Novo Nordisk Annual Report 2021

Contents Introducing Novo Nordisk Strategic Aspirations Key risks Management Consolidated statements Additional information Novo Nordisk Annual Report 2021 79 The purchase price allocation for the acquisition is considered provisional due to the fact that the transaction was closed on 28 December 2021, leaving limited time to identify and determine fair value of assets acquired and liabilities assumed. Adjustments may be applied to the purchase price allocation for a period of up to 12 months from the acquisition date. The provisional fair value of recognised assets and liabilities is as follows: DKK million Intellectual property rights 2021 18,687 Other intangible assets 24 Financial assets 31 Cash 3,033 Deferred tax assets/liabilities, net (3,480) Other net assets (607) Net identifiable assets acquired 17,688 Goodwill 4,346 Purchase price 22,034 Settlement of pre-existing relationship (145) Fair value of existing shareholdings (573) Consideration transferred 21,316 Cash acquired Cash used for acquisition of businesses (3,033) 18,283 The goodwill is primarily attributable to the highly-skilled workforce and expected synergies generated from Novo Nordisk's know-how and commercialisation abilities within protein and peptide based medicines and Dicerna Pharmaceuticals, Inc.'s know-how within RNAi technology. The goodwill is not expected to be deductible for tax purposes. Transaction costs of DKK 124 million are included in other operating income and expenses in the income statement. Business combinations in 2020 No business combinations were completed in 2020. Accounting policies The acquisition method of accounting is used to account for all business combinations. The purchase price for a business comprises the fair values of the assets transferred, liabilities incurred to the former owners including warrant holders of the acquired business and the fair value of any asset or liability resulting from a contingent consideration arrangement. Any amount of the purchase price which effectively comprises a settlement of a pre-existing relationship is not part of the exchange for the acquiree and is therefore not included in the consideration for the purpose of applying the acquisition method. Settlements of pre-existing relationships are accounted for as separate transactions in accordance with the relevant IFRS. Identifiable assets and liabilities and contingent liabilities assumed are measured at fair value at the date of acquisition by applying relevant valuation methods. Acquisition-related costs are expensed as incurred. Goodwill is recognised at the excess of purchase price over the fair value of net identifiable assets acquired and liabilities assumed. Key accounting estimate in determining the fair value of intangible assets acquired in a business combination The application of the acquisition method involves the use of significant estimates as the identifiable net assets of the acquiree are recognised at their fair value for which observable market prices are typically not available. This is particularly relevant for intangible assets which require use of valuation techniques typically based on estimates of present value of future uncertain cash flows. The valuation of intellectual property rights identified in the acquisition of Dicerna Pharmaceuticals, Inc. is mainly based on Relief From Royalty models, where Management has estimated the net present value of royalties and milestone payments, if the existing research collaboration and license agreement had been extended in time and scope to cover all of the proprietary RNAi technology. Further, Pipeline assets and research collaboration and license agreements with other parties than Novo Nordisk are valued based on estimated net present value of future cash flows. 5.4 Related party transactions Material transactions with related parties 2021 2020 2019 DKK million Novo Holdings A/S Purchase of Novo Nordisk B shares 6,695 5,963 4,894 Dividend payment to Novo 6,144 5,767 5,580 Holdings A/S NNIT Group $8 Services provided by NNIT 593 775 941 Dividend payment from NNIT Novozymes Group (4) (18) (20) Services provided by Novo Nordisk Services provided by Novozymes CS Solar Fund XIV Purchase of shares by Novo Nordisk Liability for capital commitment¹ Distribution by CS Solar Fund XIV (116) 78 (113) 72 (132) 103 1. The liability disclosed for 2019 related to capital commitment was paid in 2020 (DKK 392 million).. Novo Nordisk A/S is controlled by Novo Holdings A/S (incorporated in Denmark), which owns 28.1% of the share capital in Novo Nordisk A/S, representing 76.7% of the total number of votes. The remaining shares are widely held. The ultimate parent of the Group is the Novo Nordisk Foundation (incorporated in Denmark). Both entities are considered related parties. 97 389 (385) 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 associated company of Novo Holdings A/S, Unchained Labs, Inc. and Altascience Company Inc. are considered related parties to Novo Nordisk A/S. As they share a controlling shareholder, the Novozymes Group, Sonion Group and Xellia Pharmaceuticals are also considered to be related parties, as well as the Board of Directors or Executive Management of Novo Nordisk A/S.

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