Novartis lifted full-year sales and profit targets on Thursday, helped by innovative medicine sales and as the Swiss drugmaker’s Sandoz generics unit saw rising international demand for its biosimilar copies of blockbuster drugs made by rivals.
Second-quarter core operating income rose 20% in constant currencies to $3.6 billion, while sales were up 8% to $11.8 billion, compared to the $11.54 billion forecast by 10 analysts in a Refinitiv poll.
“We are really excited about the results we’re seeing in (the second quarter). We’ve seen strong sales momentum across all our growth-drivers,” Vasant Narasimhan, CEO of Novartis told CNBC.
The Basel-based company now expects 2019 core operating income to grow at low-double-digit to mid-teens percentages, faster than the previous high-single-digit percentage rate target. Sales expectations were also raised, with growth now seen in the mid to high-single digit range.
Novartis highlighted performance at Sandoz, where it said international business offset price declines in the United States.
It revised Sandoz 2019 sales forecasts upwards -- to broadly in line with last year or possible low-single-digit growth -- as the company’s copies of Roche’s Mabthera, AbbVie’s Humira and Amgen’s and Pfizer’s Enbrel captured business from the namebrand drugs in Europe.
“We increased our full year guidance for both sales and core operating income in light of our strong momentum,” Narasimhan said in a statement.
U.S. Health Reform
Amid the ongoing discussions in the United States over changes to the health system, Narasimhan told CNBC there is still a lot of uncertainty as to what might happen to the sector.
“It is a very fluid environment right now - both in terms of the executive branch and potential actions from the executive branch could take and the legislative branch,” he said.
“We believe, it is important first and foremost, (that) we need to tackle patients out of pocket costs at the pharmacy counter,” Narasimhan also told CNBC.