Novartis Q1 earnings slide down
pharmafile | April 26, 2012 | News story | Sales and Marketing | Novartis, Q1, Sandoz, generics, gilenya
Generic competition and problems at a US plant were among the reasons why Novartis’ sales and profit dipped in the first quarter of 2012.
Revenue at the Swiss pharma company fell 2% year on year to $13.74 billion in the first three months of the year, while net profit was down 18% to $2.33 billion.
Chief executive Joseph Jimenez admitted it had been a ‘challenging’ quarter, with the firm also expecting full-year profits to be lower than last year.
He added that Novartis is ‘making progress’ at the manufacturing site in Lincoln, Nebraska after the FDA found evidence of some packaging mix-ups: a temporary shut-down there cost Novartis $200 million, however.
Its generics arm Sandoz also saw sales fall 10% year on year to $2.12 billion between January and March.
Pharmaceuticals overall saw net sales growth of 2% to $7.8 billion, with products launched since 2007 generating $2.6 billion.
One of these is MS treatment Gilenya: a recent European review of the drug concluded it should stay on the market, but that patients must receive closer monitoring of heart function and blood pressure.
“We are pleased with the outcome of the safety review on Gilenya and expect to see continued strong sales growth,” Jiminex said.
While good news for Novartis, the new warnings will inevitably limit Gilenya’s commercial potential.
Last year Novartis announced it was cutting 2,000 jobs in the US and Switzerland over the next three to five years, a restructuring which in part led to a $147m charge in the first quarter.
However, the firm enjoys a strong pipeline and has been buoyed by recent Phase III results on QVA149 in chronic obstructive pulmonary disease (COPD), where four trials all met their primary endpoints.
Adam Hill
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