to-market. Today, and reputational damage. lenges continue to be a risk to our business we are running several AI and automation as well. Affordable access to essential medi- pilots to accelerate innovation and harvest Executive Management and the Board cines is a big issue for the approximately five efficiency gains. Highly agile technolo- of Directors review a ‘heat map’ of our percent of Americans who are uninsured. gy sector companies could enter with biggest risks biannually. This map is based This will be front and centre in the 2020 disruptive approaches to health care. AI is on insights from management teams in all elections. Meanwhile, US market dynamics associated with issues such as unpredict- organisational areas and includes risks that are forging new healthcare alliances that ability of future uses. could cause significant disruptions to the affect negotiations between payers and business over a three-year horizon. There is providers of medicines. Access to afford- Moreover, new collaborations with per- a more detailed overview of our key risks in able care is not just an US issue. Globally, sonal healthcare players bring new risks the following overview. healthcare systems are struggling to provide – particularly around increased complexity, quality care at a sustainable cost, while the shared commercial arrangements and data Novo Nordisk Annual Report 2019 burden of chronic disease keeps rising. regulation. The personal healthcare apps

Introducing Novo Nordisk Our business Governance Consolidated statements 30 Novo Nordisk's key risks What is the risk? What is the impact? What actions are taken? Delays or failure of products in pipeline The development of a product candidate Patients would not benefit from innovative Insights into patients’ unmet needs inform can take more than 10 years and may be treatments and Novo Nordisk’s future posi- the selection of new product candidates. delayed, or even abandoned, at substantial tion as a leader could be jeopardised if we Clinical trials are run to demonstrate safety expense. The process involves non-clinical were unable to bring innovative products and efficacy. Assessments of commercial tests and clinical trials, commercial product to market. Any delays or failures of new viability determine progress through stage planning and regulatory approval, including products could have an adverse impact on gates. Consultations are held with regula- approval of production facilities. sales, profits and market position. tors to review clinical findings and obtain guidance on clinical programmes. Supply disruptions Failures or delays may occur at production If Novo Nordisk were prevented from Internal quality audits and annual inspec- sites or throughout the extensive global supplying products to markets, pharmacies tions by regulatory authorities document supply chain, relating to procurement of and hospitals could face product shortages, GMP compliance, and alternative supply ingredients and components as well as with potential implications for patients’ sites for critical raw materials and back-up distribution of products. This could be due daily treatment needs. facilities are in place for key production to breakdowns or quality failures at com- plants and safety inventories, to pre- pany sites or at key suppliers’ production vent and respond to accidents or other facilities. disruptions to supplies. Global production reduces supply risks. Competition and market developments Governments and private payers take Patients would not have access to the Clinical trial data demonstrate the added measures to limit spending on medicines clinical benefits of new products if Novo value of new products. Real-world evidence by driving down prices, demanding higher Nordisk were prevented from launching is introduced to show health economic rebates and restricting access to and new products due to reimbursement benefits. Negotiations with payers aim to reimbursement of new products. In some restrictions and newer products could be ensure patients’ access to the clinical bene- markets, political instability, conflict or niched for use in narrow sub-populations. fits of new products. weak enforcement of the rule of law may Across all markets, product categories affect sales. At any time, established or could face intensified competition and new competitors may bring new products in these categories lower realised prices to market or obtain label change for would be expected. marketed products, leading to increased competition. Compromises to product quality and patient safety Product quality and patient safety may be Patients’ health and lives could be put at A robust quality management system, compromised if, for example, a production risk and Novo Nordisk’s reputation and improvement plans and systematic senior facility is found to be in noncompliance, a licence to operate could be damaged if management reviews are in place. Author- product is not within specifications, or if regulatory compliance is not ensured. ity inspections and internal quality audits side effects that were not detected in clini- are conducted at production sites. When cal trials become apparent when a product issues are found within the production pro- is used for a longer period of time. cess of clinical or marketed products, root causes are identified and corrected and, if necessary, products are recalled. Novo Nordisk Annual Report 2019

Introducing Novo Nordisk Our business Governance Consolidated statements 31 What is the risk? What is the impact? What actions are taken? IT security breaches Disruption to IT systems, such as virus Patients’ or other individuals’ privacy could IT security technologies and controls are attacks, and breaches of data security, be compromised if confidential information in place to help prevent intruders from may happen across the global value chain, were disclosed, and breaches of IT security causing damage to systems and gaining where reliable IT systems and infrastruc- could have a severe impact on Novo Nor- access to critical data and systems. Con- ture are critical for the company’s ability to disk’s ability to maintain operations and tinuity plans are in place in the event of operate effectively. hence on its financial situation. In produc- non-availability of IT systems. Awareness tion environments, for example, breaches campaigns, access controls and intrusion of IT security could impact Novo Nordisk’s detection and prevention systems have ability to produce and safeguard product been implemented. Company-wide internal quality. audits of IT security controls are conducted to detect and mitigate any breaches. Currency impact and tax disputes Exchange rate fluctuations, disputes Novo Nordisk’s cash flow, statement of Expected future cash flows for selected with tax authorities and changes to tax comprehensive income and balance sheet currencies are hedged to mitigate short- legislation are external factors. Novo can be impacted significantly by currency term impact on earnings and cash flow. An Nordisk’s foreign exchange risk is most fluctuations. Changes to tax legislation or integrated treasury management system significant in USD, CNY and JPY, while the loss of major tax cases could result in signif- is in place. Applicable taxes are paid in EUR exchange rate risk is regarded as low icant tax adjustments and fines, and could jurisdictions where business activity gen- due to Denmark’s fixed-rate policy towards lead to a higher-than-expected tax level for erates profits. Multi-year advance pricing EUR. the company. agreements with tax authorities have been negotiated for more than 60% of our sales in the US, China and Japan. Hedging activ- ities and calculation of transfer pricing are subject to internal controls and audit. Breach of legislation or ethical standards In a tightly regulated industry, breach of Breaches of legislation or ethical standards Compliance programmes address ad- legislation, industry codes or company could compromise the integrity, dignity and herence, such as the Business Ethics policies may occur in connection with rights of the individuals involved and could Compliance Framework, supported by business interactions, such as with health- cause damage to Novo Nordisk’s reputation due diligence, standard procedures and care professionals, business partners or and financial situation and could expose training to ensure compliance with laws, other stakeholders. Operations in complex Novo Nordisk to investigations, criminal international standards and regulations socioeconomic and cultural contexts could and civil sanctions and other penalties. and prevent breaches of standards, with present risks of non-compliance with legal defence where relevant. Compliance Business Ethics standards including human with business ethics standards is subject to rights and personal data protection. internal audit. Action is taken immediately on substantiated non-compliance. Loss of intellectual property rights The validity of patents that are critical for Loss of exclusivity for existing and pipeline Throughout the process of drafting, filing protecting Novo Nordisk’s commercial products could impact Novo Nordisk’s and prosecuting a patent application, products and candidates in the R&D pipe- market position, sales and profits. internal controls are in place to minimise line may be challenged by competitors. vulnerability to invalidity actions. Patents at high risk of invalidity challenge are proac- tively identified to defend Novo Nordisk’s intellectual property rights. Novo Nordisk Annual Report 2019

Introducing Novo Nordisk Our business Governance Consolidated statements 32 the free float of listed B shares was 90.1% (of which approximately 11.9% are listed Shares and capital as ADRs), excluding the Novo Holdings A/S holding and Novo Nordisk’s holding of structure treasury shares which, as of 31 December 2019, was DKK 36,780,840 nominally. For details about the share capital, see note 4.1. Capital structure and dividend policy Novo Nordisk’s Board of Directors and Executive Management consider that the current capital and share structure of Novo Nordisk serves the interests of the share- holders and the company well, providing the strategic flexibility to pursue Novo Nordisk’s vision. Novo Nordisk’s capital structure strategy offers a good balance between long-term shareholder value cre- ation and competitive shareholder return in the short term. Novo Nordisk’s guiding Through open and proactive communication, the company aims to principle is that, after the funding of provide the basis for fair and efficient pricing of its shares. organic growth opportunities, investments and acquisitions, any excess capital should be returned to investors. The company’s dividend policy applies a pharmaceutical in- Share capital and ownership However, in practice, A shares and B shares dustry benchmark to ensure a competitive Novo Nordisk’s total share capital of DKK receive the same amount of dividend per payout ratio for dividend payments, which 480,000,000 is divided into an A share share. As of 31 December 2019, Novo are complemented by share repurchase capital of nominally DKK 107,487,200 Holdings A/S also held a B share capital of programmes. The final dividend for 2018 and a B share capital of nominally DKK nominally DKK 27,152,800. Novo Holding paid in March 2019 was equal to DKK 5.15 372,512,800. Novo Nordisk’s B shares A/S's total ownership is reflected in the per A and B share of DKK 0.20 as well are listed on Nasdaq Copenhagen and on following chart of ownership structure. as for ADRs. The total dividend for 2018 the New York Stock Exchange (NYSE) as was thus DKK 8.15 per A and B share of American Depository Receipts (ADRs). Novo There is no complete record of all share- DKK 0.20, corresponding to a payout ratio Nordisk’s A and B shares are calculated in holders; however, based on available of 50.6%, which is in line with the 2018 units of DKK 0.20, resulting in 537 million sources of information about the company’s pharma peer group average of 49.4%. In A shares and 1,863 million B shares. Each shareholders, as of 31 December 2019 it is August 2019, an interim dividend was paid A share carries 200 votes and each B share estimated that shares were geographically equalling DKK 3.00 per A and B share of carries 20 votes. distributed as shown in the chart 'Geo- DKK 0.20 as well as for ADRs. For 2019, graphical split'. As of 31 December 2019, the Board of Directors will propose a The company’s A shares are not listed and are held by Novo Holdings A/S, a Danish public limited liability company wholly ��ners�ip stru�ture owned by the Novo Nordisk Foundation. The Foundation has a dual objective: to provide a stable basis for the commercial Novo Nordisk Foundation and research activities conducted by the Institutional and private investors companies within the Novo Group (of which Novo Nordisk A/S is the largest), Novo Holdings A/S and to support scientific and humanitarian purposes. According to the Articles of 76.1% of votes 23.9% of votes Association of the Foundation, the A shares 28.1% of capital 71.9% of capital cannot be divested. Special rights attached to A shares include pre-emptive subscrip- tion rights in the event of an increase in the A shares B shares A share capital and pre-emptive purchase 537 million shares 1,863 million shares rights in the event of a sale of A shares, while B shares take priority for liquidation proceedings. A shares take priority for Novo Nordisk A/S dividends below 0.5%, and B shares take Novo Nordisk Annual Report 2019 priority for dividends between 0.5 and 5%. Note� Treasury shares are included, however, voting rights of treasury shares cannot be exercised

Introducing Novo Nordisk Our business Governance Consolidated statements 33 final dividend of DKK 5.35 to be paid in �eo�rap�ial split* March 2020, equivalent to a total dividend % of share capital 2019 2018 for 2019 of DKK 8.35 and a payout ratio of % 50.5%. The company expects to distribute an interim dividend in August 2020, and 50 further information regarding such interim dividend will be announced in connection 40 with the financial report for the first six months of 2020. Dividends are paid from 30 distributable reserves. Share premium is a distributable reserve and any former share premium reserve has been fully distributed. 20 Novo Nordisk does not pay a dividend on its holding of treasury shares. 10 Share repurchase programme for 0 2019/2020 Denmark North America UK and Ireland Other During the twelve-month period beginning *Using shareholder registered home countries 1 February 2019, Novo Nordisk repur- chased shares worth DKK 15 billion. The share repurchase programme has primarily been conducted in accordance with the �as� distri�ution to s�are�olders safe harbour rules in the EU Market Abuse Dividend for prior year Interim dividend Share repurchases in the calendar year Free cash ﬂow Regulation (MAR). For the next 12 months, Novo Nordisk has decided to implement a new share repurchase programme. DKK billion The expected total repurchase value of B 40 shares amounts to a cash value of up to DKK 17 billion. The total programme may be reduced in size if significant product 30 in-licensing or bolt-on acquisition oppor- tunities arise during 2020. Novo Nordisk 20 expects to conduct the majority of the new share repurchase programme according to the safe harbour rules in MAR. At the 10 Annual General Meeting in March 2020, the Board of Directors will propose a further reduction in the company’s B share 0 2016 2017 2018 2019 2020E capital, corresponding to approximately 2% of the total share capital, by cancel- ling 50,000,000 treasury shares. After the implementation of the share capital ��are pri�e per�or�an�e 2019 reduction, Novo Nordisk’s share capital will Novo Nordisk share price and indexed peers1 amount to DKK 470,000,000 divided into Novo Nordisk Pharmaceutical industry index* OMXC25 A share capital of DKK 107,487,200 and B share capital of DKK 362,512,800. DKK 400 Share price development Novo Nordisk’s share price increased by 360 29.8% between its 2018 close of DKK 297.9 and the 31 December 2019 close 320 of DKK 386.65. For comparison purposes, the Danish OMXC25 stock index increased 280 by 26% and the pharma peer group increased by 13% during 2019. The total 240 market value of Novo Nordisk’s A and B shares, excluding treasury shares, was 200 DKK 909,178,012,657 as of 31 December Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec 2019. • *Pharmaceuticals index comprises: AstraZeneca, Bristol-Myers Squibb, Eli Lilly, GlaxoSmithKline, Johnson & Johnson, Merck, Novartis, Pﬁzer, Roche, Sanoﬁ and Novo Nordisk 1. OMX C25 and pharmaceutical industry development have been rebased to Novo Nordisk share price in January 2019 Novo Nordisk Annual Report 2019

Introducing Novo Nordisk Our business Governance Consolidated statements 34 implementation, the performance, ensures Corporate adequate management and organisation and, as such, actively contributes to devel- oping the company as a focused, sustain- governance able, global pharmaceutical company. The Board of Directors may also distribute extraordinary dividends, issue new shares or repurchase shares in accordance with authorisations granted by the sharehold- ers at the Annual General Meeting and recorded in the meeting minutes available The Board of Directors of Novo Nordisk focuses on good gover- at novonordisk.com/about_us. nance practices. In 2019, one new board member was appointed at Shareholder-elected board members serve the Annual General Meeting. Two members of Executive Manage- for a one-year term and may be re-elected. ment left Novo Nordisk after more than 20 years with the company Board members must retire at the first An- and two new members of Executive Management were appointed. nual General Meeting after reaching the age of 70. One board member is a member of the Board of Directors of Novo Holdings A/S, and one board member is chief executive officer of Novo Holdings A/S and may be Governance structure Novo Holdings A/S holds the majority regarded as representing the interests of the of votes at general meetings. However, controlling shareholder, while seven of the Shareholders all strategic and operational matters are nine shareholder-elected board members The shareholders of Novo Nordisk have decided solely by the Board of Directors are independent as defined by the Danish ultimate authority over the company and and Executive Management. Read more Corporate Governance Recommendations. exercise their right to make decisions at about the ownership structure of Novo general meetings. At the Annual Gen- Nordisk in 'Shares and capital structure'. Under Danish law, employees in Denmark eral Meeting, shareholders approve the may elect a number of board members annual report and any amendments to Board of Directors equalling half of the shareholder-elected the company’s Articles of Association. Novo Nordisk has a two-tier management board members. Board members elected by Shareholders also elect board members and structure consisting of the Board of Direc- employees serve for a statutory four-year the independent auditor. Resolutions can tors and Executive Management. The two term and have the same rights, duties generally be passed by a simple majority. bodies are separate, and no one serves as a and responsibilities as shareholder-elected However, resolutions to amend the Articles member of both. board members. The employee-elected of Association require two-thirds of the board members are up for election again votes cast and capital represented, unless The Board of Directors supervises Executive in 2022. Read more about the members of other adoption requirements are imposed Management, determines the company’s the Board of Directors and at novonordisk. by the Danish Companies Act. overall strategy and follows up on its com/about_us. �orporate �overnan�e �odes and pra�ti�es �o�plian�e �overnan�e stru�ture Assuran�e Audit of ﬁnancial data Danish and foreign ��are�olders and review of social and laws and regulations environmental data (internal and external) �oard o� �ire�tors ��air�ans�ip� Audit No�ination Re�uneration R�� Corporate governance �o��ittee �o��ittee �o��ittee �o��ittee Facilitation (internal) standards ��e�utive �ana�e�ent Quality audit and inspections Novo Nordisk Way �r�anisation (internal and external) * The Chairmanship is directly elected by the Annual General Meeting. Novo Nordisk Annual Report 2019

Introducing Novo Nordisk Our business Governance Consolidated statements 35 As of 31 December 2019, the Board of utive succession, board composition and meetings. At the Annual General Meeting Directors consisted of 13 members, nine of succession, potential over-boarding and in 2019, Helge Lund was re-elected as chair whom were elected by shareholders and training as well as the performance of the and Jeppe Christiansen was re-elected as four of whom were elected by employees Chairmanship and the board committees. vice chair. The Chairmanship assists the based in Denmark. The Board of Directors In addition, each member of the Board Board of Directors in the planning of Board met eight times during 2019. At the of Directors and Executive Management meetings, employment of Executive Man- Annual General Meeting in March 2019, is provided with feedback from all other agement and other assignments as decided Laurence Debroux was elected as new board members and executives on their by the Board. member of the Board of Directors. individual performance. In 2019, the Chairmanship particularly Nomination, self-evaluation and In 2019, the Board evaluation was facili- discussed commercial execution within diversity tated internally and, in general, revealed the therapy areas and in different mar- A proposal for election or re-election of good performance by the Board and kets, partnering and acquisition to access shareholder-elected board members is good collaboration between the Board external innovation as well as talent and presented by the Nomination Committee and Executive Management. The process leadership development, supervising the to the Board of Directors. When recom- also resulted in continued focus on the changes in Executive Management and mending candidates to be nominated by implementation of the R&D strategy, on development of the company culture. the Board, the Nomination Committee commercial execution and on being a considers factors such as the balance sustainable company. Audit Committee between renewal and continuity, the The Audit Committee assists the Board desired competences and experience, the To ensure that discussions include multiple of Directors with oversight of the exter- performance of the individual Board mem- perspectives representing the complex, nal auditors, the internal audit function, bers, the ambition for diversity as well as global pharmaceutical environment, the handling hotline complaints, financial, independence considerations. Board of Directors aspires to be diverse in social and environmental reporting, gender and nationality. business ethics compliance, information To support continued fulfilment of the security, insurance coverage, special theme Novo Nordisk Way, in the Board com- In 2016, the Board of Directors adjusted its reviews and other tasks on an ad hoc basis, petence profile the Board of Directors diversity ambition and set new targets with as specifically decided by the Board. All has determined that the Board members the aim of consisting, by 2020, of at least members have relevant industry expertise. should possess integrity, accountability, two shareholder-elected board members For independence see table on meeting fairness, financial literacy, commitment with Nordic nationality and at least two participation in 2019. and desire for innovation. Additionally, the shareholder-elected board members with a following competences and experience nationality other than Nordic – and at least The Audit Committee is appointed by the should be represented on the Board: global three shareholder-elected board members Board and consists of: business management, strategic operations of each gender. and governance, healthcare industry and • Liz Hewitt (chair; financial expert) market access, research and development, As of 31 December 2019, three • Laurence Debroux (financial expert) technology and digitalisation, M&A and shareholder- elected board members were • Andreas Fibig external innovation sourcing, people lead- female and six were male, while seven • Sylvie Grégoire ership and change management as well as of the nine shareholder-elected board • Stig Strøbæk finance and accounting, cf. the biographies members were non-Nordic and two were of Board members in the overview 'Board Nordic. The company thus fulfilled its In 2019, the Audit Committee focused of Directors'. The competence profile, nationality ambition and its gender ambi- particularly on reviewing and discussing which includes the nomination criteria, is tion. The Board of Directors will revisit its work performed by internal and external available at novonordisk.com/about_us. diversity ambition in 2020 and, if needed, auditors and held focused sessions on risks adjust the numbers and parameters which and internal controls in key areas such as The Board of Directors conducts a self-eval- are currently fulfilled. North America Operations, Product Supply uation every year. The self-evaluation and International Operations. The Audit includes all members of the Board and Ex- In accordance with section 99b of the Committee also discussed key accounting ecutive Management. The chair has overall Danish Financial Statements Act, Novo policies and estimates, including provi- responsibility for conducting the self-eval- Nordisk discloses current performance sions for sales rebates, indirect production uation. The self-evaluation is facilitated on diversity in the 'Social performance' costs and ongoing tax and legal cases. every third year by external consultants, section. Novo Nordisk’s diversity policy is The Audit Committee also reviewed and who interview all members of the Board of available at novonordisk.com. discussed the status of Information Security Directors and Executive Management. For and Business Ethics Compliance within the subsequent two years, the self-evalu- Board committees Novo Nordisk. Finally, the Audit Committee ation is facilitated by the secretary of the recommended a preferred external auditor Nomination Committee based on written Chairmanship which is to be selected by the Annual Gen- questionnaires. The process evaluates topics The Chairmanship consists of the chair and eral Meeting in 2021. such as board dynamics, board agenda the vice chair, both of whom are elected Novo Nordisk Annual Report 2019 and discussions, strategy, culture, exec- directly by the shareholders at the general

Introducing Novo Nordisk Our business Governance Consolidated statements 36 Nomination Committee The Research & Development Committee is The three executives who are based outside The Nomination Committee assists the appointed by the Board and consists of: Denmark and who have responsibility for Board with oversight of the competence Biopharm, International Operations and profile and composition of the Board, nom- • Martin Mackay (chair) North America Operations, respectively, ination of members and committees, the • Brian Daniels are not registered as executives with the corporate governance of the company and • Sylvie Grégoire Danish Business Authority. other tasks on an ad hoc basis, as specifi- • Thomas Rantzau cally decided by the Board. In 2019, the Research & Development Remuneration The Nomination Committee is appointed Committee focused particularly on by the Board and consists of: reviewing the results of clinical trials and Novo Nordisk’s Remuneration Principles discussed potential additional research and provide the framework for the remuner- • Helge Lund (chair) development activities to further explore ation of the Board and Executive Man- • Sylvie Grégoire opportunities within subcutaneous and oral agement. The Remuneration Principles • Kasim Kutay GLP-1 as well as competitor initiatives. In were most recently changed in March • Mette Bøjer Jensen addition, the committee discussed the po- 2019, where the Annual General Meeting tential opportunities for addressing unmet approved amendments in order to reflect In 2019, the Nomination Committee needs in NASH. It also reviewed potential the fact that the Research & Development focused particularly on reviewing the com- external research collaborations as well as Committee had become a permanent position of the Board and considered long- acquisitions. Board committee and in order to ensure term succession planning. It also reviewed that Novo Nordisk is able to reclaim the desired competences to be represented See the Corporate Governance Report or incorrect pay-outs of incentives based on a on the Board. novonordisk.com/about_us for a more de- misstatement of data regardless of whether tailed description of the Board committees, this originates due to wilful misconduct or Remuneration Committee their charters, details on members and full gross negligence. Moreover, the Annual The Remuneration Committee assists the reports on the Board committees’ activities General Meeting approved the denomi- Board with oversight of the remuneration in 2019. nation of travel allowance in DKK instead policy as well as the actual remuneration of EUR. These principles are available at of board members, Board committees and Executive Management novonordisk.com/about-novo-nordisk/cor- Executive Management. Executive Management is responsible porate-governance/remuneration.html. for overall day-to-day management, the The Remuneration Committee is appointed organisation of the company, allocation of Novo Nordisk has prepared a separate by the Board and consists of: resources, determination and implemen- Remuneration Report that describes the tation of strategies and policies, direction remuneration awarded or due during 2019 • Jeppe Christiansen (chair) setting, and ensuring timely reporting and to the members of the Board and the Exec- • Brian Daniels provision of information to the Board of utive Management of Novo Nordisk A/S as • Liz Hewitt Directors and Novo Nordisk’s stakeholders. registered with the Danish Business Author- • Anne Marie Kverneland Executive Management meets at least once ity. This report also includes a description of a month. The Board of Directors appoints key developments in remuneration in 2019, In 2019, the Remuneration Committee fo- members of Executive Management and the actual remuneration of board members cused particularly on conducting a general determines their remuneration. The Chair- and executives, an overview of remuner- review of executive remuneration, includ- manship reviews the performance of the ation awarded during the previous five ing proposing changes to the base salary, executives. financial years, remuneration benchmarks the pension, the short-term cash-based and shareholdings by board members and incentive programme, the long-term share- To ensure the organisational implementa- executives. The Remuneration Report is based incentive programme, the sharehold- tion of the strategy, Executive Management available at: novonordisk.com/about-no- ing requirement, etc., and on developing of has established a Management Board vo-nordisk/corporate-governance/remuner- a new Remuneration Policy to be approved consisting of the chief executive officer, ation.html. by the Annual General Meeting and a new executive vice presidents and senior vice separate Remuneration Report to be pre- presidents. Read �ore in t�e Re�uneration report sented to the Annual General Meeting. As of 31 December 2019, Executive Research & Development Committee Management consisted of nine members The Research & Development Committee including the chief executive officer. As of Assurance assists the Board with oversight of the April 2019, Jesper Brandgaard retired from research and development strategy, the Novo Nordisk and Ludovic Helfgott was The company’s financial reporting and pipeline, the R&D organisation and other appointed executive vice president, head of the internal controls of financial reporting tasks on an ad hoc basis, as specifically Biopharm. As of August 2019, Lars Green processes are audited by an independent decided by the Board. resigned from Novo Nordisk and Monique audit firm elected at the Annual General Carter was appointed executive vice presi- Meeting. As part of Novo Nordisk’s com- Novo Nordisk Annual Report 2019 dent, head of People & Organisation. mitment to its social and environmental

Introducing Novo Nordisk Our business Governance Consolidated statements 37 responsibility, the company voluntarily ment and recommending candidates Disclosure regarding change includes an assurance report for social for the Executive Management re- of control and environmental reporting in the annual sides with the Chairmanship and not report. The assurance provider reviews with the Nomination Committee. The EU Takeover Bids Directive, as partially whether the social and environmental per- implemented by the Danish Financial State- formance information covers aspects that 3.4.7 Tasks of the Remuneration Commit- ments Act, requires listed companies to are deemed to be material and verifies the tee: responsibility for the remunera- disclose information that may be of interest internal control processes for the informa- tion policy applicable to employees to the market and potential take-over bid- tion reported. in general resides with Executive ders, in particular in relation to disclosure Management and not with the Re- of change-of-control provisions. Novo Nordisk’s internal audit function muneration Committee. provides independent and objective assur- Novo Nordisk discloses that the Group has ance, primarily within internal control of 4.1.5 Termination payments: one executive one significant agreement with a US payer financial processes, IT security and business employment contract entered into which takes effect, alters or terminates ethics. To ensure that the internal financial before 2008 allow for severance pay- upon a change of control of the Group. If audit function operates independently of ments of more than 24 months’ fixed effected, a takeover could – at the discre- Executive Management, its charter, audit base salary plus pension contribu- tion of the relevant counterparty – lead to plan and budget are approved by the Audit tion, and thus the total value of the the termination of such agreement. Given Committee. The Audit Committee must remuneration relating to the notice the ownership structure of Novo Nordisk, approve the appointment, remuneration period and of the severance payment the risk is considered to be remote. and dismissal of the head of the internal exceeds two years of remuneration. audit function. In relation to Executive Management, Novo Nordisk complies with the corporate the current employment contracts allow Other types of assurance activity – quality governance standards of NYSE applicable severance payments of up to 36 months' audits and values audits, known as facili- to foreign listed private issuers. A summa- fixed base salary plus pension contributions tations – help to ensure that the company ry of the significant ways in which Novo in the event of a merger, acquisition or adheres to high quality standards and op- Nordisk’s corporate governance practices takeover of Novo Nordisk. erates in accordance with the Novo Nordisk differ from the NYSE corporate governance Way. Read more about the Novo Nordisk listing standards can be found in the Statu- For information about the ownership Way in 'Leading a sustainable business'. tory Corporate Governance Report. structure of Novo Nordisk, see 'Shares and capital structure'. The Statutory Corporate Governance Compliance with corporate Report, in accordance with section 107b governance codes of the Danish Financial Statements Act, the applicable corporate governance codes Novo Nordisk’s B shares are listed on for each stock exchange and an overview Nasdaq Copenhagen and on the New York of Novo Nordisk’s compliance with and Stock Exchange (NYSE) as American Depos- explanations for all applicable Nasdaq and itory Receipts (ADRs). NYSE Corporate Governance recommenda- tions, are all available at novonordisk.com/ Today, Novo Nordisk adheres to all Danish about-novo-nordisk/corporate-governance/ Corporate Governance Recommendations Recommendations-and-practices.html designated by Nasdaq Copenhagen except the following five recommendations: Read �ore in t�e �orporate �overnan�e report 3.3.2 Disclosure of additional information about the Board members: informa- tion on matters such as numbers of shares owned and changes during the year is disclosed in the Remuner- ation Report for 2019 and not in the management commentary. 3.4.2 Independence of Board committees: the majority of the members of the Nomination Committee and the Remuneration Committee are not independent. 3.4.6 Tasks of the Nomination Committee: Novo Nordisk Annual Report 2019 responsibility for succession manage-

Introducing Novo Nordisk Our business Governance Consolidated statements 38 Board of Directors Helge Lund — Chair Laurence Debroux Chair of the Board of Novo Nordisk A/S since 2018 Member of the Board of Novo Nordisk A/S and member of (member for one year in 2014-2015 and again in 2017) and the Audit Committee since 2019. chair of the Nomination Committee since 2018 (member Positions and management duties: Group chief financial since 2017). officer, executive board member, of Heineken N.V., the Position and management duties: Operating advisor to Netherlands. Member of the board of Exor N.V., the Nether- Clayton Dubilier & Rice, US. Chair of the Board of BP p.l.c., lands, and of HEC Paris Business School, France. UK. Member of the boards of P/F Tjaldur, Faroe Islands, Special competences: Significant financial and accounting Inkerman Holding AS, Norway, and Belron SA, Luxembourg. experience, extensive global experience within the pharma- Member of the Board of Trustees of the International Crisis ceutical industry and experience from executive positions in Group. major international companies. Special competences: Extensive executive and board Education: Master Degree from HEC Paris, Ecoles des experience in large multinational companies and significant Hautes Etudes Commerciales, France (1992). financial knowledge. Education: MBA from INSEAD, France (1991) and MA in Economics from the Norwegian School of Economics & Andreas Fibig Business Administration (NHH), Norway (1987). Member of the Board of Novo Nordisk A/S and member of the Audit Committee since 2018. Position and management duties: Chair and chief exec- Jeppe Christiansen — Vice chair utive officer of International Flavors & Fragrances Inc., US, Vice chair and member of the Board of Novo Nordisk A/S Chair of the Board of the German American Chamber of since 2013. Chair of the Remuneration Committee since Commerce, and Executive Committee member of the World 2017 (member since 2015). Business Council for Sustainable Development (WBCSD). Positions and management duties: Chief executive Special competences: Extensive global experience within officer of Maj Invest Holding A/S as well as board member biopharmaceutical companies, in-depth knowledge of strat- and/or executive director in three wholly owned subsidiaries egy, sales and marketing and knowledge about how large of this company, all in Denmark. Chair of Haldor Topsøe A/S international companies operate. and Emlika ApS and board member of a wholly owned sub- Education: Degree in Marketing from Berlin School of sidiary of this company and of the boards of Novo Holdings Economics, Germany (1982). A/S and KIRKBI A/S, all in Denmark. Member of the Board of Governors of Det Kgl. Vajsenhus, Denmark. Adjunct Professor, Department of Finance, Copenhagen Business Sylvie Grégoire School, Denmark. Member of the Board of Novo Nordisk A/S and of the Special competences: Executive background and extensive Audit Committee since 2015, member of the Research & experience within the financial sector, in particular in rela- Development Committee since 2017, and member of the tion to financial and capital market issues as well as insight Nomination Committee since 2018. into the investor perspective. Positions and management duties: Chair of the board of Education: MSc in Economics from University of Corvidia Therapeutics Inc., executive chair of the board of Copenhagen, Denmark (1985). EIP Pharma, Inc., and member of the board of Perkin Elmer Inc., all in the US. Special competences: Deep knowledge of the regulatory Brian Daniels environment in both the US and the EU, with experience Member of the Board of Novo Nordisk A/S since 2016, of all phases of the product life cycle, including discovery, member of the Remuneration Committee since 2018 and registration, pre-launch and managing the life cycle while member of the Research & Development Committee since on the market. She also has financial insight, including into 2017. P&L responsibility. Position and management duties: Partner with 5AM Education: Pharmacy Doctorate degree from the State Venture Management, LLC, and member of the board at University of NY at Buffalo, US (1986), BA in Pharmacy from Caballeta Bio Inc., both in the US. Laval University, Canada (1984), and Science College degree Special competences: Extensive experience in clinical from Séminaire de Sherbrooke, Canada (1980). development, medical affairs and corporate strategy across a broad range of therapeutics areas within the pharmaceutical industry, especially in the US. Education: MD from Washington University, St. Louis, US (1987), and MA in Metabolism and Nutritional Biochemistry (1981) and BSc in Life Sciences (1981), both from Massa- chusetts Institute of Technology, Cambridge, US. Competences and experience to be represented on the Board (shareholder-elected Board members only) Global business Healthcare industry Research and M&A and external People leadership and Finance and management, strategic and market access development, technol- innovation sourcing change management accounting operations and gov- ogy and digitalisation ernance Novo Nordisk Annual Report 2019 Read more on competences and experience to be represented on the Board under “Nomination” in the Corporate Governance article.

Introducing Novo Nordisk Our business Governance Consolidated statements 39 Liz Hewitt Anne Marie Kverneland Member of the Board of Novo Nordisk A/S since 2012, chair Member of the Board of Novo Nordisk A/S since 2000 of the Audit Committee since 2015 (member since 2012) (employee representative) and member of the Remuneration and member of the Remuneration Committee since 2018. Committee since 2017. Position and management duties: Member of the board Positions and management duties: Laboratory technician of Melrose Industries plc, UK, where she chairs the audit and full-time union representative in Novo Nordisk A/S. committee, and member of the board of National Grid plc, Member of the Board of Directors of the Novo Nordisk UK. External member of the House of Lords Commission, Foundation since 2014. UK, where she chairs the audit committee. Education: Degree in medical laboratory technology from Special competences: Extensive experience within the the Copenhagen University Hospital, Denmark (1980). field of medical devices, significant financial knowledge, including mergers and acquisitions, and knowledge about how large international companies operate. Martin Mackay Education: FCA (UK Institute of Chartered Accountants) Member of the Board of Novo Nordisk A/S and chair of the (1982), and BSc (Econ Hons) from the University College in Research & Development Committee since 2018. London, UK (1977). Positions and management duties: Co-founded Rallybio LLC, US, in January 2018 and serves as chair of the Board of the company and in an executive leadership role overseeing Mette Bøjer Jensen all research and non-research functions. Senior advisor to Member of the Board of Novo Nordisk A/S (employee New Leaf Venture Partners, LLC, US. Member of the board representative) and member of the Nomination Committee and chairs the Science and Technology Committee of since 2018. Charles River Laboratories International, Inc., US. Position and management duties: Wash & Sterilisation Special competences: R&D executive with extensive expe- Specialist in Product Supply, Novo Nordisk A/S. rience in building a pipeline, acquiring products and man- Education: Graduate Programme (HD) in Business Admin- aging the portfolio of early-stage and late-stage projects in istration (Strategic management and business development) large international pharmaceutical companies. from Copenhagen Business School, Denmark (2010), and Education: Doctorate/PhD from University of Edinburgh, MSc in Biotechnology, Aalborg University, Denmark (2001). UK (1984), and BSc (First Class Honours) in Microbiology from Heriot-Watt University, Edinburgh, UK (1979). Kasim Kutay Member of the Board of Novo Nordisk A/S and member of Thomas Rantzau the Nomination Committee since 2017. Member of the Board of Novo Nordisk A/S (employee Positions and management duties: Chief executive representative) and member of the Research & Development officer of Novo Holdings A/S, Denmark. Member of the Committee since 2018. board of Novozymes A/S, Denmark, and of the Life Sciences Positions and management duties: Area specialist in Advisory Board of Gimv NV, Belgium. Product Supply, Novo Nordisk A/S. Special competences: Extensive experience as financial Education: Degree in food engineering from DTU, advisor to the pharmaceutical, biotechnology and medical Denmark (2003) and diploma as dairy technician (1992). device industries. Mr Kutay has also advised healthcare companies on an international basis including companies based in Europe, the US, Japan and India. Stig Strøbæk Education: MSc in Economics (1987), and BSc in Economics Member of the Board of Novo Nordisk A/S since 1998 (1986), both from the London School of Economics, UK. (employee representative) and member of the Audit Committee since 2013. Positions and management duties: Electrician and a full-time union representative in Novo Nordisk A/S. Education: Diploma in further training for board members from the Danish Employees’ Capital Pension Fund (LD) (2003), and diploma in electrical engineering (1984). Meeting participation in 20191 Board of Chairman- Audit Remuneration Nomination R&D Name (male/female) First elected Term Nationality Born Independence2 Directors ship Committee Committee Committee Committee Helge Lund (m) 20173 2020 Norwegian Oct. 1962 Independent 8/8 8/8 3/3 Jeppe Christiansen (m) 2013 2020 Danish Nov. 1959 Not independent 4 8/8 6/8 5/5 Laurence Debroux (f) 2019 2020 French Jul. 1969 Independent 6/6 3/3 Brian Daniels (m) 2016 2020 American Feb. 1959 Independent 8/8 5/5 6/6 Andreas Fibig (m) 2018 2020 German Feb. 1962 Independent 5, 6 8/8 2/4 Sylvie Grégoire (f) 2015 2020 Canadian/American Nov. 1961 Independent 5, 6 7/8 4/4 3/3 6/6 Liz Hewitt (f) 2012 2020 British Nov. 1956 Independent 5, 6 8/8 4/4 5/5 Mette Bøjer Jensen (f) 2018 2022 Danish Dec. 1975 Not independent 7 8/8 3/3 Kasim Kutay (m) 2017 2020 British May 1965 Not independent 4 8/8 3/3 Anne Marie Kverneland (f) 2000 2022 Danish Jul. 1956 Not independent 7 8/8 5/5 Martin Mackay (m) 2018 2020 American Apr. 1956 Independent 8/8 6/6 Thomas Rantzau (m) 2018 2022 Danish Mar. 1972 Not independent 7 8/8 6/6 Stig Strøbæk (m) 1998 2022 Danish Jan. 1964 Not independent 5, 7 8/8 4/4 1. Number of meetings attended by each board member out of the total number of meetings within the member's term. 2. As designated by Nasdaq Copenhagen in accordance with section 3.2.1 of Recommendations on Corporate Governance. 3. In addition, Helge Lund was a member of the Board for one year in 2014-2015 4. Member of the board or the management of Novo Holdings A/S. 5. Pursuant to the US Securities Exchange Act, Ms Hewitt, Ms Grégoire and Mr Fibig qualify as independent Audit Committee members, while Mr Strøbæk relies on an exemption from the independence requirements. 6. Ms Hewitt, Ms Grégoire and Mr Fibig qualify as independent Audit Committee members as defined under part 8 of the Danish Act on Approved Auditors and Audit Firms. 7. Elected Novo Nordisk Annual Report 2019 by employees of Novo Nordisk.

Introducing Novo Nordisk Our business Governance Consolidated statements 40 Executive Management Lars Fruergaard Jørgensen — President and chief Doug Langa* — Executive vice president, executive officer (CEO) North America Operations Born: November 1966. Born: October 1966. Other positions and management duties: Other positions and management duties: Vice-chair of the supervisory board and member of the No other management positions. nomination committee of Carlsberg A/S, Denmark. Monique Carter — Executive vice president, Camilla Sylvest — Executive vice president, People & Organisation Commercial Strategy & Corporate Affairs Born: December 1973. Born: November 1972. Other management positions: Other management duties: No other management positions. Member of the board of Danish Crown A/S, Denmark and Vice Chair of the board of the World Diabetes Foundation, Denmark. Maziar Mike Doustdar* — Executive vice president, Mads Krogsgaard Thomsen — Executive vice International Operations president, chief science officer (CSO) Born: August 1970. Born: December 1960. Other positions and management duties: Other management duties: No other management positions. Member of the board of Symphogen A/S, Denmark. Member of the editorial boards of international, peer- reviewed journals. Adjunct professor at the Faculty of Health and Medical Sciences of the University of Copenhagen, Denmark. Ludovic Helfgott* — Executive vice president, Biopharm Born: July 1974. Henrik Wulff — Executive vice president, Product Supply, Quality & IT Other management positions: Born: November 1970. No other management positions. Other management duties: Chair of the board of Novo Nordisk Pharmatech A/S and member of the board of Ambu A/S, both in Denmark. Karsten Munk Knudsen — Executive vice president, chief financial officer (CFO) Born: December 1971. Other positions and management duties: Chair of the board of NNE A/S, Denmark. * Not registered as executive with the Danish Business Authority. Novo Nordisk Annual Report 2019

41 Consolidated financial, social and environmental statements 2019 Consolidated financial statements Consolidated social statement (supplementary information) Income statement .....................................................p 42 Cash flow statement ..................................................p 43 Statement of social performance........................................p 78 Balance sheet .........................................................p 44 Equity statement ......................................................p 45 Notes to the Consolidated social statement Notes to the Consolidated financial statements Section 6 Section 1 Basis of preparation .................................................p 78 Basis of preparation 1.1 Principal accounting policies and key accounting estimates ...........p 46 Section 7 1.2 Changes in accounting policies and disclosures .....................p 47 Patients 1.3 General accounting policies ......................................p 47 7.1 Patients reached with Novo Nordisk’s Diabetes care products (estimate)... p 80 7.2 Donations......................................................p 80 Section 2 7.3 Animals purchased for research....................................p 80 Results for the year 2.1 Net sales and rebates.............................................p 48 Section 8 2.2 Segment information.............................................p 49 Employees 2.3 Research and development costs..................................p 51 8.1 Employees......................................................p 81 2.4 Employee costs..................................................p 52 8.2 Frequency of occupational accidents...............................p 81 2.5 Other operating income, net......................................p 53 2.6 Income taxes and deferred income taxes............................p 53 Section 9 Responsible business Section 3 Operating assets and liabilities 9.1 Relevant employees trained in business ethics.......................p 82 9.2 Business ethics reviews...........................................p 82 3.1 Intangible assets.................................................p 55 9.3 Facilitations of the Novo Nordisk Way..............................p 82 3.2 Property, plant and equipment....................................p 56 9.4 Supplier audits..................................................p 82 3.3 Leases..........................................................p 57 9.5 Product recalls...................................................p 83 3.4 Inventories......................................................p 58 9.6 Failed inspections................................................p 83 3.5 Trade receivables.................................................p 59 9.7 Company trust..................................................p 83 3.6 Retirement benefit obligations.....................................p 60 9.8 Total tax contribution.............................................p 83 3.7 Provisions and contingent liabilities.................................p 61 3.8 Other liabilities..................................................p 62 Consolidated environmental statement (supplementary information) Section 4 Capital structure and financial items Statement of environmental performance.................................p 84 4.1 Share capital, distributions to shareholders and earnings per share.....p 63 4.2 Borrowings.....................................................p 64 Notes to the Consolidated environmental statement 4.3 Financial risks...................................................p 65 4.4 Derivative financial instrument.....................................p 67 4.5 Cash and cash equivalents, financial resources and free cash flow......p 68 Section 10 Basis of preparation .................................................p 84 4.6 Change in working capital........................................p 68 4.7 Other non-cash items............................................p 68 4.8 Financial assets and liabilities......................................p 69 Section 11 4.9 Financial income and expenses....................................p 70 Resources 11.1 Energy consumption for operations and share of renewable power....p 85 Section 5 11.2 Water consumption for production sites............................p 85 Other disclosures 5.1 Share-based payment schemes....................................p 71 Section 12 5.2 Commitments...................................................p 73 Emissions and waste 5.3 Related party transactions.........................................p 74 12.1 CO emissions from operations and transportation...................p 85 5.4 Fee to statutory auditors..........................................p 74 2 5.5 Companies in the Novo Nordisk Group.............................p 75 12.2 Waste from production sites......................................p 86 Section 13 Responsible business Novo Nordisk Annual Report 2019 13.1 Breaches of regulatory limit values.................................p 86

Consolidated Financial Statements 42 Income statement and statement of comprehensive income for the year ended 31 December DKK million Note 2019 2018 2017 Income statement Net sales 2.1, 2.2 122,021 111,831 111,696 Cost of goods sold 2.2 20,088 17,617 17,632 Gross profit 101,933 94,214 94,064 Sales and distribution costs 2.2 31,823 29,397 28,340 Research and development costs 2.2, 2.3 14,220 14,805 14,014 Administrative costs 2.2 4,007 3,916 3,784 Other operating income, net 2.2, 2.5 600 1,152 1,041 Operating profit 52,483 47,248 48,967 Financial income 4.9 65 2,122 1,246 Financial expenses 4.9 3,995 1,755 1,533 Profit before income taxes 48,553 47,615 48,680 Income taxes 2.6 9,602 8,987 10,550 Net profit for the year 38,951 38,628 38,130 Earnings per share Basic earnings per share (DKK) 4.1 16.41 15.96 15.42 Diluted earnings per share (DKK) 4.1 16.38 15.93 15.39 DKK million Note 2019 2018 2017 Statement of comprehensive income Net profit for the year 38,951 38,628 38,130 Other comprehensive income: Items that will not be reclassified subsequently to the income statement: Remeasurements of retirement benefit obligations 3.6 (187) 87 103 Items that will be reclassified subsequently to the income statement: Exchange rate adjustments of investments in subsidiaries 226 491 (632) Cash flow hedges, realisation of previously deferred (gains)/losses 4.4 1,677 (2,027) 1,955 Cash flow hedges, deferred gains/(losses) incurred during the period 4.4 (329) (1,677) 1,987 Other items 9 (27) (577) Tax on other comprehensive income, income/(expense) 2.6 (231) 755 (1,041) Other comprehensive income for the year, net of tax 1,165 (2,398) 1,795 Total comprehensive income for the year 40,116 36,230 39,925 Novo Nordisk Annual Report 2019

Consolidated Financial Statements 43 Cash flow statement for the year ended 31 December DKK million Note 2019 2018 2017 Cash flow statement Net profit for the year 38,951 38,628 38,130 Adjustment of non-cash items: Income taxes in the income statement 2.6 9,602 8,987 10,550 Depreciation, amortisation and impairment losses 3.1, 3.2 5,661 3,925 3,182 Other non-cash items 4.7 7,032 6,098 2,027 Change in working capital 4.6 (3,388) (3,370) (3,634) Interest received 64 51 101 Interest paid (204) (89) (87) Income taxes paid 2.6 (10,936) (9,614) (9,101) Net cash generated from operating activities 46,782 44,616 41,168 Purchase of intangible assets 3.1 (2,299) (2,774) (1,022) Proceeds from sale of property, plant and equipment 4 13 9 Purchase of property, plant and equipment 3.2 (8,932) (9,636) (7,626) Proceeds from other financial assets 148 178 73 Purchase of other financial assets (350) (248) (40) Sale of marketable securities — — 2,009 Investment in associated companies 5.3 (97) — — Proceeds from the divestment of Group and associated companies (3) 368 — Dividend received from associated companies 5.3 20 19 26 Net cash used in investing activities (11,509) (12,080) (6,571) Purchase of treasury shares 4.1 (15,334) (15,567) (16,845) Dividends paid 4.1 (19,409) (19,048) (18,844) Repayment of borrowings, net 4.2 (741) 94 — Net cash used in financing activities (35,484) (34,521) (35,689) Net cash generated from activities (211) (1,985) (1,092) Cash and cash equivalents at the beginning of the year 4.5 15,629 17,158 18,461 Reclassification of bank overdraft to financing activities 4.5 — 412 — Exchange gains/(losses) on cash and cash equivalents (7) 44 (211) Cash and cash equivalents at the end of the year 4.5 15,411 15,629 17,158 Novo Nordisk Annual Report 2019

Consolidated Financial Statements 44 Balance sheet at 31 December DKK million Note 2019 2018 Assets Intangible assets 3.1 5,835 5,145 Property, plant and equipment 3.2 50,551 41,891 Investments in associated companies 474 531 Deferred income tax assets 2.6 4,121 2,893 Other receivables and prepayments 4.8 841 — Other financial assets 4.8 1,334 1,242 Total non-current assets 63,156 51,702 Inventories 3.4 17,641 16,336 Trade receivables 3.5, 4.8 24,912 22,786 Tax receivables 806 1,013 Other receivables and prepayments 4.8 3,434 3,090 Derivative financial instruments 4.3, 4.4, 4.8 188 204 Cash at bank 4.3, 4.5, 4.8 15,475 15,638 Total current assets 62,456 59,067 Total assets 125,612 110,769 Equity and liabilities Share capital 4.1 480 490 Treasury shares 4.1 (10) (11) Retained earnings 57,817 53,406 Other reserves (694) (2,046) Total equity 57,593 51,839 Borrowings 4.2, 4.8 3,009 — Deferred income tax liabilities 2.6 80 118 Retirement benefit obligations 3.6 1,334 1,256 Provisions 3.7 4,613 3,392 Total non-current liabilities 9,036 4,766 Borrowings 4.2, 4.8 1,474 515 Trade payables 4.8 6,358 6,756 Tax payables 4,212 4,610 Other liabilities 3.8, 4.8 15,085 14,098 Derivative financial instruments 4.4, 4.8 734 2,024 Provisions 3.7 31,120 26,161 Total current liabilities 58,983 54,164 Total liabilities 68,019 58,930 Total equity and liabilities 125,612 110,769 Novo Nordisk Annual Report 2019

Consolidated Financial Statements 45 Equity statement at 31 December Other reserves Exchange rate Cash Tax and Total Share Treasury Retained adjust- flow other other DKK million capital shares earnings ments hedges items reserves Total 2017 Balance at the beginning of the year 510 (9) 46,111 (924) (1,915) 1,496 (1,343) 45,269 Net profit for the year 38,130 38,130 Other comprehensive income for the year 103 (632) 3,942 (1,618) 1,692 1,795 Total comprehensive income for the year 38,233 (632) 3,942 (1,618) 1,692 39,925 Transactions with owners: Dividends (note 4.1) (18,844) (18,844) Share-based payments (note 5.1) 292 292 Tax related to restricted stock units (note 2.6) 18 18 Purchase of treasury shares (note 4.1) (12) (16,833) (16,845) Reduction of the B share capital (note 4.1) (10) 10 — Balance at the end of the year 500 (11) 48,977 (1,556) 2,027 (122) 349 49,815 2018 Change in accounting policy, IFRS 9 (net of tax) (90) 90 90 — Net profit for the year 38,628 38,628 Other comprehensive income for the year 87 491 (3,704) 728 (2,485) (2,398) Total comprehensive income for the year 38,625 491 (3,704) 818 (2,395) 36,230 Transactions with owners: Dividends (note 4.1) (19,048) (19,048) Share-based payments (note 5.1) 414 414 Tax related to restricted stock units (note 2.6) (5) (5) Purchase of treasury shares (note 4.1) (10) (15,557) (15,567) Reduction of the B share capital (note 4.1) (10) 10 — Balance at the end of the year 490 (11) 53,406 (1,065) (1,677) 696 (2,046) 51,839 2019 Net profit for the year 38,951 38,951 Other comprehensive income for the year (187) 226 1,348 (222) 1,352 1,165 Total comprehensive income for the year 38,764 226 1,348 (222) 1,352 40,116 Transactions with owners: Dividends (note 4.1) (19,409) (19,409) Share-based payments (note 5.1) 363 363 Tax related to restricted stock units (note 2.6) 18 18 Purchase of treasury shares (note 4.1) (9) (15,325) (15,334) Reduction of the B share capital (note 4.1) (10) 10 — Balance at the end of the year 480 (10) 57,817 (839) (329) 474 (694) 57,593 Novo Nordisk Annual Report 2019

Consolidated Financial Statements 46 Section 1 Basis of preparation 1.1 Principal accounting policies and key accounting estimates The consolidated financial statements included in this Annual Report have been The key accounting estimates identified are those that have a significant risk of prepared in accordance with International Financial Reporting Standards (IFRS) as resulting in a material adjustment to the measurement of assets and liabilities issued by the International Accounting Standards Board (IASB) and in accordance in the following reporting period. Management bases its estimates on historical with IFRS as endorsed by the EU and further requirements in the Danish Financial experience and various other assumptions that are held to be reasonable under Statements Act. All entities in the Novo Nordisk Group follow the same Group the circumstances. The estimates and underlying assumptions are reviewed on accounting policies. an ongoing basis. If necessary, changes are recognised in the period in which the estimate is revised. Management considers the key accounting estimates to be Measurement basis reasonable and appropriate based on currently available information. The actual The consolidated financial statements have been prepared on the historical cost amounts may differ from the amounts estimated as more detailed information basis except for derivative financial instruments, equity investments and trade becomes available. receivables in a factoring portfolio, which are measured at fair value. In addition, Management makes judgements and estimates in the process of Except for the changes described in note 1.2, the principal accounting policies set applying the entity’s accounting policies, for example regarding recognition and out below have been applied consistently in the preparation of the consolidated measurement of deferred income tax assets or the classification of transactions. financial statements for all the years presented. Management regards those listed below as the key accounting estimates and Principal accounting policies judgements used in the preparation of the consolidated financial statements. Novo Nordisk’s accounting policies are described in each of the individual notes to the consolidated financial statements. Accounting policies listed in the table below Please refer to the specific notes for further information on the key accounting are regarded as the principal accounting policies applied by the Management. estimates and judgements as well as assumptions applied. Key accounting estimates and judgements The use of reasonable estimates and judgements is an essential part of the prepa- ration of the consolidated financial statements. Given the uncertainties inherent in Novo Nordisk’s business activities, Management must make certain estimates regarding valuation and judgements on the reported amounts of assets, liabilities, net sales, expenses and related disclosures. Principal accounting policies Key accounting estimates and judgements Note Estimation risk US net sales and rebates Estimate of US sales deductions and provisions for sales rebates 2.1 High Income taxes and deferred income taxes Judgement and estimate regarding deferred income tax assets and provision for 2.6 Medium uncertain tax positions Intangible assets Estimate regarding impairment of assets 3.1 Low Inventories Estimate of indirect production costs capitalised and inventory write-down 3.4 Low Provisions and contingent liabilities Estimate of ongoing legal disputes, litigation and investigations 3.7 High Applying materiality The consolidated financial statements are a result of processing large numbers of There are substantial disclosure requirements throughout IFRS. Management transactions and aggregating those transactions into classes according to their provides specific disclosures required by IFRS unless the information is not appli- nature or function. The transactions are presented in classes of similar items in cable or is considered immaterial to the economic decision-making of the users of the consolidated financial statements. If a line item is not individually material, these financial statements. it is aggregated with other items of a similar nature in the consolidated financial statements or in the notes. Novo Nordisk Annual Report 2019

Consolidated Financial Statements 47 1.2 Changes in accounting policies and disclosures The following recognition exemptions and practical expedients were applied on transition: • Applied a single discount rate to a portfolio of leases with similar characteristics Adoption of new or amended IFRSs • Excluded initial direct costs from measuring the right-of-use asset at the date of Management has assessed the impact of new or amended and revised accounting initial application standards and interpretations (IFRSs) issued by the IASB and IFRSs endorsed by the • Used hindsight when determining the lease term if the contract contains option European Union. to extend or terminate • Exempted short-term lease contracts with a remaining duration of 12 months IFRS 16 'Leases' or less as at 1 January 2019 As of 1 January 2019 Novo Nordisk applied IFRS 16 'Leases' for the first time. Reconciliation of lease liabilities pursuant to IFRS 16 on transition: The Group has implemented IFRS 16 'Leases' using the modified retrospective 1 January approach. DKK million 2019 Under this method, the cumulative effect of initially applying the standard is Operating lease commitment as disclosed in the Group's recognised at 1 January 2019. Right-of-use assets and lease liabilities have been 2018 consolidated financial statements 4,896 recognised for those leases previously classified as operating leases, except for short-term leases and leases of low value assets. The right-of-use assets have been Short-term leases (142) recognised based on the amount equal to the lease liabilities, adjusted for any Leases of low value assets (43) related prepaid and accrued lease payments previously recognised. Lease liabilities Service commitments excluded (220) are recognised based on the present value of the remaining lease payments, Other (31) discounted using the incremental borrowing rate as of 1 January 2019. The comparative information has not been restated. Lease liability on transition (undiscounted) 4,460 Impact from IFRS 16 as of 1 January 2019: Discounted using the Group's incremental borrowing rate at 1 January 2019 2.95% 1 January DKK million 2019 Lease liability recognised on transition 3,988 Property, plant and equipment 3,778 Prepayments (5) Borrowings (non-current) 3,330 On transition to IFRS 16, Novo Nordisk recognised lease liabilities in relation to Borrowings (current) 658 leases which had previously been classified as operating leases in accordance Other liabilities (215) with IAS 17. The lease liabilities were measured at the present value of the future discounted lease payments using Novo Nordisk's incremental borrowing rate at Net assets — 1 January 2019. The weighted average incremental borrowing rate applied on transition to IFRS 16 was 2.95%. On transition to IFRS 16, the Group recognised an additional DKK 3,778 million of Other new interpretations effective 1 January 2019 right-of-use assets and DKK 3,988 million of lease liabilities. It is assessed that application of other new interpretations effective on 1 January 2019 has not had a material impact on the Consolidated financial statements in The change in policy has had an insignificant impact on the income statement. 2019. Furthermore, Management does not anticipate any significant impact on In the cash flow statement the principal repayment of lease liabilities is presented future periods from the adoption of these new interpretations. in 'net cash used in financing activities', whereas the full lease payment under previous policies was presented in 'net cash generated from operating activities'. Adoption of new or amended IFRSs in prior periods The change in policy has had no impact on free cash flow due to a change in As of 1 January 2018 Novo Nordisk applied IFRS 9 'Financial Instruments' and IFRS definition, as described in non-IFRS financial measures. Refer to note 3.3 for the 15 'Revenue from contracts with customers' for the first time. The impact of the new accounting policies. implementation of IFRS 9 and IFRS 15 was immaterial in relation to recognition and measurement. 1.3 General accounting policies Principles of consolidation Translation of transactions and balances The consolidated financial statements incorporate the financial statements of the Foreign currency transactions are translated into the functional currency using the parent company Novo Nordisk A/S and entities controlled by Novo Nordisk A/S. exchange rates prevailing at the transaction dates. Foreign exchange gains and Control exists when Novo Nordisk has effective power over the entity and has the losses resulting from the settlement of such transactions and from the translation right to variable returns from the entity. at year-end exchange rates of monetary assets and liabilities are recognised in the income statement. Where necessary, adjustments are made to bring the financial statements of subsidiaries in line with the Novo Nordisk Group's accounting policies. All intra- Foreign currency differences arising from the translation of effective qualifying Group transactions, balances, income and expenses are eliminated in full when cash flow hedges are recognised in other comprehensive income. consolidated. Translation of Group companies The results of subsidiaries acquired or disposed of during the year are included in Financial statements of foreign subsidiaries are translated into DKK at the the Consolidated income statement from the effective date of acquisition and up exchange rates prevailing at the end of the reporting period for balance sheet to the effective date of disposal. items, and at average exchange rates for income statement items. Translation of foreign currencies All effects of exchange rate adjustments are recognised in other comprehensive Functional and presentation currency income, i.e.: Items included in the financial statements of Novo Nordisk's entities are measured using the currency of the primary economic environment in which the entity oper- • The translation of foreign subsidiaries’ net assets at the beginning of the year to ates (functional currency). The consolidated financial statements are presented in the exchange rates at the end of the reporting period. Danish kroner (DKK), which is also the functional and presentation currency of the • The translation of foreign subsidiaries’ statements of comprehensive income at Novo Nordisk Annual Report 2019 parent company. average to year-end exchange rates.

Consolidated Financial Statements 48 Section 2 Results for the year 2.1 Net sales and rebates Pricing mechanisms in the US market In the US, sales rebates are paid in connection with public healthcare insurance programmes, namely Medicare and Medicaid, as well as rebates to pharmacy Accounting policies benefit managers (PBMs) and managed healthcare plans. Key customers in the US Revenue from sale of goods is recognised when Novo Nordisk has transferred include private payers, PBMs and government payers. PBMs and managed health- control of products sold to the buyer and it is probable that Novo Nordisk will care plans play a role in negotiating price concessions with drug manufacturers for collect the consideration to which it is entitled for transferring the products. both the commercial and government channels, and determine which drugs are Control of the products is transferred at a point in time, typically on delivery. covered on their formularies (or 'preferred drug lists'). The amount of sales to be recognised is based on the consideration Novo Nordisk US Managed Care and Medicare expects to receive in exchange for its goods. When sales are recognised, Novo For Managed Care and Medicare, rebates are offered to a number of PBMs Nordisk also records estimates for a variety of sales deductions, including product and managed healthcare plans. These rebate programmes allow the customer returns as well as rebates and discounts to government agencies, wholesalers, to receive a rebate after attaining certain performance parameters relating to health insurance companies, managed healthcare organisations and retail formulary status or pre-established market shares thresholds. Rebates are esti- customers. Sales deductions are recognised as a reduction of gross sales to arrive mated according to the specific terms in each agreement, historical experience, at net sales, by assessing the expected value of the sales deductions (variable anticipated channel mix, growth rates and market share information. Novo consideration). Where contracts contain customer acceptance criteria, Novo Nordisk adjusts the provision periodically to reflect actual sales performance. Nordisk recognises sales when the acceptance criteria are satisfied. Managed Care and Medicare rebates are generally settled around 100 days from the transaction date. In some markets, Novo Nordisk sells products on a sale-or-return basis. Where there is historical experience or a reasonably accurate estimate of future US wholesaler charge-backs returns, estimated product returns are recorded as a reduction in sales. Wholesaler charge-backs relate to contractual arrangements between Novo Where shipments of new products are made on a sale-or-return basis, without Nordisk and indirect customers in the US whereby products are sold at contract sufficient historical experience for estimating sales returns, revenue is recorded prices lower than the list price originally charged to wholesalers. A wholesaler based on estimated demand and acceptance rates for well-established products charge-back represents the difference between the invoice price to the wholesaler with similar market characteristics. If similar market characteristics do not exist, and the indirect customer’s contract price. Accruals are calculated for estimated revenue is recorded when there is evidence of consumption or when the right of charge-backs using a combination of factors such as historical experience, current return has expired. wholesaler inventory levels, contract terms and the value of claims received but not yet processed. Wholesaler charge-backs are generally settled within 30 days of Key accounting estimates of sales deductions and provisions for sales the liability being incurred. rebates Sales deductions are estimated and provided for at the time the related sales are US Medicaid rebates recorded. These estimates of unsettled rebate, discount and product return obliga- Medicaid is a government insurance programme. Medicaid rebates have been tions require use of significant judgement, as not all conditions are known at the estimated using a combination of historical experience, product and population time of sale, for example total sales volume to a given customer. growth, price increases, and the impact of contracting strategies. The calculation also involves interpretation of relevant regulations that are subject to changes in The estimates are based on analyses of existing contractual obligations and histor- interpretative guidance from government authorities. Novo Nordisk adjusts the ical experience. Provisions are calculated on the basis of a percentage of sales provision periodically to reflect actual sales performance. Medicaid rebates are for each product as defined by the contracts with the various customer groups. generally settled around 150 days from the transaction date. Provisions for sales rebates are adjusted to actual amounts as rebates, discounts and returns are processed. Other US discounts and sales returns Other discounts are provided to wholesalers, hospitals, pharmacies, etc. They Novo Nordisk considers the provisions established for sales rebates to be reason- are usually linked to sales volume or provided as cash discounts. Accruals are able and appropriate based on currently available information. However, the calculated based on historical data and recorded as a reduction in gross sales at actual amount of rebates and discounts may differ from the amounts estimated by the time the related sales are recorded. Sales returns are related to damaged or Management as more detailed information becomes available. expired products. Gross-to-net sales reconciliation Arrangements with certain healthcare providers may require Novo Nordisk to DKK million 2019 2018 2017 make refunds to the healthcare providers if anticipated treatment outcomes do not meet predefined targets. Gross sales 270,431 230,701 216,174 Provisions for sales rebates US Managed Care and Medicare (84,202) (65,207) (53,077) DKK million 2019 2018 2017 US wholesaler charge-backs (33,772) (29,469) (28,324) US Medicaid rebates (14,365) (11,950) (12,491) At the beginning of the year 25,760 20,374 20,063 Other US discounts and sales Additional provisions, including returns (8,280) (6,606) (5,771) increases to existing provisions 102,782 82,631 63,880 Non-US rebates, discounts and sales Amount paid during the year (98,655) (78,647) (61,059) returns (7,791) (5,638) (4,815) Adjustments, including unused amounts reversed during the year 381 386 (117) Total gross-to-net sales adjustments (148,410) (118,870) (104,478) Effect of exchange rate adjustment 610 1,016 (2,393) Net sales 122,021 111,831 111,696 At the end of the year 30,878 25,760 20,374 Sales discounts and sales rebates are predominantly issued in the US. As such, Unsettled rebates are recognised as Provisions when the timing or amount rebates amount to 71% of gross sales in the US (68% in 2018 and 64% in 2017). is uncertain (note 3.7). Where absolute amounts are known, the rebates are Novo Nordisk sales are impacted by exchange rate changes. For developments in recognised as other liabilities. Wholesaler charge-backs are netted against trade key currencies refer to note 4.3. receivable balances. Provisions for sales rebates thus includes US Managed Care, Medicare, Medicaid and other minor US rebate types, as well as rebates in a Novo Nordisk Annual Report 2019 number of European countries and Canada.

Consolidated Financial Statements 49 2.2 Segment information Accounting policies - Biopharm: haemophilia, growth disorders and hormone replacement therapy. Operating segments are reported in a manner consistent with the internal reporting provided to Executive Management and the Board of Directors. We consider Segment performance is evaluated on the basis of operating profit consistent with Executive Management to be the operating decision-making body, as all significant the Consolidated financial statements. Financial income and expenses and income decisions regarding business development and direction are taken in this forum. taxes are managed at Group level and are not allocated to business segments. Business segments There are no sales or other transactions between the business segments. Costs Novo Nordisk operates in two business segments based on therapies: Diabetes and have been split between business segments according to a specific allocation. In Obesity care and Biopharm, representing the entirety of the Group's operations. addition, a small number of corporate overhead costs are allocated systematically between the segments. Other operating income has been allocated to the two The segments include research, development, manufacturing and marketing of segments based on the same principle. Segment assets comprise the assets that products within the following areas: are applied directly to the activities of the segment, including intangible assets, - Diabetes and Obesity care: insulin, GLP-1 and related delivery systems, oral anti- property, plant and equipment, inventories, trade receivables and other receivables diabetic products (OAD), obesity and other serious chronic diseases. and prepayments. Business segments DKK million 2019 2018 2017 2019 2018 2017 2019 2018 2017 Segment sales Diabetes and Obesity care Biopharm Total Long-acting insulin 20,776 20,844 22,174 - of which Tresiba® 9,259 8,035 7,327 - of which Xultophy® 2,210 1,614 729 - of which Levemir® 9,307 11,195 14,118 Premix insulin 10,578 10,194 10,749 - of which Ryzodeg® 993 714 492 - of which NovoMix®/NovoLog Mix® 9,585 9,480 10,257 Fast-acting insulin 19,303 19,353 20,124 - of which Fiasp® 1,243 590 99 - of which NovoRapid®/NovoLog® 18,060 18,763 20,025 Human insulin 9,036 9,265 9,793 Total insulin 59,693 59,656 62,840 Victoza® 21,934 24,333 23,173 Ozempic® 11,237 1,796 — Rybelsus® 50 — — Total GLP-1 33,221 26,129 23,173 Other Diabetes care 4,247 4,250 4,302 Total Diabetes care 97,161 90,035 90,315 Obesity care (Saxenda®) 5,679 3,869 2,562 Diabetes and Obesity care total sales 102,840 93,904 92,877 Haemophilia 10,281 9,576 10,469 - of which NovoSeven® 8,119 7,881 9,206 - of which NovoEight® 1,525 1,354 1,103 Growth disorders (Norditropin®) 7,275 6,834 6,655 Other Biopharm 1,625 1,517 1,695 Biopharm total sales 19,181 17,927 18,819 Segment key figures Total net sales 102,840 93,904 92,877 19,181 17,927 18,819 122,021 111,831 111,696 Cost of goods sold 16,309 14,716 15,014 3,779 2,901 2,618 20,088 17,617 17,632 Sales and distribution costs 28,729 26,396 25,475 3,094 3,001 2,865 31,823 29,397 28,340 Research and development costs 12,128 12,222 11,358 2,092 2,583 2,656 14,220 14,805 14,014 Administrative costs 3,346 3,266 3,143 661 650 641 4,007 3,916 3,784 Other operating income, net 309 538 466 291 614 575 600 1,152 1,041 Operating profit 42,637 37,842 38,353 9,846 9,406 10,614 52,483 47,248 48,967 Operating margin 41.5% 40.3% 41.3% 51.3% 52.5% 56.4% 43.0% 42.2% 43.8% Depreciation, amortisation and impairment losses expensed 3,916 3,210 2,536 1,745 715 646 5,661 3,925 3,182 Additions to Intangible assets and Property, plant and equipment 9,644 9,219 7,565 1,518 3,107 2,226 11,162 12,326 9,791 Assets allocated to business segments 86,700 71,706 61,542 16,514 17,542 14,994 103,214 89,248 76,536 Non-allocated assets1 22,398 21,521 25,819 Total assets 125,612 110,769 102,355 1. The part of total assets that remains unallocated to either of the two business segments includes investments in associated companies, deferred income tax assets, other financial assets, tax receivables, derivative financial instruments and cash at bank. Novo Nordisk Annual Report 2019

Consolidated Financial Statements 50 2.2 Segment information (continued) Geographical areas Net sales disclosures Novo Nordisk operates in two main commercial units: Sales to external customers attributed to the US are collectively the most material to the Group. The US and Mainland China are the only territories where sales • International Operations contribute 10% or more of total net sales. ◦ Region Europe: the EU, EFTA, Albania, Bosnia-Herzegovina, Macedonia, Serbia, Montenegro and Kosovo In 2019, Novo Nordisk had three major wholesalers distributing products, repre- ◦ Region AAMEO: countries in Africa, Asia, Middle East & Oceania senting 19%, 14% and 12% respectively of total net sales (20%, 13% and 13% ◦ Region China: Mainland China, Taiwan and Hong Kong in 2018 and 21%, 13% and 12% in 2017). Sales to these three wholesalers are ◦ Region Japan & Korea: Japan and South Korea within both Diabetes and Obesity care and Biopharm. ◦ Region Latin America: countries in South America, Central America and Mexico Net sales to be recognised from fulfilling existing customer contracts containing • North America Operations (the US and Canada) fixed or minimum sales volumes, with an original term greater than 12 months, is expected to be DKK 544 million within 12 months (2018: DKK 767 million) and Sales are attributed to geographical regions according to the location of the DKK 32 million thereafter (2018: DKK 742 million). customer. Allocation of property, plant and equipment, trade receivables, allow- ance for trade receivables and total assets is based on the location of the assets. Net sales will be impacted by exchange rate fluctuations. Novo Nordisk has an accounting policy to recognise the income statement impact of foreign currency The country of domicile is Denmark, which is part of Region Europe. Denmark hedging within financial items. Please refer to notes 4.3, 4.4 and 4.9 for more is immaterial to Novo Nordisk’s activities in terms of geographical size and the details on hedging. operational business segments. 99.7% of total sales are realised outside Denmark. Of total property, plant and equipment, DKK 25,175 million is located in Denmark, where the Group's main production, filling, packaging, moulding and assembly facilities are located. Geographical areas 2019 2018 2017 2019 2018 2017 2019 2018 2017 2019 2018 2017 International Operations DKK million Total International Operations Region Europe Region AAMEO Region China Sales by business segment: Long-acting insulin 9,035 7,942 7,416 4,720 4,282 3,895 1,526 1,281 1,229 1,059 814 694 - of which Tresiba® 3,477 2,764 2,345 1,685 1,246 966 406 337 261 87 16 2 - of which Xultophy® 1,493 1,085 567 1,266 1,007 560 146 58 7 — — — - of which Levemir® 4,065 4,093 4,504 1,769 2,029 2,369 974 886 961 972 798 692 Premix insulin 9,707 8,862 8,959 1,595 1,701 1,878 2,961 2,606 2,686 4,306 3,783 3,555 - of which Ryzodeg® 993 714 492 68 56 26 429 275 183 4 — — - of which NovoMix®/NovoLog Mix® 8,714 8,148 8,467 1,527 1,645 1,852 2,532 2,331 2,503 4,302 3,783 3,555 Fast-acting insulin 10,304 9,332 9,156 4,732 4,558 4,366 2,622 2,194 2,261 1,753 1,450 1,253 - of which Fiasp® 617 357 91 585 357 91 27 — — — — — - of which NovoRapid®/NovoLog® 9,687 8,975 9,065 4,147 4,201 4,275 2,595 2,194 2,261 1,753 1,450 1,253 Human insulin 7,361 7,348 7,856 1,380 1,580 1,770 2,230 2,065 1,922 2,847 2,821 3,096 Total insulin 36,407 33,484 33,387 12,427 12,121 11,909 9,339 8,146 8,098 9,965 8,868 8,598 Victoza® 7,249 6,240 5,708 3,967 3,720 3,451 1,005 841 858 898 521 309 Ozempic® 1,143 39 — 965 39 — 4 — — — — — Rybelsus® — — — — — — — — — — — — Total GLP-1 8,392 6,279 5,708 4,932 3,759 3,451 1,009 841 858 898 521 309 Other Diabetes care 3,389 3,360 3,359 562 579 605 691 675 754 1,647 1,672 1,566 Total Diabetes care 48,188 43,123 42,454 17,921 16,459 15,965 11,039 9,662 9,710 12,510 11,061 10,473 Obesity care (Saxenda®) 2,083 1,211 569 334 207 102 802 418 190 9 1 — Diabetes and Obesity care total 50,271 44,334 43,023 18,255 16,666 16,067 11,841 10,080 9,900 12,519 11,062 10,473 Haemophilia 5,946 5,572 5,446 2,762 2,781 2,828 1,305 1,177 1,163 284 199 216 - of which NovoSeven® 4,502 4,424 4,597 1,767 1,944 2,245 1,130 1,049 1,097 269 194 215 - of which NovoEight® 1,143 1,046 788 790 776 551 146 109 52 15 5 1 Growth disorders 4,225 4,000 4,105 1,466 1,511 1,572 691 680 676 36 20 15 Other Biopharm 1,122 1,017 1,113 779 721 722 252 216 279 5 4 5 Biopharm total 11,293 10,589 10,664 5,007 5,013 5,122 2,248 2,073 2,118 325 223 236 Total sales by business and geographical segment 61,564 54,923 53,687 23,262 21,679 21,189 14,089 12,153 12,018 12,844 11,285 10,709 Total sales growth as reported 12.1% 2.3% 2.2% 7.3% 2.3% 2.5% 15.9% 1.1% 3.8% 13.8% 5.4% 2.4% Property, plant and equipment 30,972 28,851 27,929 26,730 25,500 24,665 1,003 723 566 2,101 1,812 1,884 Trade receivables, net 10,508 9,884 9,423 3,611 3,388 3,273 3,595 3,237 3,468 1,760 1,841 1,541 Allowance for doubtful trade receivables (1,471) (1,358) (1,262) (196) (241) (223) (967) (866) (823) — — — Total assets 85,541 80,420 81,743 67,007 64,327 65,600 6,729 5,635 5,876 6,820 6,003 5,927 Novo Nordisk Annual Report 2019

Consolidated Financial Statements 51 Geographical areas (continued) 2019 2018 2017 2019 2018 2017 2019 2018 2017 2019 2018 2017 International Operations (continued) North America Operations DKK million Region Japan & Korea Region Latin America Total Of which the US Sales by business segment: Long-acting insulin 930 857 872 800 708 726 11,741 12,902 14,758 11,271 12,600 14,466 - of which Tresiba® 821 751 739 478 414 377 5,782 5,271 4,982 5,500 5,192 4,970 - of which Xultophy® 11 — — 70 20 — 717 529 162 708 528 162 - of which Levemir® 98 106 133 252 274 349 5,242 7,102 9,614 5,063 6,880 9,334 Premix insulin 722 650 697 123 122 143 871 1,332 1,790 839 1,294 1,743 - of which Ryzodeg® 457 351 253 35 32 30 — — — — — — - of which NovoMix®/NovoLog Mix® 265 299 444 88 90 113 871 1,332 1,790 839 1,294 1,743 Fast-acting insulin 790 779 941 407 351 335 8,999 10,021 10,968 8,592 9,634 10,574 - of which Fiasp® 5 — — — — — 626 233 8 597 211 — - of which NovoRapid®/NovoLog® 785 779 941 407 351 335 8,373 9,788 10,960 7,995 9,423 10,574 Human insulin 170 187 232 734 695 836 1,675 1,917 1,937 1,552 1,778 1,766 Total insulin 2,612 2,473 2,742 2,064 1,876 2,040 23,286 26,172 29,453 22,254 25,306 28,549 Victoza® 748 614 590 631 544 500 14,685 18,093 17,465 14,217 17,561 16,929 Ozempic® — — — 174 — — 10,094 1,757 — 9,599 1,634 — Rybelsus® — — — — — — 50 — — 50 — — Total GLP-1 748 614 590 805 544 500 24,829 19,850 17,465 23,866 19,195 16,929 Other Diabetes care 421 368 376 68 66 58 858 890 943 705 733 782 Total Diabetes care 3,781 3,455 3,708 2,937 2,486 2,598 48,973 46,912 47,861 46,825 45,234 46,260 Obesity care (Saxenda®) 282 175 — 656 410 277 3,596 2,658 1,993 3,348 2,446 1,828 Diabetes and Obesity care total 4,063 3,630 3,708 3,593 2,896 2,875 52,569 49,570 49,854 50,173 47,680 48,088 Haemophilia 560 557 681 1,035 858 558 4,335 4,004 5,023 4,031 3,723 4,852 - of which NovoSeven® 377 400 497 959 837 543 3,617 3,457 4,609 3,454 3,278 4,451 - of which NovoEight® 116 135 169 76 21 15 382 308 315 358 291 315 Growth disorders 1,746 1,538 1,579 286 251 263 3,050 2,834 2,550 3,035 2,823 2,543 Other Biopharm 84 72 104 2 4 3 503 500 582 247 262 348 Biopharm total 2,390 2,167 2,364 1,323 1,113 824 7,888 7,338 8,155 7,313 6,808 7,743 Total sales by business and geographical segment 6,453 5,797 6,072 4,916 4,009 3,699 60,457 56,908 58,009 57,486 54,488 55,831 Total sales growth as reported 11.3% (4.5%) (2.5%) 22.6% 8.4% 3.0% 6.2% (1.9%) (2.1%) 5.5% (2.4%) (2.4%) Property, plant and equipment 436 201 146 702 615 668 19,579 13,040 7,318 19,531 13,023 7,298 Trade receivables, net 495 504 279 1,047 914 862 14,404 12,902 10,742 13,999 12,643 10,517 Allowance for doubtful trade receivables (7) (5) (5) (301) (246) (211) (13) (12) (32) (13) (12) (32) Total assets 1,543 1,503 1,304 3,442 2,952 3,036 40,071 30,349 20,612 39,460 29,732 20,180 2.3 Research and development costs Accounting policies to significant regulatory uncertainties and other uncertainties inherent in the devel- Novo Nordisk’s research and development is mainly focused on: opment of new products. This means that they do not qualify for capitalisation as intangible assets until marketing approval by a regulatory authority is obtained • Insulins, GLP-1s and other therapeutic new antidiabetic drugs for diabetes or considered highly probable. Costs for post-approval activities that are required treatment. by authorities as a condition for obtaining regulatory approval are recognised as • GLP-1s, combinations and new modes of action for Obesity care. research and development costs. • Blood-clotting factors and new modes of action for haemophilia treatment. • Human growth hormone for treatment of growth disorders. Research and development activities are carried out by Novo Nordisk’s research and • New modes of action including GLP-1 and stem cells for treatment of NASH, development centres, mainly in Denmark, the US, the UK and China. Research and cardiovascular disease, chronic kidney disease and Parkinson's disease, among development trials are carried out all over the world. Novo Nordisk also enters into others. partnerships and licence agreements. The research activities mainly utilise biotechnological methods based on advanced Research and development costs primarily comprise employee costs, and internal protein chemistry and protein engineering. These methods have played a key role and external costs related to execution of studies, including manufacturing costs in the development of the production technology used to manufacture insulin, and facility costs of the research centres. The costs also comprise amortisation, GLP-1, recombinant blood-clotting factors and human growth hormone. depreciation and impairment losses related to software and property, plant and equipment used in the research and development activities. Impairment losses Novo Nordisk expenses all research costs. In line with industry practice, internal recognised on intangible assets not yet available for use related to research and Novo Nordisk Annual Report 2019 and subcontracted development costs are also expensed as they are incurred, due development projects are presented in research and development costs.

Consolidated Financial Statements 52 2.3 Research and development costs (continued) 2.4 Employee costs Certain research and development activities are recognised outside research and Accounting policies development costs: Wages, salaries, social security contributions, annual leave and sick leave, bonuses and non-monetary benefits are recognised in the year in which the • Royalty expenses paid to partners after regulatory approval are expensed as cost associated services are rendered by employees of Novo Nordisk. Where Novo of goods sold. Nordisk provides long-term employee benefits, the costs are accrued to match the • Royalty income received from partners is recognised as part of other operating rendering of the services by the employees concerned. income, net. • Contractual research and development obligations to be paid in the future are Employee costs disclosed separately as commitments in note 5.2. DKK million 2019 2018 2017 Research and development costs by business segment (note 2.2) Wages and salaries 25,335 25,259 23,869 DKK million 2019 2018 2017 Share-based payment costs (note 5.1) 363 414 292 Pensions – defined contribution plans 1,910 1,791 1,800 Diabetes and Obesity care 12,128 12,222 11,358 Pensions – defined benefit plans Biopharm 2,092 2,583 2,656 (note 3.6) 151 73 165 Total 14,220 14,805 14,014 Other social security contributions 1,963 1,901 1,910 Other employee costs 2,203 2,087 2,102 Total employee costs for the year 31,925 31,525 30,138 Research and development costs Employee costs capitalised as DKK million 2019 2018 2017 intangible assets and property, plant Employee costs (note 2.4) 5,968 6,288 5,848 and equipment (1,314) (1,500) (1,435) Amortisation and impairment Change in employee costs capital- losses, intangible assets (note 3.1) 522 769 211 ised as inventories (139) (105) (91) Depreciation and impairment losses, Total employee costs property, plant and equipment 783 468 525 in the income statement 30,472 29,920 28,612 (note 3.2) Other research and development Included in the income statement: costs 6,947 7,280 7,430 Cost of goods sold 8,134 8,164 7,854 Sales and distribution costs 13,463 12,214 11,994 Total research and development Research and development costs 5,968 6,288 5,848 costs 14,220 14,805 14,014 Administrative costs 2,679 2,755 2,505 As percentage of net sales 11.7% 13.2% 12.5% Other operating income, net 228 499 411 Total employee costs in the income statement 30,472 29,920 28,612 Average number of full-time employees 42,218 42,881 41,665 Year-end number of full-time employees 42,703 42,672 42,076 Employees (total) 43,258 43,202 42,682 Remuneration to Executive Management and Board of Directors DKK million 2019 2018 2017 Salary and short-term incentive 120 102 74 Pension 26 22 18 Benefits 14 4 6 Long-term incentive3 40 22 7 Severance payments — 28 — Executive Management in total1,2 200 178 105 Fee to Board of Directors2 19 17 16 Total 219 195 121 1. Jesper Brandgaard retired from Novo Nordisk in April 2019. Until April 2020 Jesper Brandgaard will continue to provide certain services for Novo Nordisk. Remuneration of Jesper Brandgaard from January to April 2019 is included in the above table. A severance payment of DKK 27.7 million is included in the 2018 amounts. 2. Total remuneration for registered members of Executive Management amounts to DKK 135 million (DKK 142 million in 2018 and DKK 74 million in 2017). All members of the Board of Directors are registered. 3. Please refer to note 5.1 for further information. Novo Nordisk Annual Report 2019

Consolidated Financial Statements 53 2.5 Other operating income, net Accounting policies the significant uncertainties in achieving the milestones are resolved, due to Other operating income, net, comprises licence income and income of a the significant uncertainties inherent in the development of pharmaceutical secondary nature in relation to the main activities of Novo Nordisk. Licence income products. from royalties on future net sales is recognised as the underlying customers' sale occurs and from sales milestones once the contingent sale milestone is achieved Operating profit from the wholly owned subsidiary NNE A/S, not related to in accordance with the terms of the relevant agreement. Income from the transfer Novo Nordisk’s main activities, is recognised as other operating income. Other of the right to use intellectual property may contain development or regulatory operating income also includes income from sale of intellectual property rights. milestones (variable consideration) on which the income is recognised when 2.6 Income taxes and deferred income taxes Income taxes Income taxes expensed DKK million 2019 2018 2017 Accounting policies Current tax on profit for the year 11,275 10,469 10,562 The tax expense for the period comprises current and deferred tax as well as Deferred tax on profit for the year (1,559) (1,007) 182 interest on tax cases ongoing or settled during the year. It also includes adjust- ments to previous years and changes in provisions for uncertain tax positions. Tax Tax on profit for the year 9,716 9,462 10,744 is recognised in the income statement except to the extent that it relates to items Current tax adjustments recognised recognised in equity or other comprehensive income. for prior years (191) (522) (425) Provisions for ongoing tax disputes are included as part of deferred tax assets, tax Deferred tax adjustments recognised receivables and tax payables. for prior years 77 47 231 Income taxes in the Management judgement regarding recognition of deferred income tax income statement 9,602 8,987 10,550 assets and provisions for uncertain tax positions Novo Nordisk is subject to income taxes around the world. Significant judgement Tax on other comprehensive and estimates are required in determining the worldwide accrual for income taxes, income for the year, (income)/ deferred income tax assets and liabilities and provisions for uncertain tax positions. expense 231 (755) 1,041 Novo Nordisk recognises deferred income tax assets if it is probable that sufficient taxable income will be available in the future, against which the temporary differ- ences and unused tax losses can be utilised. DKK million 2019 2018 2017 Management has considered future taxable income and applied its judgement in Computation of effective tax rate: assessing whether deferred income tax assets should be recognised. Statutory corporate income tax rate in Denmark 22.0% 22.0% 22.0% In the course of conducting business globally, tax and transfer pricing disputes Deviation in foreign subsidiaries’ with tax authorities may occur. Management judgement is applied to assess the tax rates compared to the Danish possible outcome of such disputes. The 'most probable outcome' method is tax rate (net) (2.1%) (1.9%) 0.0% applied when making provisions for uncertain tax positions, and Novo Nordisk Non-taxable income less considers the provisions made to be adequate. However, the actual obligation may non-tax-deductible expenses (net) 0.1% (0.2%) 0.1% deviate and depends on the result of litigation and settlements with the relevant tax authorities. Others, including adjustment of prior years (0.2%) (1.0%) (0.4%) Swiss tax reform Effective tax rate 19.8% 18.9% 21.7% In 2019, a tax reform was passed in Switzerland. The tax reform has a minor positive impact on the effective tax rate in 2019, driven by a non-recurring increase to deferred tax assets. The impact of the deviation in foreign subsidiaries’ tax rates compared to the Danish tax rate is mainly driven by Swiss business activities. Income taxes paid DKK million 2019 2018 2017 Income taxes paid in Denmark for current year 7,774 6,640 6,798 Income taxes paid outside Denmark for current year 2,258 2,376 2,639 Income taxes paid/repayments relating to prior years 904 598 (336) Total income taxes paid 10,936 9,614 9,101 Novo Nordisk Annual Report 2019

Consolidated Financial Statements 54 2.6 Income taxes and deferred income taxes (continued) Deferred income taxes Accounting policies Deferred income taxes arise from temporary differences between the accounting In general, the Danish tax rules related to dividends from group companies and tax values of the individual consolidated companies and from realisable tax provide exemption from tax for most repatriated profits. A provision for with- loss carry-forwards. The tax value of tax loss carry-forwards is included in deferred holding tax is only recognised if a concrete distribution of dividends is planned. tax assets to the extent that these are expected to be utilised in future taxable The unrecognised potential withholding tax amounts to DKK 315 million for 2019 income. The deferred income taxes are measured according to current tax rules (DKK 367 million in 2018). and at the tax rates assumed in the year in which the assets are expected to be utilised. The value of future tax deductions in relation to share programmes is recognised as deferred tax, until the shares are paid out to the employees. Any estimated excess tax deduction compared to the costs realised in the income statement is charged to equity. Development in deferred income tax assets and liabilities Property, Offset plant and Intangible within DKK million equipment assets Inventories Liabilities Other countries Total 2019 Net deferred tax asset/(liability) at 1 January (703) (564) 973 2,402 667 — 2,775 Change in accounting policy, leases (865) — — 865 — — Income/(charge) to the income statement (5) (155) 820 133 689 1,482 Income/(charge) to other comprehensive income — — 18 47 (296) (231) Income/(charge) to equity — — — — 18 18 Disposal of subsidiaries — — — (18) — (18) Effect of exchange rate adjustment (18) 1 — 23 9 15 Net deferred tax asset/(liability) at 31 December (1,591) (718) 1,811 3,452 1,087 — 4,041 Classified as follows: Deferred tax asset at 31 December 769 58 3,428 3,580 1,843 (5,557) 4,121 Deferred tax liability at 31 December (2,360) (776) (1,617) (128) (756) 5,557 (80) 2018 Net deferred tax asset/(liability) at 1 January (868) (500) 833 1,658 (28) — 1,095 Income/(charge) to the income statement 199 (67) 177 763 (112) 960 Income/(charge) to other comprehensive income — — (37) (22) 814 755 Income/(charge) to equity — — — — (15) (15) Effect of exchange rate adjustment (34) 3 — 3 8 (20) Net deferred tax asset/(liability) at 31 December (703) (564) 973 2,402 667 — 2,775 Classified as follows: Deferred tax asset at 31 December 694 52 2,490 2,403 833 (3,579) 2,893 Deferred tax liability at 31 December (1,397) (616) (1,517) (1) (166) 3,579 (118) The total tax value of unrecognised tax loss carry-forwards amounts to DKK 144 million in 2019 (DKK 90 million in 2018). Novo Nordisk Annual Report 2019

Consolidated Financial Statements 55 Section 3 Operating assets and liabilities 3.1 Intangible assets Accounting policies Additions Patents and licences, including patents and licences acquired for research and Additions to intangible assets amount to DKK 2,179 million. The additions related development projects, are carried at historical cost less accumulated amortisation to patents and licences amount to DKK 1,599 million (DKK 1,403 million in 2018) and any impairment loss. Amortisation is based on the straight-line method over within Diabetes and Obesity care and DKK 359 million (DKK 1,165 million in the estimated useful life. This means the legal duration or the economic useful life 2018) within Biopharm. Please refer to note 5.2 Commitment for an overview of depending on which is shorter, and not exceeding 15 years. The amortisation of total contractual commitments. patents and licences begins after regulatory approval has been obtained. In 2018 and 2019 Novo Nordisk both acquired intellectual property and entered Internal development of software for internal use is recognised as intangible assets into major patent and licence agreements, as summarised below. Upfront fees if the recognition criteria are met, for example a significant business system where and acquisition costs have been capitalised and subsequent milestone payments the expenditure leads to the creation of a durable asset. Amortisation is based on payable on achievement of a contingent event will be capitalised on the contin- the straight-line method over the estimated useful life of 3-15 years. The amortisa- gent event being probable of being achieved. tion begins when the asset is in the location and condition necessary for it to be capable of operating in the manner intended by Management. 2019 additions Research and development projects Internal and subcontracted research costs are charged in full to the consolidated Dicerna income statement in the period in which they are incurred. Consistent with Novo Nordisk has entered into a collaboration and license agreement providing industry practice, internal development costs are also expensed until regulatory development and commercialisation rights to novel therapies for the treatment approval is obtained or is probable; please refer to note 2.3. of liver-related cardio-metabolic diseases using Dicerna’s proprietary GalXC™ RNAi platform technology. The addition relates to the Diabetes and Obesity care Payments to third parties under collaboration and license agreements are assessed for segment. the substance of their nature. Payments which represent subcontracted research and development are expensed as the services are received. Payments which represent rights Priority review voucher to the transfer of intellectual property, developed at risk by the third party, are capitalised. During 2019 Novo Nordisk acquired a priority review voucher intended for use in the Diabetes and Obesity care segment. For acquired research and development projects, patents and licences the likeli- hood of obtaining future commercial sales is reflected in the cost of the asset, and Esperoct™ milestones thus the probability recognition criteria is always considered to be satisfied. As Novo Nordisk has capitalised two milestone payments to the business partner the cost of acquired research and development projects can often be measured following EU and FDA approval of Esperoct™. The additions relate to the reliably, these projects fulfil the capitalisation criteria as intangible assets on acqui- Biopharm segment. sition. Subsequent milestone payments payable on achievement of a contingent event (e.g. commencement of phase 3 trials) are accrued and capitalised into the cost of the intangible asset when the achievement of the event is probable. 2018 additions However, further internal development costs subsequent to acquisition are treated in the same way as other internal development costs. Macrilen™ Novo Nordisk has acquired the US and Canadian rights to Macrilen™ (macimo- Key accounting estimates of impairment of assets relin), the first and only FDA-approved oral growth hormone receptor indicated for Intangible assets with an indefinite useful life and intangible assets not yet avail- the diagnosis of Adult Growth Hormone Deficiency, a rare endocrine disorder. The able for use are not subject to amortisation. They are tested annually for impair- acquisition relates to the Biopharm segment. ment, irrespective of whether there is any indication that they may be impaired. Priority review voucher Assets that are subject to amortisation are reviewed for impairment whenever During 2018 Novo Nordisk acquired a priority review voucher which has been events or changes in circumstances indicate that the carrying amount may not fully amortised on notification and commitment to the FDA in December 2018 of be recoverable. Factors considered material that could trigger an impairment test the intent to use the Priority Review Voucher for the oral semaglutide New Drug include the following: Application (NDA) filing. The acquisition relates to the Diabetes and Obesity care segment. • Development of a competing drug • Changes in the legal framework covering patents, rights and licences Ziylo Ltd • Advances in medicine and/or technology that affect the medical treatments Novo Nordisk has acquired full rights to Ziylo's glucose binding molecule platform • Lower-than-predicted sales to develop glucose responsive insulins. The acquisition relates to the Diabetes and • Adverse impact on reputation and/or brand names Obesity care segment. • Changes in the economic lives of similar assets • Relationship to other intangible assets or property, plant and equipment • Changes or anticipated changes in participation rates or reimbursement policies. If the carrying amount of intangible assets exceeds the recoverable amount based on the existence of one or more of the above indicators of impairment, any impairment is measured based on discounted projected cash flows. Impairments are reviewed at each reporting date for possible reversal. Intangible assets DKK million 2019 2018 Patents and licences 4,627 3,858 Software 1,208 1,287 Total intangible assets 5,835 5,145 Novo Nordisk Annual Report 2019

Consolidated Financial Statements 56 3.1 Intangible assets (continued) Amortisation and impairment losses Amortisation and impairment losses In 2019, an impairment loss of DKK 982 million was recognised (no impairment DKK million 2019 2018 losses were recognised in 2018), substantially all of which related to patents and licences. DKK 282 million of the impairment was related to the Diabetes Cost of goods sold 916 208 and Obesity care segment and DKK 700 million of the impairment was related Sales and distribution costs 24 15 to Biopharm. Of the total impairment loss, DKK 529 million was recognised in Research and development costs 522 769 cost of goods sold and DKK 450 million in research and development costs. The Administrative costs 3 2 impairment was a result of Management’s review of projected future cash flows Other operating income, net 4 6 from marketable products and expectations related to patents and licences not yet in use. Total amortisation and impairment losses 1,469 1,000 The impairment losses related to marketable products were based on fair value Total amortisation 487 1,000 less cost of disposal calculations. The projected future cash flows were prepared Total impairment losses 982 — based on Management’s expectations for market access, market share and devel- opment in net sales prices. Management has used a post-tax discount rate of 7%. The inherent risk and uncertainty related to cash flows were adjusted for in the expected future cash flows. Intangible assets not yet in use amount to DKK 3,380 million (DKK 2,612 million in 2018), primarily patents and licences in relation to research and development projects. Impairment tests in 2019 and 2018 of patents and licences not yet in use are based on Management’s projections and anticipated net present value of estimated future cash flows from marketable products. Terminal values used are based on the expected life of products, forecasted life cycle and cash flow over that period, and the useful life of the underlying assets. 3.2 Property, plant and equipment Capital expenditure in the reported period was primarily related to investments in Novo Nordisk´s approach to managing operating assets is to retain assets for facility upgrades and new production facilities for active pharmaceutical ingredi- research, development and production activities under the company’s own control, ents for diabetes, mainly the facility in Clayton, US. The facility in Clayton will also and to lease non-core assets related to e.g. administration and distribution. be used for tableting and packing of oral products. Management believes this is a significant factor in maintaining the quality of the company´s products. Capital expenditure also related to new diabetes filling capacity in Hillerød. The facility will serve as a backup production facility for the US market and act as a Accounting policies launch site for new injectable diabetes products. Property, plant and equipment is measured at historical cost less accumulated depreciation and any impairment loss. The cost of self-constructed assets includes Finally, capital expenditure related to expansion of the facility in Chartres, France. costs directly and indirectly attributable to the construction of the assets. Any The investment will establish FlexTouch® assembly and packaging capacity at the subsequent cost is included in the asset’s carrying amount or recognised as a Chartres site. separate asset only when it is probable that future economic benefits associated with the item will flow to Novo Nordisk and the cost of the item can be measured Depreciation and impairment losses reliably. Depreciation is based on the straight-line method over the estimated DKK million 2019 2018 useful lives of the assets: Cost of goods sold 2,656 2,312 • Buildings: 12-50 years Sales and distribution costs 354 69 • Plant and machinery: 5-20 years Research and development costs 783 468 • Other equipment: 3-10 years Administrative costs 376 70 • Land: not depreciated. Other operating income, net 23 6 The depreciation commences when the asset is available for use, i.e. when it is Total depreciation and impairment losses 4,192 2,925 in the location and condition necessary for it to be capable of operating in the manner intended by Management. The assets’ residual values and useful lives are reviewed and adjusted, if appro- priate, at the end of each reporting period. If an asset’s carrying amount is higher than its estimated recoverable amount, it is written down to the recoverable amount. Plant and equipment with no alternative use developed as part of a research and development project are expensed. However, plant and equipment with an alter- native use or used for general research and development purposes are capitalised and depreciated over the estimated useful life as research and development costs. Novo Nordisk Annual Report 2019

Consolidated Financial Statements 57 3.2 Property, plant and equipment (continued) Property, plant and equipment Land and Plant and Other Assets under DKK million buildings machinery equipment construction Total 2019 Cost at the beginning of the year 25,401 25,412 4,779 16,846 72,438 Change in accounting policy, leases 3,291 — 487 — 3,778 Additions during the year 555 350 498 7,580 8,983 Disposals during the year (407) (504) (244) (74) (1,229) Transfer from assets under construction 1,277 2,248 665 (4,190) — Effect of exchange rate adjustment 143 88 30 189 450 Cost at the end of the year 30,260 27,594 6,215 20,351 84,420 Depreciation and impairment losses at the beginning of the year 9,770 17,871 2,906 — 30,547 Depreciation for the year 1,818 1,410 743 — 3,971 Impairment losses for the year 57 70 20 74 221 Depreciation and impairment losses reversed on disposals during the year (160) (504) (229) (74) (967) Effect of exchange rate adjustment 43 41 13 — 97 Depreciation and impairment losses at the end of the year 11,528 18,888 3,453 — 33,869 Carrying amount at the end of the year 18,732 8,706 2,762 20,351 50,551 2018 Cost at the beginning of the year 22,032 23,799 4,469 14,361 64,661 Additions during the year 222 365 175 8,775 9,537 Disposals during the year (267) (1,422) (178) — (1,867) Transfer from assets under construction 3,448 2,667 295 (6,410) — Effect of exchange rate adjustment (34) 3 18 120 107 Cost at the end of the year 25,401 25,412 4,779 16,846 72,438 Depreciation and impairment losses at the beginning of the year 8,934 17,808 2,672 — 29,414 Depreciation for the year 1,047 1,377 385 — 2,809 Impairment losses for the year 49 63 4 — 116 Depreciation and impairment losses reversed on disposals during the year (235) (1,346) (163) — (1,744) Effect of exchange rate adjustment (25) (31) 8 — (48) Depreciation and impairment losses at the end of the year 9,770 17,871 2,906 — 30,547 Carrying amount at the end of the year 15,631 7,541 1,873 16,846 41,891 3.3 Leases Accounting policies Novo Nordisk mainly leases office buildings, warehouses, laboratories and vehicles. The lease liability is initially measured at the present value of the lease payments outstanding at the commencement date, discounted using the incremental For contracts which are, or contain, a lease, the Group recognises a right-of-use borrowing rate. Lease payments consist of the following payments: asset and a lease liability. The right-of-use asset is initially measured at cost, being the initial amount of the lease liability. The right-of-use asset is subsequently • fixed payments from commencement date depreciated using the straight-line method over the lease term. The right-of-use • certain variable payments asset is periodically adjusted for certain remeasurements of the lease liability and • residual value guarantees or the exercise price of a purchase option reduced by any impairment losses. • termination penalties The lease term determined by the Group is the non-cancellable period of a lease, The lease liability is measured using the effective interest method. together with extension/termination option if these are reasonably certain to be exercised. The lease liability is remeasured when there is a change in future lease payments, typically due to a change in index or rate (e.g. inflation) on property leases, or When determining the term, Management considers multiple factors that create if there is a reassessment of whether an extension or termination option will be economic incentives to exercise an option to extend the lease or not to terminate exercised. A corresponding adjustment is made to the right-of-use asset, or in the the lease, including termination penalties, potential relocation costs and whether income statement when the right-of-use asset has been fully depreciated. significant leasehold improvements have been capitalised on the lease, with a remaining useful life which exceeds the fixed minimum duration of the lease. The right-of-use asset is presented in property, plant and equipment and the lease liability in borrowings. For contracts with a rolling term (evergreen leases), the Group estimates the leasing period to be equal to the termination period if no probable scenario exists for estimating the leasing period. Novo Nordisk Annual Report 2019

Consolidated Financial Statements 58 3.3 Leases (continued) New lease contracts with a lease term of 12 months or less and lease of low value Amounts recognised in the income statement assets are not recognised on the balance sheet. These are expensed on a straight- DKK million 2019 line basis over the lease term or another systematic basis. Lease of low value assets include personal computers, telephones and small items of office equipment. Depreciation 852 Interest on lease liabilities 108 Variable lease payments may depend on an index, a rate or other elements. Variable lease expenses 113 Variable lease payments that depend on an index or a rate are included in Short-term leases 201 the initial measurement of the lease liability using the index/rate at the lease Lease of low value assets 63 commencement date. Variable lease payments not based on an index or a rate are recognised as an expense in the income statement as incurred. Total amounts recognised in the income statement 1,337 Residual value guarantees that are expected to be paid are included in the initial measurement of the lease liability. Please refer to note 4.2. The lease costs for 2018 were DKK 1,299 million. As of 31 December 2019, the lease liability excludes DKK 2,760 million (undis- Amounts recognised in the cash flow statement counted) of potential lease payments related to lease term extension rights on DKK million properties, which were not considered reasonably certain to be exercised. Total cash outflow for leases 1,295 Property, plant and equipment presented in the balance sheet includes the following right-of-use assets. Please refer to note 4.2 for a maturity analysis of lease payments. Right-of-use assets in the balance sheet Land and Other DKK million buildings equipment Total 2019 Balance at 1 January 3,291 487 3,778 Additions during the year 333 307 640 Depreciation for the year (564) (288) (852) Other movements (31) (3) (34) Balance at 31 December 3,029 503 3,532 3.4 Inventories Accounting policies Inventories are stated at cost or net realisable value, whichever is lower. Cost is utilisation, production lead time, cost base and other relevant factors, hence determined using the first-in, first-out method. Cost comprises direct production inventory is valued at actual cost. When calculating total inventory, Management costs such as raw materials, consumables and labour as well as indirect production must make judgements about cost of production, standard cost variances and idle costs. Production costs for work in progress and finished goods include indirect capacity in estimating indirect production costs for capitalisation. Changes in the production costs such as employee costs, depreciation, maintenance, etc. parameters for calculation of indirect production costs could have an impact on the gross margin and the overall valuation of inventories. If the expected sales price less completion costs to execute sales (net realisable value) is lower than the carrying amount, a write-down is recognised for the Inventories amount by which the carrying amount exceeds its net realisable value. DKK million 2019 2018 Inventory manufactured prior to regulatory approval (prelaunch inventory) is capi- Raw materials 2,842 2,464 talised but immediately provided for, until there is a high probability of regulatory Work in progress 11,375 11,753 approval for the product. A write-down is made against inventory, and the cost Finished goods 4,850 4,078 is recognised in the income statement as research and development costs. Once there is a high probability of regulatory approval being obtained, the write-down Total inventories (gross) 19,067 18,295 is reversed, up to no more than the original cost. Write-downs at year-end (1,426) (1,959) In March 2019, Novo Nordisk filed oral semaglutide for US regulatory approval Total inventories (net) 17,641 16,336 of glycaemic control. Subsequent to filing, write-downs on prelaunch inventory Indirect production costs included in work in was reversed with a net positive income statement effect of DKK 510 million on progress and finished goods 9,216 8,533 research and development costs. Regulatory approval was obtained in September 2019. Share of total inventories (net) 52% 52% Movements in inventory write-downs Key accounting estimate of indirect production costs capitalised and Write-downs at the beginning of the year 1,959 2,219 inventory write-downs Write-downs during the year 414 509 Indirect production costs account for approximately 50% of the net inventory value, reflecting a lengthy production process compared with low direct raw Utilisation of write-downs (68) (409) material costs. The production of both Diabetes and Obesity care and Biopharm Reversal of write-downs (879) (360) products is highly complex from fermentation to purification and formulation, Write-downs at the end of the year 1,426 1,959 including quality control of all production processes. Furthermore, the process is very sensitive to manufacturing conditions. These factors all influence the parameters for capitalisation of indirect production costs at Novo Nordisk and the All write-downs in both 2018 and 2019 relate to fully impaired inventory. full cost of the products. Indirect production costs are measured using a standard Novo Nordisk Annual Report 2019 cost method. This is reviewed regularly to ensure relevant measures of capacity

Consolidated Financial Statements 59 3.5 Trade receivables Accounting policies Trade receivables Trade receivables are initially recognised at fair value and subsequently measured Gross Net at amortised cost using the effective interest method, less allowance for doubtful DKK million carrying Loss carrying trade receivables. 2019 amount allowance amount Not yet due 24,359 (763) 23,596 Before being sold, trade receivables in factoring portfolios are measured at fair 1-90 days 1,204 (127) 1,077 value with changes recognised in other comprehensive income. 91-180 days 261 (69) 192 The allowance for doubtful receivables is deducted from the carrying amount 181-270 days 96 (49) 47 of Trade receivables, and the amount of the loss is recognised in the income 271-360 days 79 (79) — statement under Sales and distribution costs. Subsequent recoveries of amounts More than 360 days past due 397 (397) — previously written off are credited against sales and distribution costs. Trade receivables 26,396 (1,484) 24,912 Novo Nordisk’s customer base comprises government agencies, wholesalers, retail pharmacies and other customers. Management makes allowance for doubtful Gross Net trade receivables based on the simplified approach to provide for expected credit DKK million carrying Loss carrying losses, which permits the use of the lifetime expected loss provision for all trade 2018 amount allowance amount receivables. The allowance is an estimate based on shared credit risk characteristics and the days past due. Generally, invoices are due for payment within 90 days of Not yet due 22,359 (692) 21,667 shipment of goods. 1-90 days 1,055 (111) 944 91-180 days 235 (79) 156 Loss allowance is calculated using an ageing factor, geographical risk and specific 181-270 days 60 (41) 19 customer knowledge. The allowance is based on a provision matrix on days past 271-360 days 76 (76) — due and a forward looking element relating mainly to incorporation of the Dun & More than 360 days past due 371 (371) — Bradstreet country risk rating and an individual assessment. Please refer to note 4.3 for a general description of credit risk. Trade receivables 24,156 (1,370) 22,786 Many of the countries within Region AAMEO have significant sales and low credit ratings. As such, this region has a relatively high impact on the allowance for Movements in allowance for doubtful trade receivables. doubtful trade receivables 2019 2018 Carrying amount at the beginning of the year 1,370 1,294 Novo Nordisk closely monitors the current economic conditions of countries impacted by currency fluctuations, high inflation and an unstable political climate. Reversal of allowance on realised losses (45) (25) These indicators as well as payment history are taken into account in the valuation Net movement recognised in income statement 158 164 of trade receivables. Please refer to note 2.2 for a geographical split of trade Effect of exchange rate adjustment 1 (63) receivables and allowance for doubtful trade receivables, and notes 4.3 and 4.8 for the trade receivable programmes. Allowance at the end of the year 1,484 1,370 Novo Nordisk Annual Report 2019

Consolidated Financial Statements 60 3.6 Retirement benefit obligations Accounting policies Net retirement benefit obligations Defined contribution plans 2019 2018 Novo Nordisk operates a number of defined contribution plans throughout the DKK million world. These plans are externally funded in entities that are legally separate from Retirement benefit obligations 2,508 2,488 the Group. Novo Nordisk’s contributions to the defined contribution plans are charged to the income statement in the year to which they relate. Fair value of plan assets 1,174 1,232 Net retirement benefit obligations at the end Defined benefit plans of the year 1,334 1,256 In a few countries, Novo Nordisk operates defined benefit plans, primarily located in the US, Germany, Switzerland and Japan. In Germany and Switzerland, the defined benefit plans are partly reimbursed by international insurance companies. The risk related to the plan assets in these countries is therefore limited to coun- The present value of partly funded retirement benefit obligations amounts to DKK terparty risk against these insurance companies. 1,845 million (DKK 1,841 million in 2018). The present value of unfunded retire- ment benefit obligations amounts to DKK 663 million (DKK 647 million in 2018). Recognition of defined benefit plans The costs for the year for defined benefit plans are determined using the projected Net remeasurement is a loss of DKK 187 million (gain of DKK 87 million in 2018), unit credit method. This reflects services rendered by employees to the valua- primarily related to changes in financial assumptions (discount rate), and is tion dates and is based on actuarial assumptions primarily regarding discount included in other comprehensive income. rates used in determining the present value of benefits and projected rates of remuneration growth. Discount rates are based on the market yields of high-rated Please refer to note 5.2 for a maturity analysis of the net retirement benefit obliga- corporate bonds in the country concerned. tion. Novo Nordisk does not expect the contributions over the next five years to differ significantly from current contributions. Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged or credited to other comprehensive income in Actuarial valuations are performed annually for all major defined benefit plans. the period in which they arise. Past service costs are recognised immediately in the Assumptions regarding future mortality are based on actuarial advice in income statement. accordance with published statistics and experience in each country. Other assumptions such as medical cost trend rate and inflation are also considered in Pension plan assets are only recognised to the extent that Novo Nordisk is able to the calculation. derive future economic benefits such as refunds from the plan or reductions of future contributions. Significant actuarial assumptions for the determination of the retirement benefit obligation (not considering plan assets) are discount rate and expected future Costs recognised for retirement benefits are included in cost of goods sold, sales remuneration increases. The sensitivity analysis below has been determined based and distribution costs, research and development costs, and administrative costs. on reasonably likely changes in the assumptions occurring at the end of the The total cost recognised for the year amounts to DKK 151 million (DKK 73 million period. in 2018). The sensitivities below consider the single change shown with the other The net obligation recognised in the balance sheet is reported as non-current assumptions assumed to be unchanged. The table shows the NPV impact of net liabilities. retirement liabilities. Key assumptions used for valuation and sensitivity analysis Key 1 %-point 1 %-point DKK million assumptions increase decrease 2019 Discount rate (decrease)/increase 1.3% (366) 465 Future remuneration growth (decrease)/increase 2.4% 105 (94) 2018 Discount rate (decrease)/increase 2.1% (369) 458 Future remuneration growth (decrease)/increase 2.5% 99 (89) Novo Nordisk Annual Report 2019

Consolidated Financial Statements 61 3.7 Provisions and contingent liabilities Accounting policies Novo Nordisk issues credit notes for expired goods as a part of normal business. Provisions for sales rebates and discounts granted to government agencies, Where there is historical experience or a reasonably accurate estimate of expected wholesalers, retail pharmacies, Managed Care and other customers are recorded future returns can otherwise be made, a provision for estimated product returns is at the time the related revenues are recorded or when the incentives are offered. recorded. The provision is measured at gross sales value. Provisions are calculated based on historical experience and the specific terms in the individual agreements. Unsettled rebates are recognised as provisions Key accounting estimate regarding ongoing legal disputes, litigation and when the timing or amount is uncertain. Where absolute amounts are known, investigations the rebates are recognised as other liabilities. Please refer to note 2.1 for further Provisions for legal disputes consist of various types of provision linked to ongoing information on sales rebates and provisions. legal disputes. Management makes estimates regarding provisions and contingen- cies, including the probability of pending and potential future litigation outcomes. Provisions for legal disputes are recognised where a legal or constructive obligation These are by nature dependent on inherently uncertain future events. When has been incurred as a result of past events and it is probable that there will be determining likely outcomes of litigation, etc. Management considers the input of an outflow of resources that can be reliably estimated. In this case, Novo Nordisk external counsels on each case, as well as known outcomes in case law. arrives at an estimate based on an evaluation of the most likely outcome. Disputes for which no reliable estimate can be made are disclosed as contingent liabilities. Although Management believes that the total provisions for legal proceedings are adequate based on currently available information, there can be no assurance Provisions are measured at the present value of the anticipated expenditure for that there will not be any changes in facts or matters, or that any future lawsuits, settlement. This is calculated using a pre-tax discount rate that reflects current claims, proceedings or investigations will not be material. market assessments of the time value of money and the risks specific to the obligation. The increase in the provision for interest is recognised as a financial expense. Provisions Provisions Provisions Provisions for sales for legal for product Other 2019 2018 DKK million rebates disputes returns provisions1 total total At the beginning of the year 25,760 1,860 869 1,064 29,553 24,057 Additional provisions, including increases to existing provisions 102,782 650 679 510 104,621 83,337 Amount used during the year (98,655) (4) (424) (161) (99,244) (79,243) Adjustments, including unused amounts reversed during the year 381 (156) (48) (29) 148 314 Effect of exchange rate adjustment 610 25 6 14 655 1,088 At the end of the year 30,878 2,375 1,082 1,398 35,733 29,553 Non-current liabilities2 551 2,375 300 1,387 4,613 3,392 Current liabilities 30,327 — 782 11 31,120 26,161 1. Other provisions consists of various types of provision, including obligations in relation to employee benefits such as jubilee benefits, company-owned life insurance, etc. 2. For non-current liabilities, provision for sales rebates is expected to be settled after one year, provisions for product returns will be utilised in 2021 and 2022. In the case of provisions for legal disputes, the timing of settlement cannot be determined. Contingent liabilities GLP-1/DPP-IV incretin-based products. 209 of the Novo Nordisk plaintiffs have also Novo Nordisk is currently involved in pending litigations, claims and investiga- named other defendants in their lawsuits. Most Novo Nordisk plaintiffs have filed tions arising out of the normal conduct of its business. While provisions that suit in California federal and state courts. Novo Nordisk does not currently have any Management deems to be reasonable and appropriate have been made for prob- individual trials scheduled in 2020. Novo Nordisk does not expect the pending claims able losses, there are uncertainties connected with these estimates. Novo Nordisk to have a material impact on its financial position, operating profit or cash flow. does not expect the pending litigations, claims and investigations, individually and in the aggregate, to have a material impact on Novo Nordisk’s financial position, Since January 2017, several class action lawsuits have been filed against Novo operating profit or cash flow in addition to the amounts accrued as provision for Nordisk, former CEO Lars Rebien Sørensen, former CFO Jesper Brandgaard and legal disputes. former President of Novo Nordisk Inc. Jakob Riis in the United States District Court for the District of New Jersey on behalf of all purchasers of Novo Nordisk Pending litigation against Novo Nordisk American Depositary Receipts between February 2015 and February 2017. All Novo Nordisk, along with the majority of incretin-based product manufacturers lawsuits have been consolidated into one case. The lawsuit alleges that Novo in the United States, is a defendant in product liability lawsuits related to use of Nordisk artificially inflated its financial results, failed to disclose pricing pressure incretin-based medications. As of 3 February 2020, 332 plaintiffs have named and rising rebate payments to PBMs, and made other materially misleading state- Novo Nordisk in product liability lawsuits, predominantly claiming damages for ments to potential investors. Novo Nordisk does not expect the litigation to have a pancreatic cancer that allegedly developed as a result of using Victoza® and other material impact on Novo Nordisk’s financial position, operating profit or cash flow. Novo Nordisk Annual Report 2019

Consolidated Financial Statements 62 3.7 Provisions and contingent liabilities (continued) In August 2019, a securities lawsuit was filed against Novo Nordisk in Denmark • Washington Attorney General’s Office CID (2017), relating to, among other by a number of institutional shareholders. The claim is for a total amount of things, pricing and trade practices for insulin products, including Levemir®, DKK 11.6 billion based on trading and holding of shares in Novo Nordisk during NovoLog®, and Novolin®, from 1 January 2005 through the present date. the period between February 2015 and February 2017. The lawsuit alleges • New Mexico Attorney General’s Office CID (2017), relating to, among other that Novo Nordisk made misleading statements and did not make appropriate things, trade practice and pricing of insulin products, namely NovoLog® and disclosures regarding its sales of insulin products in the US. It appears to contain Novolin® from 1 January 2012 through the present date. broadly similar allegations to those of the previously disclosed securities class • Texas Attorney General’s Office CID (2019), relating to, among other things, action lawsuit filed in the US in 2017 on behalf of all purchasers of Novo Nordisk marketing and promotional practices for Ozempic®. American Depository Receipts. Novo Nordisk does not expect the lawsuit to have a • New York State Attorney General’s Office Subpoena (2019), relating to, among material impact on Novo Nordisk’s financial position, operating profit or cash flow. other things, pricing and trade practices for insulin products, from 1 July 2013 through the present. Since January 2017, thirteen lawsuits, including several putative class actions, have • Colorado Attorney General’s Office CID (2019), relating to, among other things, been filed in various federal and state courts against Novo Nordisk Inc., Sanofi, Eli pricing and trade practices for insulin products, for the period from 1 January Lilly, and others relating to the pricing of diabetes medicines. Six of these lawsuits 2010 to present. were consolidated into one matter pending in the United States District Court for the District of New Jersey, yet one of these six lawsuits was later decon- In all matters Novo Nordisk is cooperating with the authority in question. Novo solidated and voluntarily dismissed without prejudice. Additionally, two of the Nordisk does not expect the above investigations to have a material impact on thirteen lawsuits were also voluntarily dismissed in 2019 and 2020. Accordingly, Novo Nordisk’s financial position, operating profit or cash flow. six lawsuits remain pending against Novo Nordisk in various jurisdictions. Three lawsuits are pending in the same New Jersey federal court as the consolidated Novo Nordisk is one of several pharmaceutical companies that received requests matter referenced above, while two other lawsuits are pending in other jurisdic- for information involving pricing practices for its diabetes products from several tions (Kentucky state court and Texas federal court). All pending matters allege committees of the Unites States House of Representatives and/or United States that the manufacturers and Pharmacy Benefit Managers (PBMs) colluded to Senate. Novo Nordisk is working with the staff of the various committees to artificially inflate list prices paid by consumers for diabetes products, while offering respond to their questions. Novo Nordisk does not expect the inquiries to have a reduced prices to PBMs through rebates used to secure formulary access. Novo material impact on Novo Nordisk’s financial position, operating profit or cash flow. Nordisk does not expect the lawsuits to have a material impact on Novo Nordisk’s financial position, operating profit or cash flow. Other contingent liabilities Pending claims against Novo Nordisk and investigations In addition to the above, the Novo Nordisk Group is engaged in certain litigation involving Novo Nordisk proceedings and various ongoing audits and investigations. In the opinion of Several authorities in the US have served Novo Nordisk with Civil Investigative Management, neither settlement or continuation of such proceedings, nor such Demands (CIDs) or subpoenas calling for the production of documents and infor- pending audits and investigations, are expected to have a material effect on Novo mation. Below is a list of ongoing matters: Nordisk’s financial position, operating profit or cash flow. • United States Department of Justice CID (2016) and Washington State Attorney General’s Office CID (2014 and 2016) both relating to, among other things, the promotion and marketing of NovoSeven®, interactions with physicians and patients, and the use of haemophilia-related patient support programmes. 3.8 Other liabilities Other liabilities primarily comprises employee cost payables, payables related to non-current assets and sales rebates. Novo Nordisk Annual Report 2019

Consolidated Financial Statements 63 Section 4 Capital structure and financial items 4.1 Share capital, distributions to shareholders and earnings per share Share capital A share B share Total share DKK million capital capital capital Development in share capital: Share capital 2016 107 403 510 Cancelled in 2017 — (10) (10) Cancelled in 2018 — (10) (10) Share capital at the beginning of the year 107 383 490 Cancelled in 2019 — (10) (10) Share capital at the end of the year 107 373 480 At the end of 2019, the share capital amounted to DKK 107 million in A share capital (equal to 537 million A shares of DKK 0.20) and DKK 373 million in B share capital (equal to 1,863 million B shares of DKK 0.20). Each A share carries 200 votes and each B share carries 20 votes. Cash distribution to shareholders Novo Nordisk paid out an interim dividend of DKK 3.00 per share in August 2019. The net cash distribution to shareholders in the form of dividends and share repurchases amounts to DKK 34.7 billion, compared with a free cash flow of DKK 34.5 billion. This is in line with the guiding principle of paying out excess capital to investors after funding organic growth and potential acquisitions. DKK million 2019 2018 2017 Interim dividend for the year 7,100 7,238 7,396 Dividend for prior year 12,309 11,810 11,448 Share repurchases for the year 15,334 15,567 16,845 Total 34,743 34,615 35,689 The total dividend for 2019 amounts to DKK 19,651 million (DKK 8.35 per share). The 2019 final dividend of DKK 12,551 million (DKK 5.35 per share) is expected to be distributed pending approval at the Annual General Meeting. The interim dividend of DKK 7,100 million (DKK 3.00 per share) was paid in August 2019. The total dividend for 2018 was DKK 19,547 million (DKK 8.15 per share), of which the final dividend of DKK 12,309 million (DKK 5.15 per share) was paid in March 2019. No dividend is declared on treasury shares. According to Danish corporate law, reserves available for distribution as dividends are based on the financial statements of the parent company, Novo Nordisk A/S. Dividends are paid from distributable reserves. Share premium is a distributable reserve and any former share premium reserve has been fully distributed. As at 31 December 2019, distributable reserves total DKK 40,801 million (2018: DKK 38,816 million), corresponding to the parent company's retained earnings. Treasury shares Accounting policies Treasury shares are deducted from the share capital on cancellation at their nominal value of DKK 0.20 per share. Differences between this amount and the amount paid to acquire or received for disposing of treasury shares are deducted directly in Equity. 2019 2018 As % of Number of Number of As % of share share B shares B shares Market value, capital before capital after of DKK 0.20 of DKK 0.20 DKK million cancellation cancellation (million) (million) Holding at the beginning of the year 16,610 2.3% 56 56 Cancellation of treasury shares (14,895) (2.0%) (50) (50) Transfer regarding restricted stock units (762) (3) (1) Purchase during the year 15,334 45 51 Value adjustment 2,326 — — Holding at the end of the year 18,613 2.0% 48 56 Treasury shares are primarily acquired to reduce the company’s share capital. In addition, a limited part is used to finance Novo Nordisk’s long-term share-based incentive programme (restricted stock units) and restricted stock units to employees. Novo Nordisk Annual Report 2019

Consolidated Financial Statements 64 4.1 Share capital, distributions to shareholders and earnings per share (continued) Novo Nordisk’s guiding principle is that any excess capital, after the funding of organic growth opportunities and potential acquisitions, should be returned to investors. Novo Nordisk’s dividend payouts are complemented by share repurchase programmes. The purchase of treasury shares during the year relates to the remaining part of the 2018 share repurchase programme, totalling DKK 1.2 billion and the DKK 15 billion Novo Nordisk B share repurchase programme for 2019, of which DKK 0.9 billion was outstanding at year-end. The programme ended on 3 February 2020. Transfer of treasury shares relates to the long-term share-based incentive programme and restricted stock units to employees. Earnings per share Accounting policies Earnings per share is presented as both basic and diluted earnings per share. Basic earnings per share is calculated as net profit divided by the average number of shares outstanding. Diluted earnings per share is calculated as net profit divided by the sum of average number of shares outstanding, including the dilutive effect of the outstanding share pool. Please refer to ‘Financial definitions’ for a description of calculation of the dilutive effect. DKK million 2019 2018 2017 Net profit for the year 38,951 38,628 38,130 Average number of shares outstanding in 1,000 shares 2,374,299 2,419,603 2,473,218 Dilutive effect of average outstanding share pool1 in 1,000 shares 4,359 4,814 4,875 Average number of shares outstanding, including dilutive effect of outstanding share pool in 1,000 shares 2,378,658 2,424,417 2,478,093 Basic earnings per share DKK 16.41 15.96 15.42 Diluted earnings per share DKK 16.38 15.93 15.39 1. For further information on the outstanding share pool, please refer to note 5.1. 4.2 Borrowings Contractual undiscounted cashflows Bank DKK million Leases overdrafts1 Total 2019 Within 1 year 847 659 1,506 1-3 years 1,424 — 1,424 3-5 years 734 — 734 More than 5 years 1,140 — 1,140 Total contractual undiscounted cash flows at the end of the year 4,145 659 4,804 Contractual discounted cash flows included in the balance sheet at the end of the year 3,824 659 4,483 Non-current liabilities 3,009 — 3,009 Current liabilities 815 659 1,474 1. Bank overdrafts includes DKK 595 million classified as financing activities (2018: DKK 506 million) and DKK 64 million classified as cash and cash equivalents (2018: DKK 9 million). Reconciliation of liabilities arising from financing activities Non-cash movements Beginning Exchange End of the DKK million of the year Cash flows Additions Disposals rates Other year 2019 Lease liabilities 3,988 (822) 640 (57) 63 12 3,824 Bank overdrafts 506 81 — — 8 — 595 Liabilities arising from financing activities 4,494 (741) 640 (57) 71 12 4,419 Bank overdrafts 9 55 — — — — 64 Total borrowings 4,503 (686) 640 (57) 71 12 4,483 Novo Nordisk Annual Report 2019

Consolidated Financial Statements 65 4.3 Financial risks Novo Nordisk has centralised management of the Group’s financial risks. The Key currencies overall objectives and policies for the company’s financial risk management are Exchange rate DKK per 100 2019 2018 2017 outlined in an internal Treasury Policy, which is approved by the Board of Directors. The Treasury Policy consists of the Foreign Exchange Policy, the Investment USD Policy, the Financing Policy and the policy regarding Credit Risk on Financial Average 667 631 660 Counterparts, and includes a description of permitted use of financial instruments Year-end 668 652 621 and risk limits. Year-end change 2.5% 5.1% (12.0%) Novo Nordisk only hedges commercial exposures and consequently does not enter CNY into derivative transactions for trading or speculative purposes. Novo Nordisk uses Average 97 95 98 a fully integrated Treasury Management System to manage all financial positions, Year-end 96 95 95 and all positions are marked-to-market. Management has assessed the following Year-end change 1.1% (0.3%) (6.9%) key financial risks: JPY Type Financial risk Average 6.12 5.72 5.88 Year-end 6.11 5.91 5.51 Foreign exchange risk High Year-end change 3.4% 7.3% (8.6%) Interest rate risk Low Liquidity risk Low CAD Credit risk Low Average 503 487 508 Year-end 511 479 495 Year-end change 6.7% (3.2%) (5.5%) Foreign exchange risk Foreign exchange risk is the most important financial risk for Novo Nordisk and GBP can have a significant impact on the income statement, statement of comprehen- Average 852 842 849 sive income, balance sheet and cash flow statement. Year-end 877 827 839 The overall objective of foreign exchange risk management is to reduce the short- Year-end change 6.0% (1.4%) (3.5%) term negative impact of exchange rate fluctuations on earnings and cash flow, thereby contributing to the predictability of the financial results. Foreign exchange sensitivity analysis The majority of Novo Nordisk’s sales are in USD, EUR, CNY, JPY, CAD and GBP. A 5% increase/decrease in the year-end rate in the following currencies versus EUR The foreign exchange risk is most significant in USD, CNY and JPY, while the EUR and DKK would impact Novo Nordisk’s operating profit estimated by Management exchange rate risk is regarded as low because of Denmark’s fixed exchange rate as outlined in the table below: policy towards EUR. Estimated for Novo Nordisk hedges existing assets and liabilities in key currencies as well as DKK million 2020 2019 future expected cash flows up to a maximum of 24 months forward. Hedge accounting is applied to match the impact of the hedged item and the hedging USD 1,950 2,000 instrument in the consolidated income statement. Management has chosen to CNY 450 350 classify the result of hedging activities as part of financial items. JPY 150 160 CAD 130 90 During 2019, the hedging horizon varied between 6 and 13 months for USD, GBP 100 85 CNY, JPY, CAD and GBP. The currency hedging strategy balances risk reduction and cost of hedging by use of foreign exchange forwards and foreign exchange options matching the due dates of the hedged items. Expected cash flows are At year-end, a 5% immediate increase/decrease in all other currencies versus EUR continually assessed using historical inflows, budgets and monthly sales forecasts. and DKK would affect other comprehensive income and the income statement as Hedge effectiveness is assessed on a regular basis. There is no expected ineffec- outlined in the table below: tiveness at 31 December 2019, primarily because hedging instruments match 5% increase 5% decrease currencies of hedged cash flows. in all other in all other currencies currencies The financial contracts existing at year-end cover the expected future cash flow for against against the following number of months: DKK million DKK and EUR DKK and EUR 2019 2018 2019 USD 9 months 11 months Other comprehensive income (1,811) 1,811 CNY1 7 months 6 months Income statement 199 (199) JPY 12 months 12 months CAD 9 months 9 months Total (1,612) 1,612 GBP 10 months 11 months 2018 Other comprehensive income (1,988) 1,988 1. Chinese yuan traded offshore (CNH) is used to hedge Novo Nordisk’s CNY currency exposure. Income statement 115 (115) Total (1,873) 1,873 A 5% depreciation of USD against all other currencies at 31 December 2019 would affect equity by DKK 1,298 million (2018: DKK 1,604 million) and the income statement by DKK 135 million (2018: DKK 157 million). The foreign exchange sensitivity analysis comprises effects from the Group’s cash, trade receivables and trade payables, current loans, current and non-current financial investments, lease liabilities, foreign exchange forwards and foreign Novo Nordisk Annual Report 2019 exchange options at year-end. Anticipated currency transactions, investments and non-current assets are not included.

Consolidated Financial Statements 66 4.3 Financial risks (continued) Interest rate risk Novo Nordisk has no significant exposure to interest rate risk as it does not hold Outside the US, Novo Nordisk has no significant concentration of credit risk any significant interest-bearing marketable securities or non-current loans. related to trade receivables or other receivables and prepayments, as the exposure in general is spread over a large number of counterparties and customers. In the Liquidity risk US, the three major wholesalers account for a large proportion of total net sales, The liquidity risk is considered to be low, and Novo Nordisk has limited debt cf. note 2.2. However, US wholesaler credit ratings are monitored and a large financing. Novo Nordisk ensures the availability of the required liquidity through proportion of the trade receivables are sold on full non-recourse terms; see below a combination of cash management, highly liquid investment portfolios and both for details. Novo Nordisk continues to monitor the credit exposure in Region uncommitted and committed credit facilities. Novo Nordisk uses cash pools for AAMEO due to the increasing sales and low credit ratings of many countries in optimisation and centralisation of cash management. this region. Credit risk Credit risk arises from the possibility that transactional counterparties may Trade receivable programmes default on their obligations, causing financial losses for the Group. Novo Nordisk Please refer to note 3.5 for the description of the loss allowance for the Group considers its maximum credit exposure to financial counterparties to be DKK and the ageing analysis. 15,663 million (2018: DKK 15,842 million). In addition, Novo Nordisk considers its maximum credit exposure to trade receivables, other receivables (less prepayments Novo Nordisk’s subsidiaries in the US and Japan employ trade receivable and VAT receivables) and other financial assets to be DKK 26,622 million (2018: programmes in which trade receivables are sold on full non-recourse terms to DKK 25,065 million). Please refer to note 4.8 for details of the Group’s total optimise working capital. financial assets. At year-end, the Group had derecognised receivables without recourse having due To manage credit risk regarding financial counterparties, Novo Nordisk only enters dates after 31 December 2019 amounting to: into derivative financial contracts and money market deposits with financial counterparties possessing a satisfactory long-term credit rating from at least two DKK million 2019 2018 2017 out of the three selected ratings agencies: Standard and Poor’s, Moody’s and Fitch. Furthermore, maximum credit lines defined for each counterparty diversify the US 3,672 3,587 3,328 overall counterparty risk. The table below shows Novo Nordisk’s credit exposure Japan 2,149 1,937 2,024 on cash and financial derivatives. Credit exposure for cash at bank and derivative financial instruments In addition, full non-recourse off-balance sheet factoring arrangement (market value) programmes are occasionally applied by Novo Nordisk subsidiaries around the Derivative world, with limited impact on the Group’s trade receivables. Cash at financial DKK million bank instruments Total Please refer to note 2.2 for the split of allowance for trade receivables by geographical segment. 2019 AA-range 7,471 139 7,610 A-range 7,145 49 7,194 BBB-range 314 — 314 Not rated or below BBB-range 545 — 545 Total 15,475 188 15,663 2018 AA-range 7,989 90 8,079 A-range 7,212 114 7,326 BBB-range 246 — 246 Not rated or below BBB-range 191 — 191 Total 15,638 204 15,842 Novo Nordisk Annual Report 2019

Consolidated Financial Statements 67 4.4 Derivative financial instruments Accounting policies Discontinuance of cash flow hedging Novo Nordisk uses financial instruments to reduce the impact of foreign exchange When a hedging instrument expires or is sold, or when a hedge no longer meets on financial results. the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognised when the forecast transaction is Use of derivative financial instruments ultimately recognised in the income statement. When a forecast transaction is no The derivative financial instruments are used to manage the exposure to market longer expected to occur, the cumulative gain or loss that was reported in equity risk. None of the derivatives are held for trading. is immediately transferred to the income statement under financial income or financial expenses. Novo Nordisk uses forward exchange contracts and, to a lesser extent, currency options to hedge forecast transactions, assets and liabilities. The overall policy is to Fair value determination hedge the majority of total currency exposure. The fair value of derivative financial instruments is measured on the basis of quoted market prices of financial instruments traded in active markets. If an active Net investments in foreign subsidiaries are currently not hedged. market exists, the fair value is based on the most recently observed market price at the end of the reporting period. Initial recognition and measurement On initiation of the contract, Novo Nordisk designates each derivative financial If a financial instrument is quoted in a market that is not active, Novo Nordisk contract that qualifies for hedge accounting as one of: bases its valuation on the most recent transaction price. • hedges of the fair value of a recognised asset or liability (fair value hedge) Adjustment is made for subsequent changes in market conditions, for instance by • hedges of the fair value of a forecast financial transaction (cash flow hedge). including transactions in similar financial instruments assumed to be motivated by normal business considerations. All contracts are initially recognised at fair value and subsequently remeasured at fair value at the end of the reporting period. If an active market does not exist, the fair value of standard and simple financial instruments, such as foreign exchange forward contracts, interest rate swaps, Fair value hedges currency swaps and unlisted bonds, is measured according to generally accepted Value adjustments of fair value hedges are recognised in the income statement valuation techniques. Market-based parameters are used to measure the fair along with any value adjustments of the hedged asset or liability that are attribut- value. able to the hedged risk. Cash flow hedges Value adjustments of the effective part of cash flow hedges are recognised directly in other comprehensive income. The cumulative value adjustment of these contracts is transferred from other comprehensive income to the income state- ment when the hedged transaction is recognised in the income statement. Derivative financial instruments 2019 2018 Contract Positive Negative Contract Positive Negative amount fair value fair value amount fair value fair value DKK million at year-end at year-end at year-end at year-end at year-end at year-end Forward contracts USD1 25,394 81 315 29,951 21 1,555 Forward contracts CNH, JPY, GBP and CAD 10,013 35 130 7,462 23 166 Forward contracts, cash flow hedges 35,407 116 445 37,413 44 1,721 Forward contracts USD 11,287 61 217 9,145 123 256 Forward contracts CNH, CAD, EUR, GBP and JPY 3,761 11 72 3,268 37 47 Forward contracts, fair value hedges 15,048 72 289 12,413 160 303 Total derivative financial instruments 50,455 188 734 49,826 204 2,024 Recognised in the income statement 72 289 160 303 Recognised in other comprehensive income 116 445 44 1,721 1. Average hedge rate for USD cash flow hedges is 654 at the end of 2019 and 610 at the end of 2018. The above financial contracts are expected to impact the income statement within the next 12 months, with deferred gains and losses on cash flow hedges then being transferred to financial income or financial expenses. Novo Nordisk Annual Report 2019

Consolidated Financial Statements 68 4.5 Cash and cash equivalents, financial resources and DKK million 2019 2018 2017 free cash flow Cash and cash equivalents Cash at bank (note 4.3) 15,475 15,638 18,852 Borrowings (bank overdrafts)1 (64) (9) (1,694) Accounting policies The cash flow statement shows how income and changes in balance sheet items Cash and cash equivalents 15,411 15,629 17,158 affect cash and cash equivalents, in other words the cash generated or used in the Financial resources period. Cash and cash equivalents 15,411 15,629 17,158 2 The cash flow statement is presented in accordance with the indirect method Undrawn committed credit facility 11,578 11,574 8,190 commencing with net profit for the year. Cash flows in foreign currencies are Borrowings (bank overdrafts)1 (595) (506) — translated to DKK at the average exchange rate for the respective year. Financial resources3 26,394 26,697 25,348 Cash from operating activities converts income statement items from the accrual basis of accounting to cash basis. As such, starting with net profit, non-cash 1. Cash and cash equivalents at the beginning of 2018 has been adjusted for a DKK 412 items are reversed and actual payments included. The change in working capital million bank loan reclassified to financing activities. At 31 December 2019 bank overdrafts classified as financing activities totalled DKK 595 million (2018: DKK 506 million). is also taken into account, as this shows the development in money tied up in 2. The undrawn committed credit facility in 2019 is a EUR 1,550 million facility (EUR 1,550 the balance sheet. Cash from investing activities shows payments related to the million in 2018 and EUR 1,100 million in 2017) committed by a portfolio of international purchase and sale of Novo Nordisk’s long-term investments. This includes fixed banks. The facility matures in 2024. assets such as construction of new production sites, intangible assets such as 3. Additional non-IFRS financial measure; please refer to 'Financial definitions', which is not part of the audited financial statements. patents and licences, and financial assets. Free cash flow Cash and cash equivalents consists of cash offset by short-term bank loans. Where DKK million 2019 2018 2017 short-term bank loans are consistently overdrawn, they are excluded from cash and cash equivalents. The movement in such facilities is presented under financing Net cash generated from 1 activities in the cash flow statement . Financial resources consist of cash and cash operating activities 46,782 44,616 41,168 equivalents, marketable securities with original maturity of less than three months Net cash used in investing activities (11,509) (12,080) (6,571) and undrawn committed credit facilities expiring after more than one year. Net purchase of marketable securities — — (2,009) Restricted cash Cash and cash equivalents at 31 December 2019 includes DKK 509 million that is Repayment on lease liabilities (822) — — restricted (2018: DKK 120 million). The restricted cash balance relates to subsidi- Free cash flow4 34,451 32,536 32,588 aries in which availability of currency for remittance of funds is temporarily scarce. 4. Additional non-IFRS financial measure; please refer to 'Financial definitions', which is not part of the audited financial statements. 4.6 Change in working capital 4.7 Other non-cash items Accounting policies For the purpose of presenting the cash flow statement, non-cash items with effect Working capital is defined as current assets less current liabilities and measures the on the income statement must be reversed to identify the actual cash flow effect liquid assets Novo Nordisk has available for the business. from the income statement. The adjustments are specified as follows: Change in working capital Other non-cash items DKK million 2019 2018 2017 DKK million 2019 2018 2017 Inventories (1,305) (963) (1,032) Reversals of non-cash income Trade receivables (2,126) (2,621) 69 statement items Other receivables and prepayments1 (1,190) (662) (17) Interest income and interest Trade payables (398) 1,146 (401) expenses, net (note 4.9) 155 34 21 Other liabilities1 1,202 (348) 265 Capital gain/(loss) on investments, Adjustment for payables related to net etc (note 4.9) 145 (163) 25 non-current assets 295 84 (1,143) Result of associated company (note Adjustment related to divestment of 4.9) 137 (12) (14) group companies (42) — — Share-based payment costs (note 5.1) 363 414 292 Change in working capital Income from the divestment of including exchange rate group companies (68) (122) — adjustments (3,564) (3,364) (2,259) Adjustment in non-cash items Exchange rate adjustments 176 (6) (1,375) related to divestment of group companies 162 — — Cash flow change in working Increase/(decrease) in provisions capital (3,388) (3,370) (3,634) (note 3.7) and retirement benefit obligations 6,071 5,503 214 1. Change in working capital includes adjustments in respect of implementation of IFRS 16, Other 67 444 1,489 please refer to note 1.2. Total other non-cash items 7,032 6,098 2,027 Novo Nordisk Annual Report 2019

Consolidated Financial Statements 69 4.8 Financial assets and liabilities Financial assets 'at fair value through the income statement' Financial assets at fair value through the income statement consist of equity investments and forward exchange contracts. Equity investments are included in Accounting policies other financial assets unless management intends to dispose of the investment The implementation of IFRS 9 from 1 January 2018 resulted in changes to the within 12 months of the end of the reporting period. In that case, the current part classification of financial assets. Key changes from the application of IFRS 9 were: is included in other receivables and prepayments. From 1 January 2018, Novo Nordisk's investments in minor shareholdings are Net gains and losses arising from changes in the fair value of financial assets are measured and classified as fair value through the income statement (previously recognised in the income statement as financial income or expenses. measurement was at fair value through other comprehensive income). The fair values of quoted investments are based on current bid prices at the end of From 1 January 2018, all financial assets previously categorised as loans and the reporting period. Financial assets for which no active market exists are carried receivables are classified as financial assets at amortised cost with the exception at fair value based on a valuation methodology. of certain portfolios of trade receivables which are either sold under master factoring agreements or collected from the customer. These specific portfolios of Financial assets 'at amortised cost' trade receivables are separately classified and measured at fair value through other Financial assets at amortised cost are cash at bank and non-derivative financial assets comprehensive income. solely with payments of principal and interest. Novo Nordisk normally 'holds-to-col- lect' the financial assets to attain the contractual cash flows. If collection is expected Depending on purpose, Novo Nordisk classifies investments into the following categories: within one year (or in the normal operating cycle of the business if longer), they are • Financial assets at fair value through the income statement classified as current assets. If not, they are presented as non-current assets. • Financial assets at amortised cost • Financial assets at fair value through OCI Trade receivables and other receivables are recognised initially at fair value. Subsequently they are measured at amortised cost using the effective interest Management determines the classification of its financial assets on initial recogni- method, less allowance for doubtful receivables. tion and re-evaluates this at the end of every reporting period to the extent that such a classification is permitted or required. Financial assets 'at fair value through other comprehensive income' Financial assets at fair value through other comprehensive income are trade receiv- Recognition and measurement ables that are held to collect or to sell in factoring agreements. Purchases and sales of financial assets are recognised on the settlement date. These are initially recognised at fair value. Financial liabilities 'at fair value through the income statement' Financial liabilities at fair value through the income statement consist of forward Fair value disclosures are made separately for each class of financial instruments at exchange contracts. the end of the reporting period. Financial liabilities 'at amortised cost' Financial assets are removed from the balance sheet when the rights to receive Financial liabilities at amortised cost consist of bank overdrafts, trade payables and cash flows have expired or have been transferred, and Novo Nordisk has trans- other liabilities. ferred substantially all the risks and rewards of ownership. Financial assets by category DKK million 2019 2018 Financial assets at fair value through the income statement 1,158 969 Other financial assets1 970 765 Derivative financial instruments (note 4.4) 188 204 Financial assets at amortised cost 28,418 28,340 Other financial assets1 364 477 Trade receivables (note 3.5)2 12,203 11,188 Other receivables and prepayments (current and non-current) 4,275 3,090 - less prepayments and VAT receivables (3,899) (2,053) Cash at bank (note 4.5) 15,475 15,638 Financial assets at fair value through OCI 12,709 11,598 Trade receivables in a factoring portfolio (note 3.5)2 12,709 11,598 Total financial assets at the end of the year by category1 42,285 40,907 1. Financial assets with the exception of other financial assets and non-current part of other receivables and prepayments (DKK 841 million) are all due within one year. Other financial assets at amor- tised cost include DKK 327 million which are due in more than 5 years (2018: DKK 377 million). Other financial assets measured at fair value through the income statement are minor shareholdings. 2. Trade receivables which are measured at fair value through OCI, which have no associated loss allowance. Financial liabilities by category DKK million 2019 2018 Financial liabilities measured at fair value through the income statement 734 2,024 Derivative financial instruments (note 4.4) 734 2,024 Financial liabilities measured at amortised cost 25,448 20,936 Borrowings (non-current) 3,009 — Borrowings (current) 1,474 515 Trade payables 6,358 6,756 Other liabilities 15,085 14,098 - less VAT and duties payable (478) (433) Total financial liabilities at the end of the year by category3 26,182 22,960 3. Please refer to note 4.2 for a maturity analysis for non-current and current borrowings. All other financial liabilities are due within one year. Novo Nordisk Annual Report 2019

Consolidated Financial Statements 70 4.8 Financial assets and liabilities (continued) For a description of the credit quality of financial assets such as trade receivables, cash at bank, marketable securities, current debt and derivative financial instruments, refer to notes 4.3 and 4.4. Fair value measurement hierarchy DKK million 2019 2018 Active market data 846 649 Directly or indirectly observable market data 188 204 Not based on observable market data1 12,833 11,714 Total financial assets at fair value 13,867 12,567 Active market data — — Directly or indirectly observable market data 734 2,024 Not based on observable market data — — Total financial liabilities at fair value 734 2,024 1. The fair value of trade receivables in a factoring portfolio is calculated based on the net invoice amount (invoice amount less charge-backs) less the fee payable to the factoring entity. The factoring fee is insignificant due to the short period between the time of sale to the factoring entity and the invoice due date and the rate applicable. Inputs to the estimate of US wholesaler charge-backs are described in note 2.1. Financial assets and liabilities measured at fair value can be categorised using the fair value measurement hierarchy above. There were no transfers between the ’Active market data’ and ’Directly or indirectly observable market data’ categories during 2019, 2018 or 2017. There are no significant intangible assets or items of property, plant and equipment measured at fair value. 4.9 Financial income and expenses Accounting policies Financial impact from forward contracts and currency options, specified As described in note 4.3, Management has chosen to classify the result of DKK million 2019 2018 2017 hedging activities as part of financial items in the income statement. Financial items primarily relate to foreign exchange elements and are mainly impacted Forward contracts by the cumulative value adjustment of cash flow hedges transferred from other Income/(loss) transferred from other comprehensive income to the income statement when the hedged transaction is comprehensive income (1,677) 1,841 (2,016) recognised in the income statement. In addition, value adjustments of fair value Value adjustment of transferred hedges are recognised in financial income and financial expenses along with contracts (1,609) (1,299) 2,477 any value adjustments of the hedged asset or liability that are attributable to the Unrealised fair value adjustments of hedged risk. Finally, value adjustments of foreign currency assets and liabilities in forward contracts (217) (143) 116 non-hedged currencies will impact financial income and financial expenses. Realised foreign exchange gain/ (loss) on forward contracts 830 1,257 (1,923) Financial income DKK million 2019 2018 2017 Financial income/(expense) from forward contracts (2,673) 1,656 (1,346) Interest income1 65 51 69 Foreign exchange gain (net) — — 1,163 Currency options Financial gain from forward con- Realised income/(loss) transferred tracts (net) — 1,656 — from other comprehensive income — 186 61 Financial gain from currency options Value adjustment of transferred (net) — 152 — options — (3) (9) Capital gain on investments, etc. — 251 — Foreign exchange gain/(loss) on Result of associated companies — 12 14 currency options — (31) (56) Total financial income 65 2,122 1,246 Financial income/(expense) from currency options — 152 (4) Financial expenses DKK million 2019 2018 2017 Interest expenses1 220 85 90 Foreign exchange loss (net) 539 1,510 — Financial loss from forward con- tracts (net) 2,673 — 1,346 Financial loss from currency options (net) — — 4 Capital loss on investments, etc. 145 88 25 Result of associated companies 137 — — Other financial expenses 281 72 68 Total financial expenses 3,995 1,755 1,533 Novo Nordisk Annual Report 2019 1. Total interest income and expenses is measured at amortised cost for financial assets and liabilities.

Consolidated Financial Statements 71 Section 5 Other disclosures 5.1 Share-based payment schemes Accounting policies Long-term share-based incentive programme Share-based compensation Novo Nordisk operates equity-settled, share-based compensation plans. Management Board The fair value of the employee services received in exchange for the grant of On 4 February 2020, the Board of Directors approved the allocation of a total of shares is recognised as an expense and allocated over the vesting period. 508,398 Novo Nordisk B shares to the members of the Management Board for the 2019 financial year. The value at launch of the programme (adjusted for expected The total amount to be expensed over the vesting period is determined by dividends) was DKK 152 million. On average, this corresponds to 14.7 months’ reference to the fair value of the shares granted, excluding the impact of any fixed base salary plus pension contribution for the CEO, 11.0 months’ fixed base non-market vesting conditions. The fair value is fixed at the grant date, and salary plus pension contribution per executive vice president as of 1 March 2019 adjusted for expected dividends during the vesting period. Non-market vesting and 8.2 months’ fixed base salary plus pension for senior vice presidents. The conditions are included in assumptions about the number of shares that are cost of the 2019 programme is amortised over the vesting period of 2019-2022 expected to vest. At the end of each reporting period, Novo Nordisk revises its at an annual amount of DKK 38 million. The amount of shares allocated may be estimates of the number of shares expected to vest. Novo Nordisk recognises the reduced or increased by up to 30%, depending on whether the average sales impact of the revision of the original estimates, if any, in the income statement growth per year in the three-year vesting period deviates from a target set by the and in a corresponding adjustment to equity (change in proceeds) over the Board of Directors. remaining vesting period. Adjustments relating to prior years are included in the income statement in the year of adjustment. The grant date of the programme was February 2019, and the share price used for the determining the grant date fair value of the award was the average share Share-based payment price (DKK 322) for Novo Nordisk B shares on Nasdaq Copenhagen in the period 1-15 February 2019, adjusted for expected dividend. Based on the split of partici- pants when the share allocation was decided, 43% of the allocated shares will be Expensed in the income statement allocated to members of Executive Management and 57% to other members of DKK million 2019 2018 2017 the Management Board. Restricted stock units to employees 48 204 169 Long-term share-based incentive The shares allocated to the joint pool for 2016 were released to the individual programme (Management Board)1 86 48 19 participants subsequent to approval of the 2019 Annual Report by the Board of Directors and after the announcement of the 2019 full-year financial results on Long-term share-based incentive pro- 5 February 2020. The shares allocated correspond to a value at launch of the gramme (management group below programme of DKK 29 million, expensed in 2016. Management Board) 195 145 102 Shares allocated to individual Management group below Management Board employees 34 17 2 The management group below the Management Board has a share-based incen- tive programme with similar performance criteria. For 2019, a total of 1,300,333 Share-based payment expensed shares were allocated to this group, corresponding to a value at launch of the in the income statement 363 414 292 programme (adjusted for expected dividends) of DKK 387 million. The cost of the 2019 programme is amortised over the vesting period of 2019-2022 at an annual 1. In 2017 Novo Nordisk introduced, for the first time, a share-based compensation pro- amount of DKK 97 million. The amount of shares allocated may be reduced or gramme with terms which amortises the grant date valuation over four years. The 2019 increased by up to 30%, depending on whether the average sales growth per expense includes amortisation of the 2017, 2018 and 2019 programmes. year in the three-year vesting period deviates from a target set by the Board of Directors. Restricted stock units to employees The shares allocated for 2016 were released to the individual participants subse- In appreciation of the efforts of employees during recent years, as of 1 August quent to approval of the 2019 Annual Report by the Board of Directors and after 2019, all employees in the company were offered 75 restricted stock units. A the announcement of the 2019 full-year financial results on 5 February 2020. restricted stock unit gives the holder the right to receive one Novo Nordisk B share The shares allocated correspond to a value at launch of the programme of DKK free of charge in February 2023 subject to continued employment. The cost of the 68 million amortised over the period 2016-2019. The number of shares to be DKK 660 million programme is amortised over the vesting period. transferred (174,481 shares) is lower than the original number of shares allocated, as some participants had left the company before the programme’s release condi- tions were met. Novo Nordisk Annual Report 2019

Consolidated Financial Statements 72 5.1 Share-based payment schemes (continued) General terms and conditions of launched programmes Shares for Management group below Restricted stock units to employees Shares for Management Board Management Board 2019 2018 2017 2019 2018 2017 2019 2018 2017 Number of shares awarded in the year 2,148,580 — — 508,398 411,090 356,195 1,300,333 1,114,455 761,826 Value per share at launch (DKK) 307 — — 298 280 213 298 280 213 Vesting period 3.5 years — — 3 years 3 years 3 years 3 years 3 years 3 years Allocated to recipients Feb 2023 Feb 2023 Feb 2022 Feb 2021 Feb 2023 Feb 2022 Feb 2021 Total market value at launch (DKK million) 660 — — 152 115 76 387 312 162 Amortisation period of 2019 to 2019 to 2018 to 2017 to 2019 to 2018 to 2017 to the programme 2023 — — 2022 2021 2020 2022 2021 2020 Outstanding restricted stock units 2019 2018 Outstanding at the beginning of the year 5,584,019 4,833,882 Released restricted stock units to employees (1,431,192) (35,180) Released shares allocated to Management in 2015 (1,040,593) (764,474) Released shares allocated to individual employees (81,873) (25,883) Cancelled allocated shares (262,596) (209,308) Allocated restricted stock units to employees 2,148,580 100,000 Shares allocated to Management in the year 1,808,731 1,525,545 Shares allocated to individual employees in the year 154,122 159,437 Outstanding at the end of the year 6,879,198 5,584,019 Value at Released Cancelled launch date Vesting Outstanding restricted stock units Issued1 (accumulated) (accumulated) Outstanding DKK million date Restricted stock units to employees 2016 Restricted stock units 1,565,411 (1,475,572) (89,839) — 508 Q1 2019 2019 Restricted stock units 2,148,580 — — 2,148,580 660 Q1 2023 Outstanding restricted stock units to employees 3,713,991 (1,475,572) (89,839) 2,148,580 Shares allocated to Management Board 2015 Shares allocated to joint pool 378,943 (378,421) (522) — 108 Q1 2019 2016 Shares allocated to joint pool 96,705 — (1,623) 95,082 29 Q1 2020 2017 Shares allocated to joint pool 356,195 — (24,608) 331,587 76 Q1 2021 2018 Shares allocated 411,090 — (20,077) 391,013 115 Q1 2022 2019 Shares allocated 508,398 — — 508,398 152 Q1 2023 Outstanding shares for Management Board 1,751,331 (378,421) (46,830) 1,326,080 Shares allocated to pools for management group below Management Board 2015 Shares allocated 879,988 (662,172) (217,816) — 251 Q1 2019 2016 Shares allocated 224,055 — (49,574) 174,481 68 Q1 2020 2017 Shares allocated 761,826 — (100,098) 661,728 162 Q1 2021 2018 Shares allocated 1,114,455 — (77,812) 1,036,643 312 Q1 2022 2019 Shares allocated 1,300,333 — — 1,300,333 387 Q1 2023 Outstanding shares for Management group below Management Board 4,280,657 (662,172) (445,300) 3,173,185 Shares allocated to individual employees 323,170 (81,873) (9,944) 231,353 75 2020-2023 Outstanding at the end of 2019 10,069,149 (2,598,038) (591,913) 6,879,198 All restricted stock units and shares allocated to Management are hedged by treasury shares. Novo Nordisk Annual Report 2019

Consolidated Financial Statements 73 5.2 Commitments Commitments The lease commitments are related to IFRS 16 leases primarily for premises and Total contractual obligations and recognised non-current debt can be specified as company cars and include the present value of future lease payments during the follows (payments due by period): lease term. Approximately 74% of the commitments are related to leases outside Denmark. 2019 The purchase obligations primarily relate to purchase agreements regarding More medical equipment and consumer goods. Novo Nordisk expects to fund these Within 1-3 3-5 than commitments with existing cash and cash flow from operations. DKK million 1 year years years 5 years Total Retirement benefit obligations 13 26 25 1,270 1,334 Research and development obligations include contingent payments related to Leases (note 4.2) 847 1,424 734 1,140 4,145 achieving development milestones. Such amounts entail uncertainties in relation to the period in which payments are due because a proportion of the obligations Total obligations recognised is dependent on milestone achievements. Exercise fees and subsequent milestone in the balance sheet 860 1,450 759 2,410 5,479 payments under in-licensing option agreements are excluded, as Novo Nordisk is not contractually obligated to make such payments. Commercial product Leases1 128 229 199 376 932 launch milestones include contingent payments solely related to achievement of a Research and commercial product launch following regulatory approval. Commercial milestones, development obligations 2,600 3,258 1,493 29 7,380 royalty and other payments based on a percentage of sales generated from sale of Research and development - goods following marketing approval are excluded from the contractual commit- potential milestone payments3 300 1,023 1,009 2,403 4,735 ments analysis because of their contingent nature, related to future sales. The due periods disclosed are based on Management’s best estimate. Commercial product launch - potential milestone payments3 — — — 3,468 3,468 DKK million 2019 2018 Purchase obligations relating to investments in property, Other guarantees plant and equipment 172 — — — 172 Other guarantees primarily relate to performance Other purchase obligations 5,695 2,989 1,175 621 10,480 guarantees issued by Novo Nordisk 906 973 Total obligations not recog- nised in the balance sheet 8,895 7,499 3,876 6,897 27,167 World Diabetes Foundation (WDF) At the Annual General Meeting in 2014, a donation to WDF was approved. For Total contractual obligations 9,755 8,949 4,635 9,307 32,646 the years 2018-2024, the donation is 0.1% of the Group’s net insulin sales. The annual donation in this period cannot exceed DKK 90 million or 15% of the 2018 taxable income of Novo Nordisk A/S in the financial year in question, whichever is lower. More Within 1-3 3-5 than For 2019, the total donation amounts to DKK 86 million (DKK 85 million in 2018 DKK million 1 year years years 5 years Total and DKK 85 million in 2017). Retirement benefit obligations 13 25 25 1,193 1,256 Total obligations recognised in the balance sheet 13 25 25 1,193 1,256 Operating leases2 1,007 1,463 915 1,511 4,896 Research and development obligations 2,014 1,715 968 75 4,772 Research and development - potential milestone payments3 550 833 818 2,091 4,292 Commercial product launch - potential milestone payments3 — — — 2,591 2,591 Purchase obligations relating to investments in property, plant and equipment 1,875 — — — 1,875 Other purchase obligations 4,392 2,536 1,095 406 8,429 Total obligations not recog- nised in the balance sheet 9,838 6,547 3,796 6,674 26,855 Total contractual obligations 9,851 6,572 3,821 7,867 28,111 1. Predominantly relates to estimated variable property taxes, leases committed not yet commenced and low value assets. 2. There were no material finance lease obligations in 2018. 3. Potential milestone payments are associated with uncertainty as they are linked to success- ful achievements in research activities. Novo Nordisk Annual Report 2019

Consolidated Financial Statements 74 5.3 Related party transactions 5.4 Fee to statutory auditors Novo Nordisk A/S is controlled by Novo Holdings A/S (incorporated in Denmark), DKK million 2019 2018 2017 which owns 28.1% of the share capital in Novo Nordisk A/S, representing 76.1% of the total number of votes. The remaining shares are widely held. The ultimate Statutory audit 26 25 24 parent of the Group is the Novo Nordisk Foundation (incorporated in Denmark). Audit-related services 4 3 4 Both entities are considered related parties. Tax advisory services 11 11 10 Other services 4 3 5 As associated companies of Novo Nordisk A/S, NNIT Group and Churchill Stateside Solar Fund XIV, LLC (‘CS Solar Fund XIV’) are considered related parties. As an Total fee to statutory auditors 45 42 43 associated company of Novo Holdings A/S, Unchained Labs, Inc. is considered a related party to Novo Nordisk A/S. As they share a controlling shareholder, the Novozymes Group and Xellia Pharmaceuticals are also considered to be related Fees for services other than statutory audit of the financial statements parties as well as the Board of Directors or Executive Management of Novo amount to DKK 19 million (DKK 17 million in 2018 and DKK 19 million in Nordisk A/S. 2017). PricewaterhouseCoopers Statsautoriseret Revisionspartnerselskab (PricewaterhouseCoopers Denmark) provided other services in the amount of DKK In 2019, Novo Nordisk A/S acquired 14,025,000 B shares, worth DKK 4.9 12 million (DKK 9 million in 2018 and DKK 8 million in 2017). Services other than billion, from Novo Holding A/S as part of the DKK 15.0 billion share repurchase statutory audit of the financial statements provided by PricewaterhouseCoopers programme. The transaction price for each transaction was calculated as the Statsautoriseret Revisionspartnerselskab (PricewaterhouseCoopers Denmark) average market price in the open windows following the announcements of the comprise services relating to tax compliance and transfer pricing, educational financial results for the four quarters in 2019. training, review of social and environmental information, other assurance opinions and agreed-upon procedures, as well as accounting advice. The Group has had the following material transactions with related parties: DKK million 2019 2018 2017 Novo Holdings A/S Purchase of Novo Nordisk B shares 4,894 4,207 — Sale of NNIT B shares — (368) — Dividend payment to Novo Holdings A/S 5,580 5,496 5,330 NNIT Group Services provided by NNIT 941 1,052 1,231 Dividend payment from NNIT (20) (19) (26) Novozymes Group Services provided by Novo Nordisk (132) (115) (145) Services provided by Novozymes 103 121 163 CS Solar Fund XIV Purchase of shares by Novo Nordisk 97 — — Liability for capital commitment 389 — — Distribution by CS Solar Fund XIV (385) — — In Novo Nordisk A/S, there were no transactions with the Board of Directors or Executive Management besides remuneration. There were no other transactions with the Board of Directors or Executive Management of NNIT A/S, Novozymes A/S, Novo Holdings A/S, the Novo Nordisk Foundation, Xellia Pharmaceuticals ApS, Unchained Labs or CS Solar Fund XIV. For information on remuneration of the Management of Novo Nordisk, please refer to note 2.4, ‘Employee costs’. There are no loans to the Board of Directors or Executive Management in 2019, nor were there any in 2018 or 2017. There are no material unsettled balances with related parties at the end of the year. Novo Nordisk Annual Report 2019

Consolidated Financial Statements 75 5.5 Companies in the Novo Nordisk Group Activity: • Sales and marketing • Production • Research and development • Services/investments Percentage of Percentage of Company and country shares owned Activity Company and country shares owned Activity Parent company Region AAMEO Novo Nordisk A/S, Denmark • • • • Aldaph SpA, Algeria 100 • • Novo Nordisk Pharmaceuticals Pty. Ltd., Australia 100 • Subsidiaries by region Novo Nordisk Pharma (Private) Limited, Bangladesh 100 • Novo Nordisk Egypt LLC, Egypt 100 • North America Operations Novo Nordisk India Private Limited, India 100 • Novo Nordisk Canada Inc., Canada 100 • Novo Nordisk Service Centre (India) Pvt. Ltd., India 100 • Novo Nordisk Inc., United States 100 • PT. Novo Nordisk Indonesia, Indonesia 100 • Novo Nordisk US Bio Production, Inc., United States 100 • Novo Nordisk Pars, Iran 100 • Novo Nordisk US Holdings Inc., United States 100 • Novo Nordisk Ltd, Israel 100 • Novo Nordisk Pharmaceutical Industries LP, United States 100 • Novo Nordisk Kazakhstan LLP, Kazakhstan 100 • Novo Nordisk Research Center Indianapolis, Inc., United States 100 • Novo Nordisk Kenya Ltd., Kenya 100 • Novo Nordisk Research Center Seattle, Inc., United States 100 • Novo Nordisk Pharma SARL, Lebanon 100 • Novo Nordisk Pharma, Inc., United States 100 • Novo Nordisk Pharma (Malaysia) Sdn Bhd, Malaysia 100 • Novo Nordisk Pharma Operations (Business Area) Sdn Bhd, Malaysia 100 • International Operations Novo Nordisk Pharma SAS, Morocco 100 • Novo Nordisk Pharma Operations A/S, Denmark 100 • • Novo Nordisk Pharmaceuticals Ltd., New Zealand 100 • Novo Nordisk Region AAMEO and LATAM A/S, Denmark 100 • Novo Nordisk Pharma Limited, Nigeria 100 • Novo Nordisk Pharma (Private) Limited, Pakistan 100 • Region Japan & Korea Novo Nordisk Pharmaceuticals (Philippines) Inc., Philippines 100 • Novo Nordisk Region Japan & Korea A/S, Denmark 100 • Novo Nordisk Limited Liability Company, Russia 100 • Novo Nordisk Pharma Ltd., Japan 100 • • Novo Nordisk Production Support LLC, Russia 100 • Novo Nordisk Pharma Korea Ltd., South Korea 100 • Novo Investment Pte Limited, Singapore 100 • Novo Nordisk Pharma (Singapore) Pte Ltd., Singapore 100 • Region Europe Novo Nordisk (Pty) Limited, South Africa 100 • Novo Nordisk Pharma GmbH, Austria 100 • Novo Nordisk Lanka (PVT) Ltd, Sri Lanka 100 • S.A. Novo Nordisk Pharma N.V., Belgium 100 • Novo Nordisk Pharma (Thailand) Ltd., Thailand 93 • Novo Nordisk Pharma d.o.o., Bosnia and Herzegovina 100 • Novo Nordisk Tunisie SARL, Tunisia 100 • Novo Nordisk Pharma EAD, Bulgaria 100 • Novo Nordisk Saglik Ürünleri Tic. Ltd. Sti., Turkey 100 • Novo Nordisk Hrvatska d.o.o., Croatia 100 • Novo Nordisk Ukraine, LLC, Ukraine 100 • Novo Nordisk s.r.o., Czech Republic 100 • Novo Nordisk Pharma Gulf FZ-LLC, United Arab Emirates 100 • Novo Nordisk Pharmatech A/S, Denmark 100 • • Novo Nordisk Region Europe A/S, Denmark 100 • Region China Novo Nordisk Denmark A/S, Denmark 100 • Novo Nordisk (China) Pharmaceuticals Co., Ltd., China 100 • • Novo Nordisk Farma OY, Finland 100 • Beijing Novo Nordisk Pharmaceuticals 100 • Novo Nordisk, France 100 • Science & Technology Co., Ltd., China Novo Nordisk Production SAS, France 100 • Novo Nordisk Hong Kong Limited, Hong Kong 100 • Novo Nordisk Pharma GmbH, Germany 100 • Novo Nordisk Pharma (Taiwan) Ltd., Taiwan 100 • Novo Nordisk Hellas Epe., Greece 100 • Novo Nordisk Hungária Kft., Hungary 100 • Region Latin America Novo Nordisk Biopharm Limited, Ireland 100 • • Novo Nordisk Pharma Argentina S.A., Argentina 100 • Novo Nordisk Limited, Ireland 100 • Novo Nordisk Produção Farmacêutica do Brasil Ltda., Brazil 100 • Novo Nordisk S.P.A., Italy 100 • Novo Nordisk Farmacêutica do Brasil Ltda., Brazil 100 • UAB Novo Nordisk Pharma, Lithuania 100 • Novo Nordisk Farmacéutica Limitada, Chile 100 • Novo Nordisk Farma dooel, Macedonia 100 • Novo Nordisk Colombia SAS, Colombia 100 • Novo Nordisk B.V., Netherlands 100 • Novo Nordisk Mexico S.A. de C.V., Mexico 100 • Novo Nordisk Scandinavia AS, Norway 100 • Novo Nordisk Panama S.A., Panama 100 • Novo Nordisk Pharmaceutical Services Sp. z o.o., Poland 100 • Novo Nordisk Peru S.A.C., Peru 100 • Novo Nordisk Comércio Produtos Farmacêuticos Lda., Portugal 100 • Novo Nordisk Venezuela Casa de Representación C.A., 100 • Novo Nordisk Farma S.R.L., Romania 100 • Venezuela Novo Nordisk Pharma d.o.o. Belgrade (Serbia), Serbia 100 • Novo Nordisk Slovakia s.r.o., Slovakia 100 • Other subsidiaries and associated companies Novo Nordisk, d.o.o., Slovenia 100 • NNE A/S, Denmark 100 • Novo Nordisk Pharma S.A., Spain 100 • NNIT A/S, Denmark 18 • Novo Nordisk Scandinavia AB, Sweden 100 • Churchill Stateside Solar Fund XIV, LLC, United States 99 • Novo Nordisk Health Care AG, Switzerland 100 • • Novo Nordisk Pharma AG, Switzerland 100 • Companies without significant activities are not included in the list. NNE A/S Novo Nordisk Holding Limited, United Kingdom 100 • subsidiaries are not included in the list. Novo Nordisk Limited, United Kingdom 100 • Ziylo Limited, United Kingdom 100 • Novo Nordisk Annual Report 2019

Part of management´s review − not audited 76 Financial definitions (part of Management's review – not audited) Financial ratios have been calculated in accordance with the guidelines from the Danish Society of Financial Analysts, and supplemented by certain key ratios for Novo Nordisk. Financial ratios are described below and in the section 'Non-IFRS financial measures'. ADR Gross margin An American Depositary Receipt (or ADR) represents ownership of the shares of a Gross profit as a percentage of sales. non-US company and trades in US financial markets. Net profit margin Basic earnings per share (EPS) Net profit as a percentage of sales. Net profit divided by the average number of shares outstanding. Number of shares outstanding Purchase of property, plant and equipment The total number of shares, excluding the holding of treasury shares. Cash flow statement amount for the purchase of property, plant and equipment. Operating margin The definition of capital expenditure has been redefined in 2019. Capital expend- Operating profit as a percentage of sales. iture is now defined as purchase of property, plant and equipment from the cash flow statement. Amounts for 2015-2018 have been restated in the 'Performance Other comprehensive income (OCI) highlights'. Other comprehensive income comprises all items recognised in Equity for the year other than those related to transactions with owners of the company. Examples of Diluted earnings per share items that are required to be presented in OCI are: Net profit divided by average number of shares outstanding, including the dilutive effect of the outstanding restricted stock units. • Exchange rate adjustments of investments in subsidiaries. • Remeasurements of defined benefit plans. Effective tax rate • Changes in fair value of financial instruments in a cash flow hedge. Income taxes as a percentage of profit before income taxes. Payout ratio Equity ratio Total dividends for the year as a percentage of net profit. Total equity at year-end as a percentage of total assets at year-end. Return on equity (ROE) Net profit for the year as a percentage of shareholders’ equity (average). Non-IFRS financial measures Sales in constant exchange rates DKK million 2019 2018 2017 (part of Management's review - not audited) Net sales IFRS 122,021 111,831 111,696 In the Annual Report, Novo Nordisk discloses certain financial measures of the Effect of exchange rate (3,923) 5,043 2,609 Group’s financial performance, financial position and cash flows that reflect adjustments to the most directly comparable measures calculated and presented Sales in constant exchange in accordance with IFRS. These non-IFRS financial measures may not be defined rates 118,098 116,874 114,305 and calculated by other companies in the same manner, and may thus not be Net sales previous year 111,831 111,696 111,780 comparable. % increase/(decrease) in constant The non-IFRS financial measures presented in the Annual Report are: exchange rates 5.6% 4.6% 2.3% % increase/(decrease) in reported • Sales and operating profit in constant exchange rates currencies 9.1% 0.1% (0.1)% • Operating profit after tax to net operating assets (OPAT/NOA) • Financial resources Operating profit in constant exchange rates • Free cash flow • Cash to earnings DKK million 2019 2018 2017 Operating profit IFRS 52,483 47,248 48,967 IFRS refers to an IFRS financial measure. Effect of exchange rate (2,607) 3,098 1,770 Sales and operating profit growth in constant exchange rates Operating profit in constant 'Growth in constant exchange rates’ means that the effect of changes in exchange exchange rates 49,876 50,346 50,737 rates is excluded. It is defined as sales/operating profit for the period measured at the average exchange rates for the same period prior year compared with net Operating profit previous year 47,248 48,967 48,432 sales/operating profit for the same period prior year. Price adjustments within % increase/(decrease) in constant hyperinflation countries as defined in IAS 29 ‘Financial reporting in hyperinfla- exchange rates 5.6% 2.8% 4.8% tion economies’ are excluded from the calculation to avoid growth in constant % increase/(decrease) in reported exchange rates being artificially inflated. currencies 11.1% (3.5%) 1.1% Growth in constant exchange rates is considered to be relevant information for investors in order to understand the underlying development in sales and oper- ating profit by adjusting for the impact of currency fluctuations. Novo Nordisk Annual Report 2019

Part of management´s review − not audited 77 Operating profit after tax to net operating assets (OPAT/NOA) Financial resources Operating profit after tax to net operating assets is defined as ‘operating profit 'Financial resources at the end of the year' is defined as the sum of cash and after tax (using the effective tax rate) as a percentage of average inventories, cash equivalents at the end of the year, undrawn committed credit facilities less receivables, property, plant and equipment, intangible assets and deferred tax bank overdrafts classified as liabilities arising from financing activities (part of assets less non-interest-bearing liabilities including provisions and deferred tax borrowings). liabilities (where average is the sum of the above assets and liabilities at the begin- ning of the year and at year-end divided by two). Management believes that financial resources at the end of the year are an important measure of the Group's financial strength from an investor's perspec- Management believes operating profit after tax to net operating assets is a useful tive, capturing the robustness of the Group's financial position and its financial measure in providing investors and Management with information regarding the preparedness for unforeseen developments. Group's performance. The calculation of this financial target is a widely accepted measure of earnings efficiency in relation to total capital employed. The following table reconciles total financial resources with cash and cash equiva- lents, the most directly comparable IFRS financial measure: Solely for the purpose of calculating average net operating assets for 2019, year-end net operating assets for 2018 have been adjusted upwards by DKK 3,778 Financial resources million to DKK 40,541 million, reflecting the recognition by Novo Nordisk of right- DKK million 2019 2018 2017 of-use assets of DKK 3,778 million as of 1 January 2019 in accordance with IFRS 16. Comparative figures for 2018 and 2017 have not been restated. Please refer Cash and cash equivalents IFRS 15,411 15,629 17,158 to note 1.2. Undrawn committed credit facilities 11,578 11,574 8,190 Borrowings (bank overdrafts) (595) (506) — The following table shows the calculation of operating profit after tax to net operating assets: Financial resources 26,394 26,697 25,348 Operating profit after tax to net operating assets Free cash flow DKK million 2019 2018 2017 Novo Nordisk used to define free cash flow as ‘net cash generated from operating activities’ less ‘net cash used in investing activities’ excluding net change in Operating profit after tax 42,091 38,318 38,341 marketable securities. / Average net operating assets 42,940 32,832 26,776 From 1 January 2019, Novo Nordisk defines free cash flow as ’net cash generated Operating profit after tax to net from operating activities’, less ‘net cash used in investing activities’, less repayment operating assets in % 98.0% 116.7% 143.2% on lease liabilities and excluding net change of marketable securities. The updated definition reflects the implementation of IFRS 16, which accordingly has a neutral effect on free cash flow. OPAT/NOA numerator Reconciliation of operating profit to operating profit after tax: Free cash flow is a measure of the amount of cash generated in the period which DKK million 2019 2018 2017 is available for the Board to allocate between Novo Nordisk's capital providers, through measures such as dividends, share repurchases and repayment of debt Operating profit IFRS 52,483 47,248 48,967 (excluding lease liability repayments) or for retaining in the business to fund future Tax on operating profit (using growth. effective tax rate) (10,392) (8,930) (10,626) The following table shows a reconciliation of free cash flow with net cash Operating profit after tax 42,091 38,318 38,341 generated from operating activities, the most directly comparable IFRS financial measure: OPAT/NOA denominator Free cash flow Reconciliation of average net operating assets: IFRS DKK million 2019 2018 2017 DKK million 2019 2018 2017 Net cash generated from operating Intangible assets 5,835 5,145 3,325 activities IFRS 46,782 44,616 41,168 Property, plant and equipment 50,551 41,891 35,247 Net cash used in investing activities Deferred income tax assets 4,121 2,893 1,941 IFRS (11,509) (12,080) (6,571) Other receivables and prepayments Net purchase of marketable secu- (non-current) 841 — — rities IFRS — — (2,009) Inventories 17,641 16,336 15,373 Repayment on lease liabilities IFRS (822) — — Trade receivables 24,912 22,786 20,165 Tax receivables 806 1,013 958 Free cash flow 34,451 32,536 32,588 Other receivables and prepayments (current) 3,434 3,090 2,428 Cash to earnings Deferred tax liabilities (80) (118) (846) Cash to earnings is defined as 'free cash flow as a percentage of net profit'. Retirement benefit obligations (1,334) (1,256) (1,336) Provisions (non-current) (4,613) (3,392) (3,302) Management believes that cash to earnings is an important performance Trade payables (6,358) (6,756) (5,610) metric because it measures the Group’s ability to turn earnings into cash. Since Tax payables (4,212) (4,610) (4,242) Management wants this measure to capture the ability of the Group’s operations to generate cash, free cash flow is used as the numerator instead of net cash flow. Other liabilities (15,085) (14,098) (14,446) Provisions (current) (31,120) (26,161) (20,755) The following table shows the calculation of cash to earnings: Net operating assets 45,339 36,763 28,900 Cash to earnings DKK million 2019 2018 2017 Average net operating assets 42,9401 32,832 26,776 Free cash flow 34,451 32,536 32,588 1. Average net operating assets for 2019 is calculated based on an adjusted net operating / Net profit IFRS 38,951 38,628 38,130 assets figure for 2018, which has been adjusted by the right-of-use assets of DKK 3,778 million as of 1 January 2019, following the implementation of IFRS 16. As a consequence, Cash to earnings 88.4% 84.2% 85.5% the net operating assets figure for 2018 has been adjusted to DKK 40,541 million for the calculation of the average net operating assets for 2019. Novo Nordisk Annual Report 2019

Consolidated Social Statement (supplementary information) 78 Statement of social performance for the year ended 31 December Note 2019 2018 2017 Patients Patients reached with Novo Nordisk's diabetes care products (estimate in millions) 7.1 30.0 29.2 27.7 Patients reached with Novo Nordisk's diabetes care products via the Access to Insulin Commitment (estimate in millions) 7.1 2.91 0.3 0.3 Donations (DKK million) 7.2 105 103 103 Animals purchased for research 7.3 49,637 65,593 67,623 Employees Employees (total) 8.1 43,258 43,202 42,682 Employee turnover 8.1 11.4% 11.7% 11.0% Employee engagement 91% 91% 90% Gender in management (ratio men:women) 8.1 60:40 60:40 60:40 Frequency of occupational accidents (number per million working hours) 8.2 2.2 2.4 2.7 Responsible business Relevant employees trained in business ethics 9.1 99% 99% 99% Business ethics reviews 9.2 34 33 34 Facilitations of the Novo Nordisk Way 9.3 32 63 65 Supplier audits 9.4 236 294 246 Product recalls 9.5 4 3 6 Failed inspections 9.6 0 0 0 Company trust (scale 0–100) 9.7 78.2 84.5 82.2 Total tax contribution (DKK million) 9.8 27,527 25,825 — 1. Scope of Access to Insulin Commitment expanded in 2019 to also include middle-income countries and selected organisations providing humanitarian relief. Notes to the consolidated social statement Section 6 Basis of preparation General reporting standards and principles • The UN Guiding Principles Reporting Framework, the only comprehensive Novo Nordisk's annual reporting complies with the Danish Financial Statements guidance for companies to report on how they respect human rights. Novo Act. Sections 99a and b specify the requirements of the EU Directive on disclosure Nordisk’s implementation of the Guiding Principles on Business and Human of non-financial and diversity information to report on management of risks Rights is reported at novonordisk.com. related to the environment, climate, human rights, labour and social conditions, anti-corruption and gender distribution. This requirement is addressed in the • The UK Modern Slavery Act, adopted in 2015, requires commercial organisa- Management Review. Novo Nordisk also adheres to the following internationally tions operating in the UK to publish an annual slavery and human trafficking recognised voluntary reporting standards and principles: statement. Novo Nordisk’s annual statement is available at novonordisk.com. • The International Integrated Reporting Framework, <IR>, developed by the • The AA1000AP(2018) and AA1000AS(2008) framework, which states that International Integrated Reporting Council. The framework consists of a set reporting must provide a complete, accurate, relevant and balanced picture of of content elements and guiding principles intended to improve the quality of the organisation’s approach to and impact on stakeholders and society. information available to providers of financial capital. • The Biotechnology & Pharmaceuticals Sustainability Accounting Standard developed by the Sustainability Accounting Standards Board (SASB). The standard consists of a Novo Nordisk Annual Report 2019 set of topics and accounting metrics companies can use to guide their reporting.

Consolidated Social Statement (supplementary information) 79 • The UN Global Compact, a strategic policy initiative for businesses that are Principles of consolidation committed to aligning their operations and strategies with 10 universally The consolidated social statement and disclosures cover the Novo Nordisk Group accepted principles in the areas of human rights, labour, environment, anti-cor- comprising Novo Nordisk A/S and entities controlled by Novo Nordisk A/S. ruption and broader UN Goals. Novo Nordisk’s obligation as a participant in the UN Global Compact to provide a Communication on Progress is met by Social accounting policies inclusion of material information in the Annual Report and additional informa- The accounting policies set out below and in the notes have been applied consist- tion at novonordisk.com and submitted to the UN Global Compact database at ently in the preparation of the consolidated social statement for all the years unglobalcompact.org. presented. Novo Nordisk applies AA1000AP(2018) as a component in creating a generally Changes to accounting policies and disclosures applicable approach to assessing and strengthening the credibility of the Group’s The following disclosure changes have been made: public reporting of social and environmental information. Novo Nordisk has designed processes to ensure that the qualitative and quantitative information that • 'Patients reached with diabetes care products via the Access to Insulin documents the social and environmental dimensions of performance is assured, Commitment' is expanded in scope to reflect new initiatives, effective as of as well as the systems that underpin the data and performance. The principles 2019. In addition to the least developed countries, the number now also covers outlined in AA1000AP(2018) have been applied as described below. patients reached in selected middle-income countries and through sales to selected organisations providing relief in humanitarian situations. The compara- Inclusivity tive information has not been restated. As a pharmaceutical business with global reach, Novo Nordisk is committed to being accountable to those stakeholders who are impacted by the organisation. • 'Fulfilment of action points from the Novo Nordisk Way' is replaced with From the perspective of social responsibility, the key stakeholder groups are ‘Facilitations of the Novo Nordisk Way’, to align with the new approach to patients who rely on Novo Nordisk products, employees at Novo Nordisk and assessing adherence to the Novo Nordisk Way. throughout the Group’s value chain, business partners and local communities. Novo Nordisk maps its stakeholders and has processes in place to ensure inclusion • 'Company reputation' is replaced by 'Company trust' as a meaningful proxy for of stakeholder concerns and expectations. In addition, Novo Nordisk continuously supportive stakeholder behaviours. The methodology has been adjusted and develops its stakeholder engagement and capacity to be a sustainable business simplified. at corporate, regional and affiliate levels. See how Novo Nordisk defines what is meant by sustainable business in 'Leading a sustainable business'. Materiality Other accounting policies Key issues are identified through ongoing stakeholder engagement and trend- spotting, informed by data-driven analysis and addressed by programmes or Employee engagement action plans with clear and measurable targets. Long-term targets are set to guide Employee engagement is measured on a scale of 1–5 and based on questions performance in strategic areas. The issues presented in the Annual Report are relating to employee engagement in the annual employee survey, OurVoice. The deemed to have a significant impact on the Group’s future business performance score is calculated as the proportion of employees who responded favourably (4 and may support stakeholders in their decision-making. or 5) to relevant questions. For 2019, the response rate was 90% compared with 91% in 2018. Responsiveness The Annual Report reflects how the company is managing operations in ways that respond to and consider stakeholder concerns and interests. The report reaches out to a wide range of stakeholders, each with specific needs and interests. The management report is prepared with investors in mind. To these stakeholders, however, as well as to the many other groups who may seek information in the Annual Report, this is just one element of interaction and communication with the company. Impact Understanding, measuring and communicating the positive and negative impacts on society and the environment of Novo Nordisk's activities are important. Novo Nordisk is currently working on developing methodologies to be better able to do just that covering the entire value chain. Applying materiality The consolidated social statement is a result of assessing legal requirements and disclosure commitments applicable to Novo Nordisk. Whether information is tied directly or indirectly to Novo Nordisk’s ability to create value over the short, medium and long term is also assessed. When assessing whether a disclosure is material to include in the consolidated social statement, Management considers whether the matter is of such relevance and importance that it could substantively influence the assessment by providers of financial capital of Novo Nordisk's ability to create value over the short, medium and long term. See more at novonordisk.com. The conclusion from the external assurance provider is available in the 'Independent limited assurance report'. Novo Nordisk Annual Report 2019

Consolidated Social Statement (supplementary information) 80 Section 7 Patients 7.1 Patients reached with Novo Nordisk's 7.3 Animals purchased for research diabetes care products (estimate) Accounting policies Accounting policies The record of animals purchased for research comprises the number of animals The number of full-year patients reached with Novo Nordisk's diabetes care prod- purchased for all research undertaken by Novo Nordisk either in-house or by ucts, excluding devices and PrandiMet®, is estimated by dividing Novo Nordisk’s external contractors. The number of animals purchased is based on internal regis- annual sales volume by the annual usage dose per patient for each product class tration of purchased animals and yearly reports from external contractors. as defined by the World Health Organization (WHO). PrandiMet® is not included as no WHO-defined dosage exists. Animals purchased Number 2019 2018 2017 The number of full-year patients reached with Novo Nordisk's diabetes care prod- ucts via the Access to Insulin Commitment is estimated by dividing Novo Nordisk's Mice, rats and other rodents 48,081 63,547 65,869 annual sales volume in the least developed countries as defined by the United Pigs 880 1,023 835 Nations and 29 middle-income countries as defined by the World Bank as well as Rabbits 349 641 493 selected organisations providing relief in humanitarian situations, by the annual Dogs 157 100 63 usage dose per patient for human insulin in vials as defined by WHO. WHO has Non-human primates 168 278 241 not yet assigned a daily dose for Rybelsus®. For this calculation, it is assumed that Other vertebrates 2 4 122 one tablet equals one patient treatment day. Total animals purchased 49,637 65,593 67,623 The WHO-defined daily dosage has not changed since 1982, except for Victoza® which was changed in 2019, and may not reflect the recommended or prescribed daily dose accurately. Actual doses are based on individual characteristics (e.g. age The number of animals purchased for research in 2019 decreased by 24% and weight) and pharmacokinetic considerations. Despite this uncertainty, Novo compared with 2018 and reflects the changes in stages of the different research Nordisk assesses this to be the most consistent way of reporting. projects. Furthermore the reduction in the number of rodents purchased, reflects Novo Nordisk's continuous focus on reducing the number of animals per research Development project. 97% of the animals purchased were rodents. The estimated number of full-year patients reached with Novo Nordisk’s diabetes care products increased from 29.2 million in 2018 to 30.0 million in 2019. This 3% increase was primarily driven by sales of long-acting, premix and fast-acting insulins and GLP-1 products. In 2019, the estimated number of patients reached via the Access to Insulin Commitment was 2.9 million, compared with 0.3 million in 2018. The significant increase is due to an expansion of the Access to Insulin Commitment to also include selected middle-income countries as well as selected organisations providing relief in humanitarian situations. Novo Nordisk sold insulin according to this commitment in 31 countries. Beyond this scheme, Novo Nordisk also sold human insulin below the ceiling price in other countries reaching an estimated additional 2.2 million patients in 2019. 7.2 Donations Accounting policies Donations by Novo Nordisk to the World Diabetes Foundation (WDF) and the Novo Nordisk Haemophilia Foundation (NNHF) are recognised as an expense when the dona- tion is paid out or when an unconditional commitment to donate has been made. Donations DKK million 2019 2018 2017 World Diabetes Foundation (WDF) 86 85 85 Novo Nordisk Haemophilia Founda- tion (NNHF) 19 18 18 Total donations 105 103 103 WDF, an independent trust, supports sustainable partnerships and acts as a catalyst to help others do more. In 2019, WDF provided funding to 12 partnership projects in 11 countries. The projects focus on awareness, education and capacity building at local, regional and global levels. See 'Note 5.2' in the consolidated financial statements and worlddiabetesfoundation.org. Novo Nordisk also provides financial support for improving global access to haemophilia care. NNHF supports programmes in developing and emerging countries. Initiatives focus on capacity building, diagnosis and registry, education and empowerment. Since 2005, NNHF has provided funding for 284 programmes Novo Nordisk Annual Report 2019 in 75 countries. See nnhf.org.

Consolidated Social Statement (supplementary information) 81 Section 8 Employees 8.1 Employees 8.2 Frequency of occupational accidents Accounting policies Accounting policies The number of employees is recorded as all employees except externals, The frequency of occupational accidents with absence is measured as the inter- employees on unpaid leave, interns, bachelor and master thesis employees and nally reported number of accidents using full-time employees, excluding externals, substitutes at year-end. employees on unpaid leave, interns, bachelor and master thesis employees, and substitutes, per million nominal working hours. An occupational accident with Employees are attributed to geographical regions according to their primary absence is any work-related accident causing at least one day of absence in addi- workplace across the commercial units, research and development, production tion to the day of the accident. and support functions. Employees in corporate functions are included in Region Europe and employees in the global service centre in Bangalore, India are included Development in Region AAMEO (Africa, Asia, Middle-East and Oceania). The average frequency rate of occupational accidents with absence was 2.2 per million working hours in 2019, compared with 2.4 in 2018 due to an 8% The rate of turnover is measured as the number of employees, excluding decrease in the number of accidents. In 2019, Novo Nordisk had one work-related temporary employees, who left the Group during the financial year divided by fatality compared with none in 2018. Novo Nordisk works with a zero-injury the average number of employees, excluding temporary employees. Employees mindset and has a long-term commitment to continuously improving safety working for Group companies that have been disposed are not counted as having performance. left the Group. Diversity at Novo Nordisk is reported as the percentage split by gender in all mana- gerial positions. Managerial positions are defined as all managers at Novo Nordisk (global job level including Executive Vice Presidents (EVP), Senior Vice Presidents (SVP), Corporate Vice Presidents (CVP), Vice Presidents (VP), General Managers (GM), Directors, Managers and Team Leaders). Employees Number 2019 2018 2017 North America 6,190 6,093 6,391 Region Europe 20,980 22,114 21,920 - of which in Denmark 16,747 17,461 17,510 Region AAMEO 7,622 7,127 6,767 Region China 5,263 4,636 4,482 Region Japan & Korea 1,165 1,268 1,252 Region Latin America 2,038 1,964 1,870 Total employees 43,258 43,202 42,682 Full-time employees 42,703 42,672 42,076 Employee turnover 11.4% 11.7% 11.0% Change in employees 0% 1% 1% The underlying growth in employees was mainly driven by Region China. All management teams, from entry level upwards, are encouraged to focus on enhanced diversity, with the aim of ensuring a robust pipeline of talent for management positions. Among employees as a whole, the gender split was 49% women and 51% men in 2019, same as in 2018. The table below shows the gender split among managers. Gender in management Ratio men:women 2019 2018 2017 EVP, SVP 82:18 87:13 86:14 CVP, VP, GM 66:34 66:34 67:33 Director, Manager, Team Leader 59:41 60:40 59:41 Gender in management (overall) 60:40 60:40 60:40 Novo Nordisk Annual Report 2019

Consolidated Social Statement (supplementary information) 82 Section 9 Responsible business 9.1 Relevant employees trained in business ethics 9.3 Facilitations of the Novo Nordisk Way Accounting policies Accounting policies The mandatory business ethics training is based on the Business Ethics Code of Facilitations of the Novo Nordisk Way is measured as the number of facilitations Conduct in the form of globally applicable e-learning, and related tests released and culture coachings completed. Both are internal audit processes for assessing annually by the Novo Nordisk Business Ethics Compliance Office. The target compliance with the Novo Nordisk Way. The assessments are based on review of groups for the individual tests vary in size and are defined by Novo Nordisk. The documentation and feedback from stakeholders followed by an on-site visit during target groups are all employees of Novo Nordisk at the end of the reporting which randomly selected employees and management are interviewed. Identified period except employees on leave, student assistants, PhDs and postdocs. The gaps and improvement opportunities related to the Novo Nordisk Way are percentage of employees completing the training is calculated as the percentage presented to management. The facilitators and management agree on an action of completion of training in both the Code of Conduct and related tests, based on plan to address those gaps and improvement opportunities. internal registrations. In Q4 2018, culture coaching was introduced as a variation of the facilitation Development service to support the company-wide culture journey focused on ‘think bigger’, In 2019, as in 2018, 99% of relevant employees were trained in business ethics. ‘cut complexity’ and ‘be more agile’. Culture coaching builds on the same meth- odology as standard facilitations and is also anchored in the Novo Nordisk Way. In the information below, no distinction is made between a standard facilitation and culture coaching - both are referred to under the term 'facilitations'. 9.2 Business ethics reviews Development In 2019, a total of 32 units were facilitated covering approximately 11,000 Accounting policies employees, of whom around 1,500 were individually interviewed. In addition, The number of business ethics reviews is recorded as the number of business feedback on those units was collected from approximately 400 stakeholders. The ethics reviews performed by Group Internal Audit in subsidiaries, production sites reduction in the number of assignments compared to previous years is mainly a and headquarter areas. During a business ethics review, Group Internal Audit will result of merging assignments to cover entire functional areas instead of facili- examine procedures and processes in place to ensure ethical behaviour. Any gaps tating many departments individually. identified in procedures, processes or behaviour are presented to Management and the Board of Directors as findings. An action plan to mitigate findings is Overall, the 2019 process has shown a high level of adherence to the Novo agreed between Management and Group Internal Audit, and Group Internal Nordisk Way. The highest rated Essential continues to be the 'Patient-centred busi- Audit follows up on the implementation of the agreed actions before closing the ness approach', while the lowest rated Essential 'Focus on personal performance findings. and development' continues to be an area of improvement despite efforts to raise the level of adherence. Business ethics reviews Number 2019 2018 2017 Business ethics reviews 34 33 34 9.4 Supplier audits Findings 87 113 130 Accounting policies Based on the completed business ethics reviews, it is Group Internal Audit’s The number of supplier audits concluded by Novo Nordisk’s Corporate Quality assessment that the business ethics compliance level, in 2019 as in 2018, is sound. function includes the number of responsible sourcing audits and quality audits Management action plans and closure of findings have progressed as planned, conducted among suppliers. and there were no overdue management actions or findings at the end of the year. Supplier audits Number 2019 2018 2017 Responsible sourcing audits 27 19 28 Quality audits 209 275 218 Total supplier audits 236 294 246 The number of audits concluded in 2019 decreased by 20% compared with 2018. The decrease in quality audits was due to the additional qualification audits in 2018 supporting, among others, the diabetes API project in the US. There were no critical findings related to the quality audits, but one critical finding was issued in connection with a responsible sourcing audit regarding working hours. An action plan with concrete deadlines has been agreed upon and a responsible sourcing re-audit is planned for 2020 to follow up on improvements. Novo Nordisk Annual Report 2019

Consolidated Environmental Statement (supplementary information) 83 9.5 Product recalls 9.8 Total tax contribution Accounting policies Accounting policies The number of product recalls is recorded as the number of times Novo Nordisk Novo Nordisk’s total tax contribution is measured as the taxes borne or collected has instituted a recall and includes recalls in connection with clinical trials. A recall by Novo Nordisk, which have been paid in the respective year. Taxes borne are can affect various countries. defined as taxes where Novo Nordisk carries the cost. Taxes collected are defined as taxes collected by Novo Nordisk on behalf of others, e.g. employee income Development taxes deducted from the employee salary and paid on to the government. Novo Nordisk had four product recalls from the market in 2019, compared with three in 2018. As in 2018, none of the recalls were critical. Local health authorities Tax on company income were informed in all instances to ensure that distributors, pharmacies, doctors and Tax on company income primarily consists of corporate income taxes and with- patients received appropriate information. holding taxes on company dividends. Employment taxes Employment taxes primarily consist of taxes collected from the employees on 9.6 Failed inspections behalf of the government and social security costs. Indirect taxes Accounting policies Indirect taxes consist of non-refundable VAT, net VAT collections, customs duties, The number of failed inspections is measured in relation to the US Food & Drug environmental taxes and property taxes. Administration (USFDA), the European Medicines Agency (EMA), Notified Body (TÜV SUD) and domestic authorities for strategic manufacturing sites. Failed Other taxes inspections are defined as inspections where Warning Letters or EMA non-com- Other taxes consist of country-specific taxes not linked to one of the categories pliance letters related to GMP inspections are received, GMP/ISO certificates for above, e.g. the US branded prescription drug (BPD) fee. strategic sites are lost, pre-approval inspections result in a Warning Letter, study conclusions are changed due to GCP/GLP inspection issues, or marketing or import The total tax contribution in 2019 amounted to DKK 27,527 million split into 54% authorisations are withdrawn due to inspection issues. Strategic sites are defined on taxes borne and 46% on taxes collected compared with 2018, where the total as the manufacturing sites in Brazil, China, Denmark, France and the US. tax contribution was DKK 25,825 million split into 53% on taxes borne and 47% on taxes collected. Development In 2019, as in 2018, there were no failed inspections among those resolved at Total tax contribution 2019 year-end. During the year, 66 inspections were conducted compared with 75 in Taxes col- 2018. At year-end, 44 inspections were passed and 22 were unresolved, as final DKK million Taxes borne lected Total inspection reports had not been received or the final authority acceptance was pending, which is normal. Follow-up on unresolved inspections continues in 2020. Tax on company income 10,936 3,456 14,392 Employment taxes 1,642 7,996 9,638 Indirect taxes 1,364 1,246 2,610 Other taxes 887 — 887 9.7 Company trust Total 14,829 12,698 27,527 Accounting policies Company trust is measured annually. The total score is measured as the mean Total tax contribution 2018 company trust score among people with diabetes, general practitioners and Taxes col- diabetes specialists across key markets. Trust is measured on a scale of 0–100, DKK million Taxes borne lected Total with 100 being the best possible score. A score above 80 is considered excellent; a score between 70 and 80 is considered strong. Data were collected between June Tax on company income 9,614 3,392 13,006 and September 2019. Employment taxes 1,571 7,856 9,427 Indirect taxes 1,300 957 2,257 The data are collected through annual surveys carried out by external consultancy Other taxes 1,135 — 1,135 firms. Total 13,620 12,205 25,825 Company trust Scale 0-100 2019 2018 2017 People with diabetes 78.1 78.6 82.1 General practitioners 75.3 85.7 78.5 Diabetes specialists 81.3 89.2 86.0 Total score (average) 78.2 84.5 82.2 The decline in trust can best be explained by the increased scrutiny on pharma throughout 2019, in particular in regards to pricing, access and affordability of medicines, which continues to be reflected in media sentiment and social media conversations. The decline in trust is not unique to Novo Nordisk, but is a trend across the pharma sector. Novo Nordisk Annual Report 2019

Consolidated Environmental Statement (supplementary information) 84 Statement of environmental performance for the year ended 31 December Note 2019 2018 2017 Resources Energy consumption for operations (1,000 GJ) 11.1 2,993 3,099 — Share of renewable power for production sites 11.1 76% 77% 79% Water consumption for production sites (1,000 m3) 11.2 3,149 3,101 3,276 Emissions and waste CO2 emissions from operations and transportation (1,000 tons) 12.1 306 278 — Waste from production sites (1,000 tons) 12.2 124 142 157 Responsible business Breaches of regulatory limit values 13.1 16 27 23 Notes to the consolidated environmental statement Principles of consolidation Section 10 The consolidated environmental statement covers the production sites, laborato- ries and offices with significant activities. 2CO emissions related to transportation Basis of preparation cover cars leased or owned by Novo Nordisk, business flights and suppliers distrib- uting Novo Nordisk products. Environmental accounting policies General reporting standards and principles The accounting policies set out below have been applied consistently in the prepa- The consolidated environmental statement has been prepared in accordance with ration of the consolidated environmental statement for all the years presented. the same standards as those for the consolidated social statement. See 'Section 6 Basis of preparation’ of the consolidated social statement for general overview. In Changes to accounting policies and disclosures addition, the following standards have been applied: The following disclosure changes have been made: • Recommendations of the Financial Stability Board's Task Force on Climate- • 'Energy consumption for operations’ is expanded in scope from covering all related Financial Disclosures (TCFD). TCFD aims to develop voluntary, consistent facilities at production sites to also include office buildings and laboratories climate-related financial risk disclosures for use by companies in providing outside of production sites. Comparative information has been updated information to investors, lenders, insurers, and other stakeholders. Novo accordingly. Nordisk’s actions taken in line with the TCFD recommendations are reported at novonordisk.com. • 'CO2 emissions from production sites and product distribution' has been taken out. This information is included in 'CO2 emissions from operations and • CDP (formerly Climate Disclosure Project). CDP runs a global environmental transportation'. disclosure system, which supports companies with measuring and managing risks and opportunities related to climate change, water security and deforesta- • The accounting policy for 'CO2 emissions from business flights', included in tion. Novo Nordisk's CDP disclosures are publicly available at cdp.net the note for 'CO2 emissions' has been updated to include passenger class. Novo Nordisk Annual Report 2019 Comparative information has been updated accordingly.

Consolidated Environmental Statement (supplementary information) 85 Section 11 Resources 11.1 Energy consumption for operations and share reduced energy use to produce diabetes finished products. Energy consumption of renewable power decreased by 10% from offices and laboratories due to various smaller changes across multiple sites. Accounting policies In 2019, 76% of power used at production sites was sourced from renewable Energy consumption for operations is measured as consumption of power, steam, energy, a decrease from 77% in 2018. This is due to lower power consumption at heat and fuel. The fuel is mainly from natural gas, biogas and wood. Energy the largest production site in Kalundborg, Denmark which uses wind power. With consumption is based on meter readings and invoices and covers all energy types an agreement to have solar power in the United States, effective as of 2020, Novo at production sites and laboratories and consumption of power at office buildings Nordisk is on track to achieve 100% renewable power at all production sites in 2020. outside of production sites. Share of renewable power used at production sites is reported according to the Greenhouse Gas (GHG) Protocol Scope 2 Guideline. It is calculated as the sum of power in each country that comes from 100% renewable sources, either sourced 11.2 Water consumption for production sites or self-produced. Energy consumption for operations Accounting policies 1,000 GJ 2019 2018 2017 Water consumption is measured based on meter readings and invoices. It includes drinking water, industrial water and steam used at production sites. Production 2,458 2,502 — Office buildings and laboratories 535 597 — Development In 2019, water consumption at production sites increased slightly by 2% Total energy consumption 2,993 3,099 — compared with 2018. This was due to an increase in water consumption for production of API for Diabetes and Obesity care. Energy consumption for operations has expanded in scope from covering all facil- Three facilities, in Algeria, Brazil and China, are in regions subject to high water ities at production sites to also include office buildings and laboratories outside of stress or large seasonal variations, consuming 14% of the total water for global production sites. In 2019, energy consumption for operations decreased by 3% production. There have been no water shortage incidents in 2019 and overall, compared to 2018. Energy consumption for production decreased 2% due to water consumption at these facilities increased by 2% in 2019. Section 12 Emissions and waste 12.1 CO2 emissions from operations and transportation CO2 emissions from operations and transportation 1,000 tons 2019 2018 2017 Accounting policies Production 86 86 — CO2 emissions from operations (production, office buildings and Office buildings and laboratories 13 28 — laboratories) Product distribution 80 39 — CO emissions from operations cover consumption of power, fuel, heat and 2 Business flights 65 63 — steam at office buildings in Denmark, global production sites and laboratories, Company cars 62 62 — and consumption of power in office buildings outside Denmark. Emissions are measured in metric tons, calculated according to the GHG Protocol and based on Total CO2 emissions 306 278 — emission factors from the previous year. CO2 emissions from product distribution Novo Nordisk has a long-term target of zero CO2 emissions from operations and CO2 emissions from product distribution are calculated by external transportation transportation by 2030. suppliers as the estimated emissions from product distribution in metric tons. CO2 emissions are calculated based on the worldwide distribution of semi-finished and In 2019, CO2 emissions from operations and transportation increased by 10%. finished products, raw materials and components by air, sea and road between The increase was primarily from product distribution, due to an increase in production sites and from production sites to subsidiaries, direct customers and distributed volume, along with using more air freight than sea freight as a result of importing distributors. CO2 emissions from product distribution from subsidiaries supply and market driven-challenges. to pharmacies, hospitals and wholesalers are not included. CO2 emissions from global offices and laboratories decreased by 54% in 2019. As CO2 emissions from business flights part of the new Circular for Zero strategy, all offices and laboratories will source CO2 emissions from business flights are estimated based on mileage and emission renewable power by 2030. In 2019, there was a significant reduction in CO2 factors for short, medium and long-haul flights along with passenger class emissions from the R&D site in Beijing, sourcing wind power. obtained from travel agencies. CO2 emissions are expected to decrease significantly in 2020 due to various CO2 emissions from company cars renewable energy projects, including solar power across all US operations, wind CO2 emissions from company cars cover cars leased or owned by Novo Nordisk. power in Europe and green steam in Denmark. Emissions from transportation are Emissions are calculated by multiplying emission factors by the volumes of diesel also expected to decrease due to a company car policy that encourages transition and gasoline used. to hybrid and electric vehicles and through collaboration with EV100. Novo Nordisk Annual Report 2019 A full breakdown of Scope 1, 2 and 3 emissions from Novo Nordisk can be found at cdp.net.

Consolidated Environmental Statement (supplementary information) 86 12.2 Waste from production sites In 2019, waste from production sites decreased by 13% compared with 2018. The amount of waste recycled decreased 8% in 2019 primarily due to a decrease in organic residues from the fermentation of insulin. Accounting policies Waste is measured as the sum of all the waste disposed of at production sites The amount of waste sent for energy recovery decreased by 36% primarily due based on weight receipts. to the implementation of a distillation method within API production to reuse ethanol instead of sending it for incineration with energy recovery. Waste from production sites 1,000 tons 2019 2018 2017 In 2019, 93% of the total waste from production sites was recycled, used for biogas production or incinerated at plants where the energy is used for heat and Recycling 97 105 122 power production. - Organic residues1 89 93 116 - Other (paper, cardboard, metals etc.) 8 12 6 18% of the waste is categorised as hazardous waste, a decrease from 21% in 2018. This decrease was due to a reduction in ethanol waste from the production Energy recovery2 18 28 28 of API for Diabetes and Obesity care. - Ethanol waste3 13 22 21 - Other (various combustible waste) 5 6 7 No energy recovery4 8 8 6 - Water waste 5 4 5 - Other 3 4 1 Landfill 1 1 1 Total waste 124 142 157 1. Organic residues for recycling are waste from the production of the active pharmaceutical ingredients, where the energy is recovered in biogas plants and the digested slurry is used on local farmland as fertiliser. 2. Energy recovery is waste disposed of at waste-to-energy plants and at a biogas plant. 3. Ethanol is used in purification of Diabetes care and Biopharm products. The ethanol is recovered in internal regeneration plants and re-used many times. The ethanol waste reported here is from production with no regeneration or residues from the regeneration process. 4. Water waste and other waste not suitable for other disposal methods, such as hazardous waste for incineration and various other types of waste. Section 13 Responsible business 13.1 Breaches of regulatory limit values Accounting policies Breaches of regulatory limit values cover all breaches reported to the environ- mental authorities. Development In 2019 there were 16 breaches, a decrease from 27 breaches in 2018. The breaches were mainly related to wastewater, and all had minor impact on the environment. Novo Nordisk Annual Report 2019

Consolidated Financial Statements – Management statement 87 Statement by the board of directors and executive management on the annual report Today, the Board of Directors and Executive Management approved the Annual In our opinion, the Consolidated financial statements and the Financial statements Report of Novo Nordisk A/S for the year 2019. The Board of Directors and Execu- of the parent company give a true and fair view of the financial position at 31 tive Management are jointly responsible for ensuring the integrity and quality of December 2019, the results of the Group’s and parent company’s operations, and the report. consolidated cash flows for the financial year 2019. Furthermore, in our opinion, Management's review includes a true and fair account of the development in The Annual Report has been prepared in accordance with the International Inte- the operations and financial circumstances, of the results for the year and of the grated Reporting Framework. financial position of the Group and the parent company as well as a description of the most significant risks and elements of uncertainty facing the Group and the The Consolidated financial statements have been prepared in accordance with parent company. International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board and in accordance with IFRS as endorsed by the EU Novo Nordisk’s Consolidated social and environmental statements have been and further requirements in the Danish Financial Statements Act. prepared in accordance with the reporting principles of materiality, inclusivity and responsiveness of AA1000APS(2018), and social and environmental accounting Further, the Financial statements of the parent company and Management’s policies. They give a true and fair account and a balanced and reasonable pres- review have been prepared in accordance with the Danish Financial Statements entation of the organisation’s social and environmental performance in accordance Act. with these principles. We recommend that the Annual Report be adopted at the Annual General Meeting. Bagsværd, 5 February 2020 Registered Executive Management Lars Fruergaard Jørgensen Karsten Munk Knudsen Monique Carter President and CEO CFO Camilla Sylvest Mads Krogsgaard Thomsen Henrik Wulff Board of Directors Helge Lund Jeppe Christiansen Brian Daniels Chair Vice chair Laurence Debroux Andreas Fibig Sylvie Grégoire Liz Hewitt Mette Bøjer Jensen Kasim Kutay Anne Marie Kverneland Martin MacKay Thomas Rantzau Stig Strøbæk Novo Nordisk Annual Report 2019

Independent auditor’s report 88 Independent auditor's report To the shareholders of Novo Nordisk A/S Our opinion Basis for opinion In our opinion, the Consolidated Financial Statements give a true and fair view We conducted our audit in accordance with International Standards on Auditing of the Group’s financial position at 31 December 2019 and of the results of the (ISAs) and the additional requirements applicable in Denmark. Our responsibilities Group’s operations and cash flows for the financial year 1 January to 31 December under those standards and requirements are further described in the Auditor’s 2019 in accordance with International Financial Reporting Standards as adopted responsibilities for the audit of the Financial Statements section of our report. by the EU and further requirements in the Danish Financial Statements Act. We believe that the audit evidence we have obtained is sufficient and appropriate Moreover, in our opinion, the Parent Company Financial Statements give a true to provide a basis for our opinion. and fair view of the Parent Company’s financial position at 31 December 2019 and of the results of the Parent Company’s operations for the financial year 1 January Independence to 31 December 2019 in accordance with the Danish Financial Statements Act. We are independent of the Group in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants Our opinion is consistent with our Auditor’s Long-form Report to the Audit (IESBA Code) and the additional requirements applicable in Denmark. We have Committee and the Board of Directors. also fulfilled our other ethical responsibilities in accordance with the IESBA Code. What we have audited To the best of our knowledge and belief, prohibited non-audit services referred to The Consolidated Financial Statements of Novo Nordisk A/S for the financial year in Article 5(1) of Regulation (EU) No 537/2014 were not provided. 1 January to 31 December 2019, section ‘Consolidated financial statements’, comprise income statement and statement of comprehensive income, cash flow Appointment statement, balance sheet, equity statement and notes, including summary of We were first appointed auditors of Novo Nordisk A/S in April 1982 for the financial significant accounting policies. year 1982. We have been reappointed annually by shareholder resolution for a total period of uninterrupted engagement of 38 years including the financial year 2019. The Parent Company Financial Statements of Novo Nordisk A/S for the financial year 1 January to 31 December 2019, section ‘Financial Statements of the Parent Key audit matters Company’, comprise income statement, balance sheet, equity statement and Key audit matters are those matters that, in our professional judgement, were of notes, including summary of significant accounting policies. most significance in our audit of the Financial Statements for 2019. These matters were addressed in the context of our audit of the Financial Statements as a whole, Collectively referred to as the “Financial Statements”. and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Key audit matter How our audit addressed the key audit matter Revenue recognition relating to rebates and discounts in the US business We obtained Management’s calculations for accruals under applicable schemes and assessed the significance of assumptions applied by comparing them to the The Group sells to various customers in the US, which can fall under certain stated commercial policies, the terms of the applicable contracts, third party data commercial and government mandated contracts and reimbursement arrange- and historical levels of paid rebates and discounts in the US business. ments, of which the most significant are Managed Care, Medicare, Medicaid and charge-backs to wholesalers. We compared the assumptions to contracted prices, historical rebates, discounts, allowances and to current payment trends. We also considered the historical These arrangements result in deductions to gross sales in arriving at net sales and accuracy of the Group’s estimates in previous years. give rise to obligations for the Group to provide customers with rebates, discounts and allowances, which for unsettled amounts are recognised as an accrual. We formed an independent assessment of the most significant elements of the accrual at 31 December 2019 using third party data and compared this expecta- We focused on this area because rebates, discounts and allowances are complex tion to the actual accrual recognised. and because establishing an appropriate accrual requires significant judgement and estimation by Management. This judgement is particularly complex in a US healthcare environment in which competitive pricing pressure and product discounting are growing trends. Refer to note 2.1 and note 3.7. Litigations We discussed the status of significant known actual and potential litigations with in-house legal counsel. We have obtained and substantively tested evidence to The pharmaceuticals industry is heavily regulated which increases inherent litiga- support the decisions and rationale for provisions held or decisions not to recog- tion risk and litigation and contingent liabilities may arise from product-specific nise provisions, including correspondence with external legal counsel and other and general legal proceedings, from guarantees, marketing practices, unethical counter-parties and considered Management’s assessment of the probability of behaviour or government investigations connected with the Group’s activities. defending any litigation and the reliability of estimating any provisions. We focused on this area as the amounts involved are potentially material and We assessed litigation history and other available evidence to assess the valuation the valuation of the provision is based on application of material judgement and and completeness of the provisions recognised by the Group. We have obtained estimation and therefore is associated with uncertainty. Accordingly, unexpected confirmations from external legal counsel to confirm our understanding of adverse outcomes could significantly impact the Group’s reported profit and settled and outstanding litigation and asserted claims. We evaluated significant financial position. adjustments to legal provisions recorded during the year to determine if they were indicative of management bias. Refer to note 3.7. We tested the completeness of the external legal counsels from whom we have Novo Nordisk Annual Report 2019 asked for direct confirmation by testing legal expenses on a sample basis and comparing to internal documents.

Independent auditor’s report 89 Statement on Management’s Review • Obtain an understanding of internal control relevant to the audit in order to Management is responsible for Management’s Review, section ‘Managements design audit procedures that are appropriate in the circumstances, but not for review’. the purpose of expressing an opinion on the effectiveness of the Group’s and the Parent Company’s internal control. Our opinion on the Financial Statements does not cover Management’s Review, and we do not express any form of assurance conclusion thereon. • Evaluate the appropriateness of accounting policies used and the reasonable- ness of accounting estimates and related disclosures made by Management. In connection with our audit of the Financial Statements, our responsibility is to read Management’s Review and, in doing so, consider whether Management’s • Conclude on the appropriateness of Management’s use of the going concern Review is materially inconsistent with the Financial Statements or our knowledge basis of accounting and based on the audit evidence obtained, whether obtained in the audit, or otherwise appears to be materially misstated. a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s and the Parent Company’s ability to continue Moreover, we considered whether Management’s Review includes the disclosures as a going concern. If we conclude that a material uncertainty exists, we are required by the Danish Financial Statements Act. required to draw attention in our auditor’s report to the related disclosures in the Financial Statements or, if such disclosures are inadequate, to modify our Based on the work we have performed, in our view, Management’s Review is in opinion. Our conclusions are based on the audit evidence obtained up to the accordance with the Consolidated Financial Statements and the Parent Company date of our auditor’s report. However, future events or conditions may cause Financial Statements and has been prepared in accordance with the requirements the Group or the Parent Company to cease to continue as a going concern. of the Danish Financial Statements Act. We did not identify any material misstate- ment in Management’s Review. • Evaluate the overall presentation, structure and content of the Financial Statements, including the disclosures, and whether the Financial Statements Management’s responsibilities for the Financial Statements represent the underlying transactions and events in a manner that achieves fair Management is responsible for the preparation of consolidated financial state- presentation. ments that give a true and fair view in accordance with International Financial Reporting Standards as adopted by the EU and further requirements in the Danish • Obtain sufficient appropriate audit evidence regarding the financial information Financial Statements Act and for the preparation of parent company financial of the entities or business activities within the Group to express an opinion on statements that give a true and fair view in accordance with the Danish Financial the Consolidated Financial Statements. We are responsible for the direction, Statements Act, and for such internal control as Management determines is neces- supervision and performance of the group audit. We remain solely responsible sary to enable the preparation of financial statements that are free from material for our audit opinion. misstatement, whether due to fraud or error. We communicate with those charged with governance regarding, among other In preparing the Financial Statements, Management is responsible for assessing matters, the planned scope and timing of the audit and significant audit findings, the Group’s and the Parent Company’s ability to continue as a going concern, including any significant deficiencies in internal control that we identify during our disclosing, as applicable, matters related to going concern and using the going audit. concern basis of accounting unless Management either intends to liquidate the Group or the Parent Company or to cease operations, or has no realistic alterna- We also provide those charged with governance with a statement that we have tive but to do so. complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reason- Auditor’s responsibilities for the audit of the Financial Statements ably be thought to bear on our independence, and where applicable, related Our objectives are to obtain reasonable assurance about whether the Financial safeguards. Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable From the matters communicated with those charged with governance, we deter- assurance is a high level of assurance, but is not a guarantee that an audit mine those matters that were of most significance in the audit of the Financial conducted in accordance with ISAs and the additional requirements applicable in Statements of the current period and are therefore the key audit matters. We Denmark will always detect a material misstatement when it exists. Misstatements describe these matters in our auditor’s report unless law or regulation precludes can arise from fraud or error and are considered material if, individually or in the public disclosure about the matter or when, in extremely rare circumstances, we aggregate, they could reasonably be expected to influence the economic decisions determine that a matter should not be communicated in our report because the of users taken on the basis of these Financial Statements. adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. As part of an audit in accordance with ISAs and the additional requirements appli- cable in Denmark, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: • Identify and assess the risks of material misstatement of the Financial Hellerup, 5 February 2020 Statements, whether due to fraud or error, design and perform audit proce- dures responsive to those risks, and obtain audit evidence that is sufficient PricewaterhouseCoopers and appropriate to provide a basis for our opinion. The risk of not detecting a Statsautoriseret Revisionspartnerselskab material misstatement resulting from fraud is higher than for one resulting from CVR no 3377 1231 error, as fraud may involve collusion, forgery, intentional omissions, misrep- resentations, or the override of internal control. Mogens Nørgaard Mogensen Mads Melgaard State Authorised Public Accountant State Authorised Public Accountant mne21404 mne34354 Novo Nordisk Annual Report 2019

Independent assurance report 90 Independent limited assurance report on the consolidated social and environmental statements for 2019 To the Stakeholders of Novo Nordisk A/S • Performed limited substantive testing on a selective basis of the Selected Novo Nordisk A/S engaged us to provide limited assurance on the information Information at corporate head office to check that data had been appropriately described below and set out in the Annual Report of Novo Nordisk for the year measured, recorded, collated and reported. ended 31 December 2019. • Performed analysis of data from reporting sites, selected on the basis of risk and materiality to the group; and Our conclusion • Considered the presentation and disclosure of the Selected Information. Based on the procedures we have performed and the evidence we have obtained: A) Nothing has come to our attention that causes us to believe that the B) In respect of Novo Nordisk’s description of alignment with the AA1000 Consolidated social and environmental statements of Novo Nordisk’s Annual Accountability Principles (AA1000AP) (2018) of Inclusivity, Materiality, Report for the year ended 31 December 2019 has not been prepared, in all mate- Responsiveness and Impact we performed the following activities: rial respects, in accordance with the Reporting Criteria. • Interviewed members of Novo Nordisk’s Executive Management team, repre- B) Nothing has come to our attention that causes us to believe that the descrip- sentatives responsible for GLP-1 portfolio and market access at global level tion of Novo Nordisk’s alignment with the AA1000 Accountability Principles and in the US, key employees within Corporate Global Patient Access and (AA1000AP) (2018) of Inclusivity, Materiality, Responsiveness and Impact is not Corporate Sustainability to determine their understanding of their stakeholders, fairly stated. the mechanisms used to engage them and key issues that are of interest to each stakeholder group. This conclusion is to be read in the context of what we say in the remainder of our • Interviewed external stakeholders to determine their perception of Novo report. Nordisk’s capabilities in relation to stakeholder engagement, in particular, in relation to understanding and responding to material patient concerns, needs What we are assuring and desires. The scope of our work was limited to assurance over: • Reviewed evidence on a selective basis to support the assertions made in these A) The 'Consolidated social statement' and 'The consolidated environmental interviews and in the Stakeholder Engagement description. statement' and associated 'Notes‘, in the Annual Report of Novo Nordisk (the • Confirmed the existence of systems and procedures to support Novo Nordisk’s “Selected Information”). governance for responsible business conduct and stakeholder relationships. B) Novo Nordisk’s description of alignment with the AA1000AP principles of Our work focused on priorities and responsible decision-making relating to the Inclusivity, Materiality, Responsiveness and Impact for the year ended 31 December development, launch and rollout of oral semaglutide and how this aligns with 2019 which is set out in ‘Basis of preparation‘ in section ‘Consolidated social Novo Nordisk’s ambition of creating a sustainable business; and statement‘ (the “Stakeholder Engagement description”) of the Annual Report. • Assessed the disclosure and presentation of the Stakeholder Engagement description. Professional standards applied and level of assurance We performed a limited assurance engagement in accordance with International Novo Nordisk’s responsibilities Standard on Assurance Engagements 3000 (Revised) ‘Assurance Engagements Novo Nordisk’s management are responsible for: other than Audits and Reviews of Historical Financial Information’ and AA1000 • Designing, implementing and maintaining internal controls over information Assurance Standard (AA1000AS, 2008) with 2018 Addendum (Type 2, moderate, relevant to the preparation of the Selected Information that is free from mate- which is the equivalent to ISAE 3000 limited assurance). A limited assurance rial misstatement, whether due to fraud or error; engagement is substantially less in scope than a reasonable assurance engage- • Establishing objective Reporting Criteria for preparing the Selected Information; ment in relation to both the risk assessment procedures, including an under- • Measuring and reporting the Selected Information based on the Reporting standing of internal control, and the procedures performed in response to the Criteria; and assessed risks; consequently, the level of assurance obtained in a limited assurance • Reporting the Stakeholder Engagement description; and engagement is substantially lower than the assurance that would have been • The content of the Annual Report 2019. obtained had a reasonable assurance engagement been performed. Our responsibility Our independence and quality control We are responsible for: We have complied with the Code of Ethics for Professional Accountants issued • Planning and performing the engagement to obtain limited assurance about by the International Ethics Standards Board for Accountants, which includes whether the Selected Information and the Stakeholder Engagement description independence and other ethical requirements founded on fundamental principles is free from material misstatement, whether due to fraud or error; of integrity, objectivity, professional competence and due care, confidentiality • Forming an independent conclusion, based on the procedures we have and professional behaviour. We also qualify as independent as defined by the performed and the evidence we have obtained; and AA1000 Assurance Standard (AA1000AS, 2008) with 2018 Addendum. The firm • Reporting our conclusion to the Stakeholders of Novo Nordisk A/S. applies International Standard on Quality Control 1 and accordingly maintains a comprehensive system of quality control including documented policies and Observations and recommendations procedures regarding compliance with ethical requirements, professional standards According to AA1000AS with 2018 addendum, we are required to include and applicable legal and regulatory requirements. Our work was carried out by an observations and recommendations for improvements in relation to adherence to independent multidisciplinary team with experience in sustainability reporting and the AA1000APS principles. We have no significant recommendations regarding assurance. Inclusivity, Materiality, Responsiveness and Impact. We have communicated a number of minor recommendations for improvement to the management of Novo Understanding reporting and measurement methodologies Nordisk. The Selected Information needs to be read and understood together with the Reporting Criteria, sections ‘Consolidated social statement‘ and ‘Consolidated environmental statement‘, which Novo Nordisk A/S is solely responsible for Hellerup, 5 February 2020 selecting and applying. The absence of a significant body of established practice on which to draw to evaluate and measure non-financial information allows for different, but acceptable, measurement techniques and can affect comparability PricewaterhouseCoopers between entities and over time. Statsautoriseret Revisionspartnerselskab (CVR no. 3377 1231) Work performed A) We are required to plan and perform our work in order to consider the risk of material misstatement of the Selected Information. In doing so, we: • Conducted interviews with data owners to understand the key processes and control activities for reporting site performance data. Mogens Nørgaard Mogensen Mads Melgaard • Obtained an understanding of the key processes and controls for managing, State Authorised Public Accountant State Authorised Public Accountant Novo Nordisk Annual Report 2019 recording and reporting the Selected Information. mne21404 mne34354

Additional information 91 More information Additional reporting Novo Nordisk provides additional disclosure to The statutory Annual Report will be presented and Form 20 F satisfy legal requirements and stakeholder interests. adopted at the annual general meeting on 26 March The Form 20-F is filed using a standardised reporting Supplementary reports can be downloaded from 2020 and will subsequently be submitted to and be form so that investors can evaluate the company novonordisk.com/annualreport, while additional available at the Danish Business Authority. alongside US domestic equities. It is an annual information can be found at novonordisk.com reporting requirement by the US Securities and The Annual Report is prepared in accordance with Exchange Commission (SEC) for foreign private Materiality the International Financial Reporting Standards and issuers with equity shares listed on exchanges in the Novo Nordisk leans on the International Integrated the Danish Financial Statements Act. Moreover, it United States. Reporting Council’s definition of materiality. meets the requirements of an integrated report, Information deemed material for providers of finan- as per the International Integrated Reporting Remuneration report cial capital in their decision-making is included in the Framework. The remuneration report includes the total remu- Annual Report, ie of such relevance and importance neration received by each member of the Board of that it could substantively influence their assess- The Annual Report also meets the requirements Directors and the Executive Management of Novo ments of Novo Nordisk’s ability to create value over for Communication on Progress to the UN Global Nordisk A/S from 2016 to 2018. the short, medium and long term. See how Novo Compact, a voluntary reporting on performance Nordisk determines materiality and material issues at towards its 10 principles on human rights, labour Corporate governance report novonordisk.com rights, environment and anti-corruption and addi- The corporate governance report discloses Novo tional progress reporting on corporate sustainability Nordisk’s compliance with Danish Corporate Annual report leadership and UN goals. The Annual Report also Governance Recommendations to meet the require- This Annual Report is Novo Nordisk’s full statutory adheres to the UN Guiding Principles Reporting ments of the Danish Financial Statements Act. Annual Report pursuant to Section 149(1) of the Framework on respect of human rights. Danish Financial Statements Act. For more news from Novo Nordisk, visit novonordisk.com/investors Pursuant to section 149(2), a shortened version, novonordisk.com/media consisting of the Management Review and excerpts from the consolidated statements, is available in Danish. In the event of any discrepancies, the full statutory Annual Report shall prevail. References 1,5,6,10,11,12,21. International Diabetes Federation. IDF Diabetes Atlas, 9th edition, 2019. 2,13,15,16,17,18,22. World Health Organization. Obesity and Overweight, Fact sheet, 2018. 3. Iorio A. et al. Establishing the Prevalence and Prevalence at Birth of Hemophilia in Males, A Meta-analytic Approach Using National Registries. Annals of internal medicine, pp. 1-7, 2019. DOI: 10.7326/ M19-1208. 4. Vimpani G. et al. Prevalence of severe growth hormone deficiency. British Medical journal, pp. 427-430, 1977; Lindsay R. et al. Utah Growth Study: Growth standards and the prevalence of growth hormone deficiency. Pediatric, pp. 29-35, 1994; Thomas M. et al. Prevalence and demographic features of childhood growth hormone deficiency in Belgium during the period 1986–2001. European Journal of Endocrinology pp. 67–72, 2004. 7. Wright et al. Life Expectancy and Cause-Specific Mortality in Type 2 Diabetes: A Population-Based Cohort Study Quantifying Relationships in Ethnic Subgroups. Diabetes care, vol. 40, pp. 338-345, 2017, DOI: 10.2337/dc16-1616. 8. https://www.diabetes.org/diabetes/complications/stroke. 9. https://www. who.int/cardiovascular_diseases/en/. 14. https://www.worldobesity.org/about/about-obesity/prevalence-of-obesity. 19. Diehl A.M.and Day C., Cause, Pathogenesis, and Treatment of Nonalco- holic Steatohepatitis. N Engl J Med 2017. 20. Estes C. et al. Modeling the epidemic of nonalcoholic fatty liver disease demonstrates an exponential increase in burden of disease. Hepatology, pp. 123-133,2018,doi: 10.1002/hep.29466. 23. National Center for Chronic Disease Prevention and Health Promotion, National Diabetes Statistics Report, 2017, Estimates of Diabetes and Its Burden in the United States, pp. 1-20, 2017. 24. Centers for Disease Control & Prevention, Prevalence of Obesity Among Adults and Youth: United States, 2015–2016, pp. 1-8, 2017. 25. Waters H, Graf M. America's Obesity Crisis: The Health and Economic Costs of Excess Weight. pp. 1-30, 2018. Market data on pp 20-21 are from IQVIA, November, 2018 and 2019. Novo Nordisk Annual Report 2019 Design and production: Kontrapunkt. Digital version: Inviso. Photography: Martin Nordmark, Ulrik Jantzen, Jesper Edvardsen, Jesper Westley, Per Fledelius.

Additional information 92 Product overview Financial calendar 2020 5 February 2020 14 August 2020 Diabetes care Obesity care Financial statement Ex-dividend for 2019 and Annual New-generation insulin and combinations Glucagon-like peptide-1 Report 2019 17 August 2020 Tresiba®, insulin degludec Saxenda®, liraglutide 3 mg Record date Ryzodeg® 70/30, insulin degludec/insulin aspart 26 March 2020 Fiasp®, fast-acting insulin aspart Annual General 18 August 2020 Xultophy®*, insulin degludec/liraglutide meeting 2019 Payment, B shares Biopharm Modern insulin 27 March 2020 25 August 2020 Levemir®, insulin detemir Haemophilia Ex-dividend Payment, ADRs NovoRapid®**, insulin aspart NovoSeven®, recombinant factor VIIa, NovoRapid® PumpCart®, pre-filled insulin pump also available with pre-filled syringe in an 30 March 2020 30 October 2020 cartridge increasing number of countries Record date Financial statement for NovoMix® 30, biphasic insulin aspart NovoEight®***, recombinant factor VIII the first nine months NovoMix® 50, biphasic insulin aspart NovoThirteen®, recombinant factor XIII 31 March 2020 of 2020 NovoMix® 70, biphasic insulin aspart Refixia®****, Nonacog beta pegol; N9/GP Payment, B shares Esperoct®1, Turoctocog alfa pegol, N8-GP Human insulin 7 April 2020 Insulatard®, isophane (NPH) insulin Payment, ADRs Financial Human growth hormone Actrapid®, regular human insulin calendar 2021 Mixtard® 30, biphasic human insulin Norditropin®, somatropin (rDNA origin) 6 May 2020 Mixtard® 40, biphasic human insulin Norditropin® FlexPro®, pre-filled multidose Financial statement Mixtard® 50, biphasic human insulin delivery system for the first three 3 February 2021 Norditropin® NordiFlex®, pre-filled multi-dose months of 2020 Financial statement Glucagon-like peptide-1 delivery system for 2020 and Annual Victoza®, liraglutide Norditropin® NordiLet®, pre-filled multi-dose 6 August 2020 Report 2020 Ozempic®, semaglutide delivery system Financial statement Rybelsus®, oral semaglutide (only approved in the US) Norditropin® SimpleXx®, durable multi-dose for the first six delivery system months of 2020 Other pre-filled insulin delivery systems NordiPen®, prefilled multi-dose delivery system FlexTouch®, U100, U200 PenMate®, automatic needle inserter FlexPen® (for NordiPen® and NordiFlex®) InnoLet® Macrilen™, Macimorelin; growth hormone secretagogue receptor agonist Other insulin delivery systems PumpCart®, NovoRapid® cartridge to be used in Hormone replacement therapy pump Vagifem®, estradiol hemihydrate Cartridge Activelle®, estradiol/norethisterone acetate Headquarters Vial Kliogest®, estradiol/norethisterone acetate Novo Nordisk A/S Novofem®, estradiol/norethisterone acetate Novo Allé Insulin pens Trisequens®, estradiol/norethisterone acetate 2880 Bagsværd NovoPen® 5 Estrofem®, estradiol Denmark NovoPen® 4 NovoPen Echo®, with memory function * in the US approved under the brand name Xultophy® Tel +45 4444 8888 100/3.6 CVR number 24 25 67 90 Needles ** in the US called NovoLog® novonordisk.com ® ® *** in the US spelt Novoeight NovoFine Plus ® ® **** in the US approved under the name of REBINYN NovoFine 1approved in the US and received positive opinion in EU Investor Service NovoTwist® We welcome enquiries and feedback to the NovoFine® AutoCover® Annual Report via novonordisk.com/contact-us.html The product overview on this page makes reference to our 2019 product offering. The names used are European prod- Oral antidiabetic agents uct trade names with accompanying generic names. Trade Shareholders’ enquiries concerning dividend ® NovoNorm , repaglinide and generic names may differ in other markets. payments and shareholder accounts should be addressed to: shareholder@novonordisk.com Glucagon GlucaGen®, glucagon for diagnostic use ADR holders’ enquiries concerning dividend GlucaGen® Hypokit, glucagon emergency kit for payments, transfer of ADR certificates, consolidation severe hypoglycaemia of accounts and tracking of ADRs should be addressed to: JPMorgan Chase Bank, N.A Toll free number: Phone: 1 800 990 1135 Hearing impaired: Phone: 1 866 700 1652 Outside the U.S.: Phone: +1 651 453 2128 Regular correspondence: Shareowner Services P.O. Box 64504 St. Paul, MN 55164-0504 (From outside the United States) Novo Nordisk Annual Report 2019 StockTransfer@equiniti.com

Financial Statements of the Parent Company 93 Financial Statements of the Parent Company 2019 The following pages comprise the financial statements of the parent company, the legal entity Novo Nordisk A/S. Apart from ownership of the subsidiaries in the Novo Nordisk Group, activity within the parent company mainly comprises sales, research and development, production, corporate activities and support functions. Income Statement Balance sheet For the year ended 31 December At 31 December DKK million Note 2019 2018 DKK million Note 2019 2018 Net sales 2 93,440 84,752 Assets Cost of goods sold 3 17,940 16,457 Intangible assets 6 3,428 2,799 Property, plant and equipment 7 24,724 24,141 Gross profit 75,500 68,295 Financial assets 8 33,876 28,469 Sales and distribution costs 3 23,619 22,215 Deferred income tax assets 5 95 — Research and development costs 3 12,858 13,308 Other receivables and prepayments 239 — Administrative costs 3 1,837 1,746 Total non-current assets 62,362 55,409 Other operating income, net 2,204 2,214 Raw materials 2,357 1,951 Operating profit 39,390 33,240 Work in progress 9,761 9,191 Profit in subsidiaries, net of tax 8 10,497 11,485 Finished goods 2,590 1,922 Financial income 4 485 1,970 Inventories 14,708 13,064 Financial expenses 4 3,707 1,585 Trade receivables 1,687 1,847 Profit before income taxes 46,665 45,110 Amounts owed by affiliated companies 14,302 11,544 Income taxes 7,413 6,580 Tax receivables 295 884 Net profit for the year 39,252 38,530 Other receivables and prepayments 1,340 1,001 Receivables 17,624 15,276 Derivative financial instruments 9 188 204 Cash at bank 14,067 14,472 Total current assets 46,587 43,016 Total assets 108,949 98,425 Equity and liabilities Share capital 480 490 Net revaluation reserve according to the equity method 15,340 11,116 Development costs reserve 811 1,083 Retained earnings 40,801 38,816 Total equity 57,432 51,505 Borrowings 10 715 — Deferred income tax liabilities 5 — 137 Other provisions 11 995 739 Total non-current liabilities 1,710 876 Borrowings 10 165 2 Derivative financial instruments 9 734 2,024 Trade payables 2,673 2,368 Amounts owed to affiliated companies 40,754 36,108 Tax payables 74 33 Other liabilities 11 5,407 5,509 Total current liabilities 49,807 46,044 Total liabilities 51,517 46,920 Novo Nordisk Annual Report 2019 Total equity and liabilities 108,949 98,425

Financial Statements of the Parent Company 94 Equity statement Net Develop- Share revaluation ment costs Retained DKK million capital reserve reserve earnings 2019 2018 Balance at the beginning of the year 490 11,116 1,083 38,816 51,505 49,284 Appropriated from Net profit for the year 15,377 15,377 22,452 Total dividend for the year 19,651 19,651 19,547 Appropriated from Net profit for the year to net revaluation reserve 4,224 4,224 (3,469) Effect of cash flow hedges transferred to the income statement 1,506 1,506 (1,820) Fair value adjustments of cash flow hedges for the year (323) (323) (1,506) Interim dividends paid during the year (7,100) (7,100) (7,238) Dividends paid for prior year (12,309) (12,309) (11,810) Share-based payments (note 3) 148 148 199 Tax credit related to restricted stock units 16 16 (2) Purchase of treasury shares (15,334) (15,334) (15,567) Reduction of the B share capital (10) 10 — — Exchange rate adjustments of investments in subsidiaries 226 226 491 Development costs (272) 272 — — Other adjustments (155) (155) 944 Balance at the end of the year 480 15,340 811 40,801 57,432 51,505 Proposed appropriation of net profit: Interim dividend for the year 7,100 7,238 Final dividend for the year 12,551 12,309 Appropriated to Net revaluation reserve 4,224 (3,469) Transferred to Retained earnings 15,377 22,452 Distribution of net profit 39,252 38,530 Please refer to note 4.1 in the consolidated financial statements regarding average number of shares, treasury shares and total number of A and B shares in Novo Nordisk A/S. Novo Nordisk Annual Report 2019

Financial Statements of the Parent Company 95 Notes 1 Accounting policies Supplementary accounting policies for the parent company The financial statements of the parent company have been prepared in accord- ance with the Danish Financial Statements Act (Class D) and other accounting Financial assets regulations for companies listed on Nasdaq Copenhagen. In the financial statements of the parent company, investments in subsidiaries and associated companies are recorded under the equity method, using the respective The accounting policies for the financial statements of the parent company are share of the net asset values in subsidiaries and associated companies. Net profit unchanged from the previous financial year except for a change of accounting of subsidiaries and associated company less unrealised intra-group profits is policy for leases and changed presentation of the balance sheet. The accounting recorded in the income statement of the parent companies. policies are the same as for the consolidated financial statements with the adjust- ments described below. For a description of the accounting policies of the group, To the extent that net profit exceeds declared dividends from such companies, please refer to the consolidated financial statements. net revaluation of investments in subsidiaries and associated companies are trans- ferred to Net revaluation reserve under equity according to the equity method. No separate statement of cash flows has been prepared for the parent company; Profits in subsidiaries and associated companies are disclosed as profit after tax. please refer to the statement of cash flows for the group. Tax Change of presentation of balance sheet For Danish tax purposes, the parent company is assessed jointly with its Danish The parent company has changed the presentation of the balance sheet to align subsidiaries. The Danish jointly taxed companies are included in a Danish on-ac- to the balance sheet for the Group. Deferred tax asset is now being presented as count tax payment scheme for Danish corporate income tax. All current taxes a non-current asset and provisions are now being presented as non-current and under the scheme are recorded in the individual companies. Novo Nordisk A/S and current liabilities. The change had no impact on recognised amounts. its Danish subsidiaries are included in the joint taxation of the parent company, Novo Holdings A/S. Change of accounting policy for leasing As of 1 January 2019, the parent company has changed accounting policy for Uncertain tax positions are presented individually as part of Tax receivables/Tax leases from using IAS 17 for interpretation of the Danish Financial Statements Act payables. to using IFRS 16. The parent company implemented IFRS 15 as interpretation for revenue in the financial statements for 2018. Novo Nordisk recognises deferred income tax assets, if it is probable that sufficient taxable income will be available in the future, against which the temporary differ- The change has been applied by using the modified retrospective approach. ences can be utilised. Under this method, the cumulative effect of initially applying the standard is recognised at 1 January 2019. Rights-of-use assets and lease liabilities have been recognised for those leases previously classified as operating leases, except for 2 Sales short-term leases and leases of low value assets. The rights-of-use assets have DKK million 2019 2018 been recognised based on the amount equal to the lease liabilities, adjusted for any related prepaid and accrued lease payments previously recognised. Lease Sales by business segment liabilities are recognised based on the present value of the remaining lease Diabetes and Obesity care 93,192 84,573 payments, discounted using the incremental borrowing rate as of 1 January Biopharm 248 179 2019. The comparative information has not been restated. The weighted average incremental borrowing rate applied on transition to IFRS 16 for parent company Total sales 93,440 84,752 was 1.20%. Sales by geographical segment For a description of the transition method used and for a description of the North America Operations 50,326 47,942 new accounting policies please refer to note 1.2 in the consolidated financial Region Europe 16,615 14,445 statements. Region China 10,326 8,962 Region AAMEO 9,808 8,490 The impact of the change in accounting policy is recognition of additional Region Latin America 3,030 2,339 DKK 1,010 million of property, plant and equipment and DKK 1,010 million of Region Japan & Korea 3,335 2,574 borrowings. The change in policy has had an insignificant impact on the income statement for 2019. Total sales 93,440 84,752 Reconciliation of lease liabilities pursuant to change of accounting policy Sales are attributed to geographical segment based on location of the customer. DKK million For definitions of segments, please refer to note 2.2 in the consolidated financial statements. Operating leases commitments as disclosed in the parent company’s 2018 financial statement 1,296 3 Employee costs Recognition exemptions: DKK million 2019 2018 Short-term leases (23) Wages and salaries 10,668 11,423 Leases of low value assets (24) Share-based payment costs 148 199 Variable lease payments (187) Pensions 1,009 1,028 Other (7) Other social security contributions 197 212 Lease liability on transition (undiscounted) 1,055 Other employee costs 393 346 Discounted using the parent company’s incremental bor- Total employee costs in the income statement 12,415 13,208 rowing rate at 1 January 2019 1.20% Lease liability recognised on transition 1,010 Average number of full-time employees 15,550 16,244 Year-end number of full-time employees 15,442 16,094 For information regarding remuneration to the Board of Directors and Executive Management, please refer to note 2.4 in the consolidated financial statements. Novo Nordisk Annual Report 2019

Financial Statements of the Parent Company 96 4 Financial income and financial expenses 5 Deferred income tax assets/(liabilities) DKK million 2019 2018 DKK million 2019 2018 Interest income relating to subsidiaries 432 297 Net deferred tax asset/(liability) at the beginning Income from associated company 36 40 of the year (137) (856) Financial gain from forward contracts (net) — 1,300 Income/(charge) to the income statement 460 30 Other financial income 17 333 Income/(charge) to Equity (228) 689 Total financial income 485 1,970 Net deferred tax asset/(liability) at the end of the year 95 (137) Interest expenses relating to subsidiaries 588 483 Foreign exchange loss (net) 426 1,018 Financial loss from forward contracts (net) 2,470 — The Danish corporate tax rate was 22% in 2019 (22.0% in 2018). Other financial expenses 223 84 Total financial expenses 3,707 1,585 6 Intangible assets DKK million 2019 2018 Cost at the beginning of the year 6,032 4,765 Additions during the year 1,190 1,267 Disposals during the year (12) — Cost at the end of the year 7,210 6,032 Amortisation at the beginning of the year 3,233 2,319 Amortisation during the year 271 914 Impairment losses for the year 290 — Amortisation and impairment losses reversed on disposals during the year (12) — Amortisation at the end of the year 3,782 3,233 Carrying amount at the end of the year 3,428 2,799 Intangible assets primarily relate to patents and licences, internally developed software and costs related to major IT projects. 7 Property, plant and equipment Assets in Land and Plant and Other course of DKK million buildings machinery equipment construction 2019 2018 Cost at the beginning of the year 19,140 19,063 3,230 5,859 47,292 46,099 Change of accounting policy for leases 965 — 45 — 1,010 — Additions during the year 176 361 140 1,344 2,021 2,791 Disposals during the year (146) (436) (175) (21) (778) (1,598) Transfer from/(to) other items 622 1,828 492 (2,942) — — Cost at the end of the year 20,757 20,816 3,732 4,240 49,545 47,292 Depreciation and impairment losses at the beginning of the year 7,365 13,834 1,952 — 23,151 22,685 Depreciation for the year 1,077 899 307 — 2,283 1,881 Impairment losses for the year 55 70 18 21 164 112 Depreciation reversed on disposals during the year (145) (436) (175) (21) (777) (1,527) Depreciation and impairment losses at the end of the year 8,352 14,367 2,102 — 24,821 23,151 Carrying amount at the end of the year 12,405 6,449 1,630 4,240 24,724 24,141 Of which related to leased property, plant and equipment 826 — 51 — 877 — Leased property, plant and equipment primary relates to lease of office buildings, warehouses, laboratories and vehicles. Novo Nordisk Annual Report 2019

Financial Statements of the Parent Company 97 8 Financial assets Amounts Investment Other owed by in securities Investments in affiliated associated and DKK million subsidiaries companies company investments 2019 2018 Cost at the beginning of the year 8,933 7,432 105 807 17,277 14,405 Investments during the year 3,744 1,274 391 5,409 3,545 Divestments during the year (3,744) (449) (4,193) (673) Cost at the end of the year 8,933 8,257 105 1,198 18,493 17,277 Value adjustments at the beginning of the year 28,784 115 92 (39) 28,952 30,591 Profit/(loss) before tax 16,514 16,514 15,329 Share of result after tax in associated company 36 36 40 Income taxes on profit for the year (2,226) (2,226) (2,323) Market value adjustment (187) (187) 129 Dividends received (6,300) (20) (6,320) (15,694) Divestments during the year — 44 Effect of exchange rate adjustment 296 152 2 450 698 Other adjustments (215) (215) 138 Transfer between unrealised internal profit and value adjustment (8,201) (8,201) — Value adjustments at the end of the year 28,652 267 108 (224) 28,803 28,952 Unrealised internal profit at the beginning of the year (17,760) (17,760) (16,382) Unrealised internal profit movements in the year (3,791) (3,791) (1,521) Effect of exchange rate adjustment (70) (70) 143 Transfer between unrealised internal profit and value adjustment 8,201 8,201 — Unrealised internal profit at the end of the year (13,420) — — — (13,420) (17,760) Carrying amount at the end of the year 24,165 8,524 213 974 33,876 28,469 Carrying amount of investments in subsidiaries does not include capitalised goodwill at the end of the year. For a list of companies in the Novo Nordisk group, please refer to note 5.5 to the consolidated financial statements. 9 Derivatives 13 Fee to statutory auditors For information on derivative financial instruments, please refer to note 4.4 in the DKK million 2019 2018 consolidated financial statements. Statutory audit 8 8 10 Borrowings Audit-related services 3 3 DKK million 2019 2018 Tax advisory services 6 4 Other services 3 2 Within 1 year 165 2 1-5 years 523 — Total fee to statutory auditors 20 17 More than 5 years 192 — Total borrowings 880 2 14 Commitments and contingencies DKK million 2019 2018 Borrowings at end of 2019 are related to lease liabilities. Commitments Leases1 175 1,296 11 Other provisions Potential milestone payments2 4,464 3,004 Provisions for pending litigations are recognised as Other provisions. Furthermore, Guarantees given for subsidiaries 10,011 9,898 as part of normal business Novo Nordisk issues credit notes for expired goods. Other guarantees 130 171 Consequently, a provision for future returns is made, based on historical product return statistics. 1. Leases for 2019 predominantly relate to estimated variable property taxes and low value assets. Leases for 2018 reflect operating lease commitment. For information on pending litigations, please refer to note 3.7 in the consolidated 2. Potential milestone payments are associated with uncertainty as they are linked to financial statements. successful achievements in research activities; please refer to note 5.2 in the consolidated financial statements. 12 Related party transactions For information on transactions with related parties, please refer to note 5.3 in the Novo Nordisk A/S and its Danish subsidiaries are jointly taxed with the Danish consolidated financial statements. companies in Novo Holdings A/S. The joint taxation also covers withholding taxes in the form of dividend tax, royalty tax and interest tax. The Danish companies Transactions with CS Solar Fund XIV disclosed in note 5.3 in the consolidated are jointly and severally liable for the joint taxation. Any subsequent adjustments financial statements are not related to the parent company. The parent company’s to income taxes and withholding taxes may lead to a larger liability. The tax for share of services provided by NNIT Group amounts to DKK 758 million. the individual companies is allocated in full on the basis of the expected taxable income. Novo Nordisk A/S is included in the consolidated financial statements of Novo Nordisk Foundation. For information on pending litigation and other contingencies, please refer to notes 3.7 and 5.2 in the consolidated financial statements. Novo Nordisk Annual Report 2019

SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf of the undersigned, thereunto duly authorized. Date: February 5, 2020 Novo Nordisk A/S Lars Fruergaard Jørgensen Chief Executive Officer