By Jacob Gronholt-Pedersen

COPENHAGEN, June 2 (Reuters) - Novo Nordisk, the world's biggest maker of diabetes drugs, will focus on growing volumes rather than price in its key European market where it has lost ground to competitors in recent years, a senior executive said on Friday.

Novo Nordisk's share of the European insulin market, its biggest outside North America, has gradually dropped in the last 6-7 years to around 45 percent.

"One of the pitfalls of a (market) leader is often that you become your own comparator. So you achieve your targets and it's all good. We need to look to market share and market growth as part of how we judge ourselves," Maziar Mike Doustdar, who oversees Novo Nordisk global operations outside North America, told Reuters in an interview.

Novo's main rivals in the diabetes market are Sanofi and Eli Lilly.

With public health care budgets under pressure due to slower economic growth and ageing populations, European governments have been more reluctant to pay extra for more innovative products.

"The price part of the formula is more under pressure than ever before and will not be the same as it was in the past, regardless of geography," said Doustdar.

"So the volume part becomes more important, if you want to generate the same or higher value," he said.

Novo Nordisk this week hired Matt Regan from AbbVie as new head of its European operations to replace Jerzy Gruhn, who left the company last year.

He will oversee a region that accounted for 18 percent of sales in the first quarter and will be tasked with regaining market share from competitors while also getting Novo's new innovative products on the shelves.

"Health care budgets in Europe have been under pressure, and competition has also increased," said Doustdar, noting that when Novo launched its new Tresiba insulin drug in Europe 2-3 years ago, governments were reluctant to reimburse before prices began to come down.

"This requires us to have a longer dialogue (with governments) to try and see what is the right price level that also gives us access. It doesn't make sense to price your products at a level where you can't introduce them."

Hit by pricing pressure in its core insulin business, Novo Nordisk is looking at new treatments for obesity - a major cause of diabetes - to help revive its growth.

As the world's biggest maker of diabetes drugs, Novo has enjoyed two decades of stellar growth, but a squeeze on prices in the key U.S. market has tarnished its reputation for reliable growth and Chief Executive Lars Fruergaard Jorgensen said last month he expects "continued price erosion".

European countries spend around $156 billion each year on the estimated 60 million people with diabetes, according to the International Diabetes Federation. ($1 = 6.6030 Danish crowns) (Reporting by Jacob Gronholt-Pedersen; Editing by Keith Weir)