New drug sales help boost Novartis Q1 profit (Update)

by John Heilprin
The Aug. 12, 2005 file photo shows the logo of Swiss company Novartis in Basel, Switzerland. Swiss pharmaceutical giant Novartis AG announced a series of multibillion-dollar deals Tuesday, April 22, 2014 with other major pharmaceutical companies that it said would reduce sales but boost profitability, while affecting some 15,000 of its employees globally. (AP Photo/Keystone, Steffen Schmidt)

Strong new drug sales and higher operating income helped Swiss pharmaceutical firm Novartis AG report a 24 percent rise in first-quarter profit.

The company said Thursday that its net profit of nearly $2.97 billion, up from $2.42 billion in the same period last year, was helped by sales growth from some of its newest product launches, such as Gilenya for multiple sclerosis and Afinitor for cancer, and higher operating income.

The company based in Basel, Switzerland, has been counting on these new drugs to offset patent expirations, such as its blockbuster heart drug Diovan which lost U.S. protection in 2012.

Also helping was a $900 million pretax gain from selling part of its diagnostics business to the Spanish health care company Grifols SA for $1.68 billion in November.

The company noted that the strong new drug sales were reinforced by asthma treatment Xolair gaining approval in the European Union and United States and meningitis B vaccine Bexsero being recommended in the U.K. and gaining new designation in the U.S. Growth in emerging markets, particularly China, also helped.

"Novartis delivered a solid quarter, with all divisions contributing to growth," CEO Joseph Jimenez said.

The Jan. 29, 2014 file photo shows Novartis CEO Joseph Jimenez as he arrives for the annual balance press conference in Basel, Switzerland. Swiss pharmaceutical giant Novartis AG announced a series of multibillion-dollar deals Tuesday, April 22, 2014 with other major pharmaceutical companies that it said would reduce sales but boost profitability, while affecting some 15,000 of its employees globally. (AP Photo/Keystone, Steffen Schmidt)

But the company's overall sales rose only 1 percent, to $14.02 billion, in large part due to pressure that some of its drugs, such as Afinitor for cancer and Glivec for leukemia, face from competition by generic suppliers.

Jimenez emphasized that the major overhaul of its business that Novartis launched Tuesday—a series of "transformational" multibillion-dollar deals with Britain's GlaxoSmithKline PLC and Eli Lilly & Co. of the United States—would "position the company for future success based on our sharpened focus, innovation power and financial strength."

Novartis shares dropped 1.9 percent to close at 74.80 Swiss francs Thursday, after rising by 3 percent in the wake of Tuesday's announcement.

1 /5 (1 vote)
add to favorites email to friend print save as pdf

Related Stories

Novartis Q4 net profit rises to $2.0 billion

Jan 29, 2014

Swiss drug maker Novartis AG reported a 2 percent rise in fourth-quarter net profit Wednesday, helped by delays in generic competition to its blockbuster drugs.

Eli Lilly to buy part of Novartis for $5.4 bn

Apr 22, 2014

US pharmaceutical giant Eli Lilly said Tuesday it has reached an agreement to acquire the animal health division of Novartis of Switzerland for $5.4 billion (3.9 billion euros).

Recommended for you

Humiliation tops list of mistreatment toward med students

11 hours ago

Each year thousands of students enroll in medical schools across the country. But just how many feel they've been disrespected, publicly humiliated, ridiculed or even harassed by their superiors at some point during their ...

Surrogate offers clues into man with 16 babies

20 hours ago

When the young Thai woman saw an online ad seeking surrogate mothers, it seemed like a life-altering deal: $10,000 to help a foreign couple that wanted a child but couldn't conceive.

Nurses go on strike in Ebola-hit Liberia

20 hours ago

Nurses at Liberia's largest hospital went on strike on Monday, demanding better pay and equipment to protect them against a deadly Ebola epidemic which has killed hundreds in the west African nation.

ALS Ice Bucket Challenge arrives in North Korea

Aug 31, 2014

It's pretty hard to find a novel way to do the ALS Ice Bucket Challenge by now, but two-time Grammy-winning rapper Pras Michel, a founding member of the Fugees, has done it—getting his dousing in the center ...

Cold cash just keeps washing in from ALS challenge

Aug 28, 2014

In the couple of hours it took an official from the ALS Association to return a reporter's call for comment, the group's ubiquitous "ice bucket challenge" had brought in a few million more dollars.

User comments