Novartis’ 2012 results flat
pharmafile | January 24, 2013 | News story | Sales and Marketing | Bexsero, Jakavi, Novartis, generics, results
Generic competition has put a dent in Novartis’ financial results for 2012, with net sales down 3% year on year to $56.7 billion.
The company has also warned there will be a mid-single digit fall in profit in 2013 as loss of exclusivity on various products – in particular its former top-earning blood pressure drug Diovan – takes $3.5 billion off sales.
The Swiss group says its recently-launched products covered the loss of patents on others over the past year, but core net profit overall was still down 5% to $12.8 billion.
Pharma sales fell 1% to $32.2 billion, with generic competitors knocking $1.9 billion off turnover, although Novartis’ newer products grew 28% to $11.4 billion, providing 35% of pharma’s total net sales (2011: 28 per cent).
But pharma’s core operating profit grew 2% to $10.2 billion, providing some relief. Elsewhere in Novartis’ drugs business, Alcon’s net sales rose 3% to $10.2 billion, with profit up 6% to $3.7 billion – but the numbers are not ideal in other health segments.
Performance at Novartis’ consumer health operation was eviscerated by the continuing absence of shipments from its Nebraska manufacturing site. Net sales fell 19% to $3.7 billion, with operating profit down a whopping 93% to $48 million.
Vaccines and diagnostics sales were also down 7% to $1.9 billion with operating profit dropping 82% to $159 million, again largely due to problems and upgrade costs at the Lincoln site.
And sales at the group’s generics division Sandoz were likewise down 8% to $8.7 billion, with core operating profit dipping 22% to $1.5 billion.
Novartis chief executive Joseph Jimenez put a positive spin on the figures, pointing to a pipeline expected to deliver 14 blockbuster products by 2017, up from 8 in 2012, and said evidence of innovation at the company came from 17 major approvals last year.
These include Jakavi, a new treatment for patients with myelofibrosis, and meningitis vaccine Bexsero.
“After our 2013 patent expirations are behind us, our relentless focus on innovation, growth, and productivity is expected to result in group net sales growth of at least mid-single digits in both 2014 and 2015, with core operating income growing ahead of sales,” he added.
There is also to be a major change at the top of the company, with chairman Daniel Vasella stepping down next month after 17 years, and Bayer’s Jorg Reinhardt set to replace him.
Adam Hill
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