Novartis, the Swiss pharmaceutical company, closed the second quarter of 2024 with growing financial results. The net sales reached $12,5 billion, up 9% from the previous year, or 11% at constant exchange rates (cc). A result that was fueled by a contribution in terms of volume of 15 percentage points to growth. However, generic competition and pricing pressure had a negative impact of 2 percentage points each. L'Net income for the quarter was $3,2 billion, marking an increase of 43% (49% cc), driven primarily by a greater operating profit.
Expectations for the year are rising
Building on strong first-half momentum, Novartis has revised the forecasts upwards for the entire year 2024 regarding thecore operating profit. Net sales are expected to grow between 9% and 11%, while core operating profit is expected to grow between 13% and 19%, compared to the previous forecast of growth between 10% and 15%.
The CEO You go narasimhan commented: “Novartis delivered a strong second quarter, with net sales up 11% and a core operating income margin close to 40%. Our performance reflects continued strong momentum in our key growth drivers, both in the United States and beyond, allowing us to update our guidance for fiscal 2024.”
Pipeline and innovations
Novartis has made significant progress progress in its pipeline during the second quarter of 2024. The company has completed FDA (U.S. Food and Drug Administration) applications for Scemblix in first-line Chronic Myeloid Leukemia (CML) and for atrasentan in Immunoglobulin A Nephropathy (IgAN). Additionally, updated data was generated in the NATALEE study to support Kisqali's strong profile in early breast cancer (eBC). Novartis also has cincluding multiple agreements to expand its pipeline into radioligand therapy (RLT) and prostate cancer treatment.
Sales and performance of key products
Le Pluvicto sales, a treatment for prostate cancer, did not fully meet analysts' expectations. However, other drugs like Cosentyx, for psoriasis, and other immunological treatments have exceeded market expectations. The financial director Harry Kirsch stressed that despite political tensions, growth in key markets such as China and the United States has been excellent.
Kirsch also added that Pluvicto's growth could receive a significant boost in future sales from a possible approval of the drug for a new group of patients.
Novartis' focus
In 2023, Novartis completed its transformation into a specialty company exclusively in innovative medicines. The company's strategy is clear and focused on four main therapeutic areas: cardiovascular-renal-metabolic, immunology, neuroscience and oncology. In these areas, Novartis has numerous commercial and development assets targeting diseases with high morbidity burden and substantial growth potential.
In addition to established technology platforms (chemical and biopharmaceuticals), Novartis is prioritizing three emerging platforms: gene and cell therapy, radioligand therapy and xRNA. These areas are at the center of new investments in research and development (R&D) capacity and production scale.
Geographically, Novartis is focused on growth in four priority markets: United States, China, Germany and Japan.
Novartis has placed a renewed focus on accelerating growth, focusing efforts on the delivery of high-value medicines (NMEs) and product launch excellence, with a rich pipeline in its core therapeutic areas. In delivering shareholder returns, the company continues to integrate operational excellence to improve financial results. Novartis maintains firm discipline and a shareholder-centric orientation in capital allocation, benefiting from significant cash generation and a robust capital structure that supports ongoing flexibility.
Furthermore, Novartis is committed to strengthening the company's foundation, leveraging the potential of its people, expanding data science and technology, and pursuing building trust with society.
