* Danish FSA reports Novo to police over slow Tresiba report
* Novo did not reveal Feb. 8 setback in U.S. until Feb. 10
* Novo shares plummeted on Feb. 11 following news
* Company may face Danish fine of $9,000 to $36,000
By Shida Chayesteh
COPENHAGEN, Dec 10 (Reuters) - Novo Nordisk, theworld's largest insulin maker, is facing a Danish police probeafter it was reported by the financial watchdog for notdisclosing at once that its big new product hope Tresiba hadbeen refused U.S. approval.
Although the probe is unlikely to have a serious financialimpact on the company, the largest by market value in the Nordicregion, it may tarnish its reputation and could leave it open tolawsuits from investors in the United States, where its sharesalso trade.
The Danish Financial Supervisory Authority (FSA) said onTuesday Novo should have issued a statement about the U.S.decision not to approve Tresiba, its new long-acting insulin, onthe evening of Friday, Feb. 8 instead of waiting until Sunday,Feb. 10.
The news that the Food and Drug Administration (FDA) hadrejected Tresiba, a treatment for diabetes, and a relatedcombination drug called Ryzodeg was a major blow to Novo andconfounded the expectations of investors, who had expected agreen light.
Shares in Novo fell as much as 17 percent at one stage onFeb. 11, their biggest daily decline since 2002.
Novo said on Tuesday its announcement about Tresiba wasissued "in a timely manner". However the company said it wouldcooperate with the investigation, which could result in a modestfine.
Hanne Rae Larsen, head of the FSA's stock exchange division,said fines for disclosure violations were typically in the rangeof 50,000 to 200,000 Danish crowns ($9,000-37,000), a fractionof the 21.4 billion crowns net profit Novo made last year.
"When the case goes over to the police, they will usuallytry to close it with a fine. If Novo Nordisk accepts anysanction, the case will close. If Novo does not recognise thatthere has been a violation, there will be a lawsuit," she toldReuters.
Sydbank analyst Soren Lontoft Hansen said: "It will costthem more in terms of image than it will financially. What mightbe a bigger problem financially is if U.S. shareholders gettogether in a joint action."
A police spokesman said it was still awaiting details of thecase to be passed on from the FSA.
The drugmaker argues that even if the disclosure obligationapplied from Friday evening - the time it received the bad newsfrom the FDA - it was entitled to delay an announcement until ithad analysed the implications.
But the situation is complicated by the fact that althoughthe FDA news came after the Danish market was closed, it wasstill possible to trade Novo shares over the counter and throughbanking systems. Furthermore, trading in Novo's Americandepository receipts was still active.
A Novo spokesman said the company's U.S. unit receivednotification from the FDA at around 5 p.m. Danish time on Feb.8, just as the Copenhagen market was closing, but it only sentthe message on to headquarters "some hours" later.
There was an internal conference call about the matterbetween 9 p.m. and 10 p.m. that night and Novo finally publishedthe information on Sunday, Feb. 10, at 9.09 p.m., according tothe FSA.
Novo has benefited more than any other company from a globalepidemic of type 2 diabetes, which in recent years has fuelleddemand for its products and lifted its shares to a lofty premiumover other European drugmakers.
Tresiba was widely seen as another sure-fire winner,especially as the drug had already won approval in Europe andJapan, and also got a positive recommendation from an advisorypanel to the U.S. FDA in November 2012.
In the event, the FDA requested additional data from a newclinical trial focused on cardiovascular side-effects before itwould consider approving Tresiba.
The U.S. setback, which will delay Tresiba's launch in theworld's biggest market by several years, is good news for rivalmakers of insulin medicines, notably France's Sanofi,whose Lantus product is threatened by Novo's newerultra-long-lasting treatment.
Novo noted that the Copenhagen stock market had launched asimilar investigation in February into whether it had violatedspecific stock exchange disclosure rules, but had concluded inMay that there was no case to answer.
The FSA, however, said the fact the local market was closedhad no bearing on Novo's disclosure obligations under theSecurity Trading Act.
Shares in Novo were 0.6 percent lower by 1026 GMT, slightlyunderperforming a 0.3 decline in the European pharmaceuticalssector.
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