Novartis’ earning declines 4 percent to $4.28 billion; Outlook of Sandoz improves | The Financial Express

Novartis’ earning declines 4 percent to $4.28 billion; Outlook of Sandoz improves

Novartis also announced that Richard Saynor, will be appointed CEO designate of Sandoz and step down from the Executive Committee of Novartis with immediate effect.

Novartis’ earning declines 4 percent to $4.28 billion; Outlook of Sandoz improves
Moreover, iptacopan is also being investigated in Phase III studies for several other disorders too. (File)

Swiss drugmaker Novartis on Tuesday announced its quarterly results and it revealed that the company’s quarterly operating income slipped as competition weighed on prescriptions of the multiple sclerosis drug Gilenya. However, the earnings outlook at the generic-drugs unit Sandoz perked up again.

Reportedly, a strong U.S. currency was also a drag on the value of sales generated outside the United States.

The Net sales of the company were USD 12.5 billion (-4%, +4% cc) in the third quarter, driven by volume growth of 11 percentage points, price erosion of 4 percentage points, and the negative impact from the generic competition of 3 percentage points.

Moreover, the third-quarter group core operating income declined 4% to $4.28 billion, slightly below the average analyst consensus of $4.30 billion.

The company also announced a new focused strategy with their transformation into a “pure-play” Innovative Medicines business.

“We have a clear focus on five core therapeutic areas (cardiovascular, immunology, neuroscience, solid tumors and hematology), with multiple significant in-market and pipeline assets in each of these areas, that address high disease burden and have substantial growth potential. In addition to two established technology platforms (chemistry and biotherapeutics), three emerging platforms (gene & cell therapy, radioligand therapy, and xRNA) are being prioritized for continued investment into new R&D capabilities and manufacturing scale. Geographically, we are focused on growing in our priority geographies – the US, China, Germany and Japan,” the company stated on Tuesday.

The company also announced that the net sales of innovative Medicines were USD 10.3 billion (-3%, +4% cc) with volume contributing 12 percentage points to growth. Sales growth was mainly driven by a continued strong performance from Entresto, Kesimpta, Kisqali, Cosentyx, and the Pluvicto launch.

Moreover, generic competition had a negative impact of 4 percentage points, mainly due to Afinitor/Votubia, Gilenya (ex-US), Gleevec/Glivec and Exjade. Pricing had a negative impact of 4 percentage points. Sales in the US were USD 4.1 billion (+8%) and in the rest of the world USD 6.2 billion (-9%, +2% cc), the company stated.

“Novartis delivered a solid third quarter, with strong YTD operational performance. Our six in-market growth drivers with multi-billion sales potential (Cosentyx, Entresto, Zolgensma, Kisqali, Kesimpta, Leqvio) grew 23% in the quarter and now represent 33% of total IM sales. Pluvicto and Scemblix launches are progressing well and we are awaiting data in earlier lines of therapy. We announced the planned separation of Sandoz by way of a 100% spin-off, creating the #1 European generics company and a global leader in biosimilars. Looking ahead, we are confident in delivering growth and margin expansion through our new focused “pure-play” Innovative Medicines strategy, underpinned by our five core TAs, technology platforms, priority geographies and a deep, value-oriented pipeline,” Vas Narasimhan MD, CEO of Novartis, said while commenting on the quarter.

Novartis also announced that Richard Saynor, will be appointed CEO designate of Sandoz and step down from the Executive Committee of Novartis with immediate effect. He will continue to report directly to Vas Narasimhan and lead the Sandoz division, the company stated.

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First published on: 25-10-2022 at 12:19 IST