- Novartis AG grew revenues by 3% year-over-year in the third quarter, beating market expectations as sales of new drugs and better performance from eye business Alcon helped the Swiss pharma shrug off steep declines from its former top-seller Gleevec.
- Sales of Cosentyx, an IL-17 blocker approved for several autoimmune diseases, rose 83% to reach $556 million for the period. Uptake has been strong across all indications, and the biologic commands a leading share of new-to-brand prescriptions in psoriatic arthritis and ankylosing spondylitis.
- Entresto, on the other hand, continues to grow more slowly than originally expected. Third-quarter sales, at $128 million, were up more than double from the same period last year, yet still fell short of forecasts.
Novartis is counting on continued acceleration in sales of Cosentyx (secukinumab) and Entresto (sacubitril/valsartan) — among other new drugs — to help fuel top-line growth for the company through 2020. Cosentyx, already on pace for $2 billion in annualized sales, has so far delivered.
Amid overall growth, however, there were some signs of sluggishness from other key products. Sales of the heart drug Entresto weakened over the summer before regaining momentum later in the quarter, Novartis said, while the recently approved breast cancer drug Kisqali (ribociclib) has had a slow start.
Novartis has built out an expanded sales force behind Entresto, and expects improved access to help drive the product forward. Those additional resources have kept sequential sales growth in the double digits, although the quarter-on-quarter increase slowed from the second to the third quarter.
Sales will need to accelerate even further if the drug is to meet the company’s $500 million sales goal for 2017. “Once we look at the Q4 exit, we will have more clues about where growth is coming from and we will adjust in 2018,” said Paul Hudson, head of Novartis Pharmaceuticals, on a Oct. 24 call with analysts.
While new drug launches — as well the recent approval of the CAR-T therapy Kymriah (tisgaenleceucel) — hold the keys to growth from the company’s pharma business, analysts were more focused on Novartis’ other units.
Since early 2017, Novartis has been conducting a strategic review of its Alcon division, which has underperformed since its acquisition. No decision has been reached yet, but Novartis management indicated spinning the unit out into a stand-alone company via a capital markets exit has looked the most appealing. Any action likely won’t happen before the first half of 2019.
“The issue is Alcon needs to show multiple quarters of top and bottom line growth,” explained outgoing company CEO Joe Jimenez. “We want the business to come from a position of strength that will do well in the public markets.”
Novartis’ Sandoz unit, which primarily deals in generic drugs and biosimilars, was also a focal point for analysts due to a tightening market for copycat products in the U.S. While Novartis did acknowledge the pricing pressures, the company defended the division’s role as a complement to its branded business.
Shares in Novartis fell more than 2% in Tuesday morning trading following the company’s earnings announcement.
Article courtesy of BioPharmDive. For more information