07.21.14
Headquarters: Basel, Switzerland
twitter.com/novartis
www.novartis.com
TOP SELLING DRUGS
In 2012, Novartis’ senior managemers told the press that the company could have as many as 14 blockbuster drugs on the market through 2017. Novartis had over 200 products in clinical development last year, 144 of them developed by its pharmaceuticals division.
Sandoz, the company’s generic drugs division, has launched new biosimilar development programs, and is now in Phase III clinical trials for etanerecept (Enbrel) and adalimumab (Humira).
Last year, three of Novartis’ pharmaceutical division’s drug candidates received Breakthrough Therapy designations from the FDA, warranting expedited review: LDK378, for lung cancer, BYM338 for myositis, and RLX030 (serelaxin) for acute heart failure. Heart failure, Novartis noted, is an area where few successful drugs have been introduced, and this was to be “the first acute heart failure treatment breakthrough in more than 20 years.”
However, just as the FDA giveth, it can also take away. This Spring, FDA reviewers rejected serelaxin, saying more evidence of efficacy was required for approval.
Novartis has coped with market challenges by minimizing costs and increasing its focus on its three key business areas: pharmaceuticals, eye care (Alcon), and generics (Sandoz). The company sold its blood transfusion diagnostics unit to Grifols earlier this year, and its animal health division to Eli Lilly this Spring, a deal worth over $5 billion.
However, advancing this goal most dramatically was Novartis’ April deal with GSK, which established a new model for pharma financial ventures. Instead of an outright buy, Novartis swapped its non-flu vaccines for GSK’s oncology business, and created a new joint consumer healthcare company 63.5% owned by GSK. Novartis also acquired GSK’s AKT inhibitor cell-signalling technology, which could help it develop new therapies of its own.
Last year, the company’s operating income margin stood at nearly 25%, based on a media report. CEO Joe Jimenez says the GSK deal will position the company “incredibly well for the next 10 years.”
The company has been cutting costs for several years, and has reduced capacity by 20% over the past four years. Last year, such efforts reportedly saved Novartis nearly $3 billion.
Novartis plans to reduce headcount in its pharmaceuticals division by laying off or transferring 6% of its pharma division’s employees. Plans call for establishing a new back office services center based in India that would serve all three divisions and reduce operating costs. The company will shut down its plant in Suffern, NY, a model for lean manufacturing, after patents for its blockbuster hypertension treatment, Diovan, expired, and is also closing an Alcon facility in Ontario.
For now, Novartis is holding on to its $16-billion stake in Roche. However, Italian authorities recently launched a probe into both companies alleging that they used illegal means to give Lucentis, the ophthalmic drug that the two companies developed, and that Novartis sells outside of the U.S., an unfair market advantage.
Novartis has also been hit with allegations of fraud in the U.S., and a government lawsuit states that, from 2005 to 2013, Novartis persuaded 20 pharmacies to switch thousands of kidney transplant patients to its immunosuppressant drug Myfortic by providing kickbacks in the form of discounts and rebates.
Perhaps the most serious allegations of fraud have occurred in Japan, where the company has been accused of exaggerating the benefits of Diovan in past academic journal articles, and falsifying clinical data. A former director of the unit’s scientific affairs department was recently arrested and accused of manipulating clinical study data. Novartis is said to be actively investigating these claims.
After criticism of its plans to give its former CEO a $78-million noncompete package, news of which helped lead to stringent regulations in Switzerland, the company has increased transparency on issues of executive pay and overall governance, which are spelled out at length in its annual report.
The company continues to invest in emerging markets, and to participate in efforts to improve access to its medicines around the world. Last year, it launched $2.1 billion in programs to improve access to healthcare. Novartis is also actively investing in biologics, which account for one quarter of its current pipeline. Last year, the company broke ground on a $500-million biologics facility in Singapore, colocated with Novartis’ pharmaceutical production site in Tuas.
Novartis is also partnering and investing in new approaches to drug development. An example is its alliance with Cellectis, a French company that has developed a way to engineer cells using the CAR-T approach. In CAR-T, T cells are taken from the blood and engineered to identify cancer cell proteins, then put back in the body to seek and destroy tumors. Pfizer has just entered into a similar agreement, fueling speculation of increased competition between the two companies in R&D.
The FDA recently approved Novartis’ flu vaccine plant in Holly Springs, NC, which uses cell-culture to make the vaccines. The company can now begin commercial production for Flucelvax, its seasonal flu vaccine, to be made in the U.S. for the first time. The vaccine, approved in November 2012, was the first cell-based flu vaccine approved by FDA.
twitter.com/novartis
www.novartis.com
Headcount: | 135,696 | |
Year Established: | 1996 | |
Pharma Revenues: | $32,214 | flat |
Total Revenues: | $57,920 | +2% |
Net Income: | $9,292 | -3% |
R&D Budget: | $9,642 | +6% |
TOP SELLING DRUGS
Drug | Indication | 2013 sales | (+/- %) |
Gleevec | chronic myeloid leukemia | $4,693 | 0 |
Diovan | hypertension | $3,524 | -20% |
Lucentis | age-related macular degeneration | $2,383 | -1% |
Gilenya | multiple sclerosis | $1,934 | 62% |
Sandostatin | acromegaly | $1,589 | 5 |
Exforge | hypertension | $1,456 | 8% |
Afinitor | oncology | $1,309 | 64% |
Tasigna | chronic myeloid leukemia | $1,266 | 27% |
Galvus | diabetes | $1,200 | 32% |
Exelon | Alzheimer’s disease | $1,032 | -2% |
Exjade | iron chelation | $893 | 3% |
Sandimmun | immunosuppressive Neoral (cyclosporin) | $750 | -9% |
Voltaren | inflammation | $675 | -11% |
Myfortic | transplants | $637 | 10% |
Xolair | asthma | $613 | 22% |
Zometa | bone metastasis | $600 | -53% |
Ritalin LA | ADHD | $594 | 7% |
Comtan | Parkinson’s disease (entacapone) | $401 | -24% |
TOBI | antibiotic (tobramycin) | $387 | 22% |
Femara | breast cancer (letrozole) | $384 | -12% |
In 2012, Novartis’ senior managemers told the press that the company could have as many as 14 blockbuster drugs on the market through 2017. Novartis had over 200 products in clinical development last year, 144 of them developed by its pharmaceuticals division.
Sandoz, the company’s generic drugs division, has launched new biosimilar development programs, and is now in Phase III clinical trials for etanerecept (Enbrel) and adalimumab (Humira).
Last year, three of Novartis’ pharmaceutical division’s drug candidates received Breakthrough Therapy designations from the FDA, warranting expedited review: LDK378, for lung cancer, BYM338 for myositis, and RLX030 (serelaxin) for acute heart failure. Heart failure, Novartis noted, is an area where few successful drugs have been introduced, and this was to be “the first acute heart failure treatment breakthrough in more than 20 years.”
However, just as the FDA giveth, it can also take away. This Spring, FDA reviewers rejected serelaxin, saying more evidence of efficacy was required for approval.
Novartis has coped with market challenges by minimizing costs and increasing its focus on its three key business areas: pharmaceuticals, eye care (Alcon), and generics (Sandoz). The company sold its blood transfusion diagnostics unit to Grifols earlier this year, and its animal health division to Eli Lilly this Spring, a deal worth over $5 billion.
However, advancing this goal most dramatically was Novartis’ April deal with GSK, which established a new model for pharma financial ventures. Instead of an outright buy, Novartis swapped its non-flu vaccines for GSK’s oncology business, and created a new joint consumer healthcare company 63.5% owned by GSK. Novartis also acquired GSK’s AKT inhibitor cell-signalling technology, which could help it develop new therapies of its own.
Last year, the company’s operating income margin stood at nearly 25%, based on a media report. CEO Joe Jimenez says the GSK deal will position the company “incredibly well for the next 10 years.”
The company has been cutting costs for several years, and has reduced capacity by 20% over the past four years. Last year, such efforts reportedly saved Novartis nearly $3 billion.
Novartis plans to reduce headcount in its pharmaceuticals division by laying off or transferring 6% of its pharma division’s employees. Plans call for establishing a new back office services center based in India that would serve all three divisions and reduce operating costs. The company will shut down its plant in Suffern, NY, a model for lean manufacturing, after patents for its blockbuster hypertension treatment, Diovan, expired, and is also closing an Alcon facility in Ontario.
For now, Novartis is holding on to its $16-billion stake in Roche. However, Italian authorities recently launched a probe into both companies alleging that they used illegal means to give Lucentis, the ophthalmic drug that the two companies developed, and that Novartis sells outside of the U.S., an unfair market advantage.
Novartis has also been hit with allegations of fraud in the U.S., and a government lawsuit states that, from 2005 to 2013, Novartis persuaded 20 pharmacies to switch thousands of kidney transplant patients to its immunosuppressant drug Myfortic by providing kickbacks in the form of discounts and rebates.
Perhaps the most serious allegations of fraud have occurred in Japan, where the company has been accused of exaggerating the benefits of Diovan in past academic journal articles, and falsifying clinical data. A former director of the unit’s scientific affairs department was recently arrested and accused of manipulating clinical study data. Novartis is said to be actively investigating these claims.
After criticism of its plans to give its former CEO a $78-million noncompete package, news of which helped lead to stringent regulations in Switzerland, the company has increased transparency on issues of executive pay and overall governance, which are spelled out at length in its annual report.
The company continues to invest in emerging markets, and to participate in efforts to improve access to its medicines around the world. Last year, it launched $2.1 billion in programs to improve access to healthcare. Novartis is also actively investing in biologics, which account for one quarter of its current pipeline. Last year, the company broke ground on a $500-million biologics facility in Singapore, colocated with Novartis’ pharmaceutical production site in Tuas.
Novartis is also partnering and investing in new approaches to drug development. An example is its alliance with Cellectis, a French company that has developed a way to engineer cells using the CAR-T approach. In CAR-T, T cells are taken from the blood and engineered to identify cancer cell proteins, then put back in the body to seek and destroy tumors. Pfizer has just entered into a similar agreement, fueling speculation of increased competition between the two companies in R&D.
The FDA recently approved Novartis’ flu vaccine plant in Holly Springs, NC, which uses cell-culture to make the vaccines. The company can now begin commercial production for Flucelvax, its seasonal flu vaccine, to be made in the U.S. for the first time. The vaccine, approved in November 2012, was the first cell-based flu vaccine approved by FDA.