Novo Nordisk A/S NVO reported fourth-quarter 2016 earnings of 50 cents per American Depositary Receipt (ADR), missing the Zacks Consensus Estimate of 52 cents by 3.8%. Reported earnings, however, surpassed the year ago figure of 48 cents.

Quarterly revenues were up 1.2% year over year (up 3% in local currency) to $4.29 billion. However, reported revenue figure came below the Zacks Consensus Estimate of $4.33 billion.

Novo Nordisk’s share price has declined 2.5% in the past three months, while the Zacks classified Large Cap Pharmaceuticals industry gained 2.9%.

All growth rates mentioned below are on a year-over-year basis and in local currency.

Quarter in Detail

In the reported quarter, the company’s top line was driven by strong sales of Victoza, Tresiba, Saxenda and Norditropin. But it was partly offset by the softer performance of modern insulin and other biopharmaceuticals due to the launch of a generic version of Vagifem in the USA. The International Operations (16%) and China (15%) segments did well in the quarter. In the U.S., sales remained unchanged as strong Victoza and Saxenda growth as well as the sales from newly introduced Tresiba in the basal insulin segment was offset by lower sales of Vagifem.

Novo Nordisk operates through two segments – Diabetes and obesity care, and Biopharmaceuticals.

The Diabetes and Obesity Care segment recorded sales growth of 5%. Modern insulin dropped 8% due to lower sales of NovoRapid (2%), NovoMix (5%) and Levemir (17%). Meanwhile, the company’s key drug, Victoza, recorded sales growth of 10%.

Sales at the Biopharmaceuticals segment inched up 2%. Norditropin sales grew 8% and hemophilia sales were up 2%.

Research and development expenses were up 11% due to higher research costs related to diabetes and obesity projects. Administrative costs increased slightly by 1% mainly due to cost control across the organization.

Sales and distribution costs decreased by 1% mainly due to cost management in the U.S. but were partially offset by promotional activities in Europe and Region Pacific.