Basel: Novartis on Wednesday predicted that core operating income would grow in a “mid-single digit” percentage range in 2023 following stagnation last year, as the Swiss drugmaker prepares to spin off its Sandoz generics business.
Full-year core operating income was broadly flat at $16.7 billion, it said in a statement, coming in slightly below market expectations of $16.8 billion.
Adjusted for overall negative currency effects, group sales in 2022 advanced 4 per cent to $50.5 billion as gains from heart failure drug Entresto and multiple sclerosis (MS) drug Kesimpta were partly offset by competition from cheap generic copies of established MS drug Gilenya.
Novartis said in its statement it’s on track to spin off its generics unit Sandoz in the second half of the year as part of its effort to sharpen its focus on its patented prescription medicines.
Analysts say the share price has been supported by a programme unveiled in 2022 to trim costs and cut 8,000 jobs and plans announced later last year to focus on fewer therapy areas and drug technologies.
But the market has been underwhelmed by its prospects for medium-term growth from new drugs. Shares are down about 11% since January 2020, underperforming most of its rivals.
The market has been pinning hopes for future sales growth on wider use of breast cancer drug Kisqali and iptacopan, which is being tested against a rare genetic blood disorder, possibly challenging AstraZeneca’s drugs Soliris and Ultomiris.
MS drug Kesimpta, requiring fewer injections than standard therapies, is expected to become Novartis’ second largest growth driver in 2023, after Entresto.