Novartis sales flag, but CEO promises cost cuts will fuel profits

"Take a look at Novartis' ($NVS) second-quarter results for reasons why it engineered that big asset swap-and-sale with GlaxoSmithKline ($GSK) and Eli Lilly ($LLY). The two units Novartis is unloading, vaccines and animal health, delivered weak sales for the quarter, dragging the company's top line below expectations.

The Swiss drugmaker's pharma group didn't exactly shine either, though. Branded drug sales barely ticked upward, . . . . "

"It was Sandoz, the generics division, that delivered the biggest boost, growth-wise, with a 5% year-over-year increase. Overall, Q2 revenue grew by 2% to $14.64 billion, a tad lower than the average analyst forecast, the Financial Times notes."

"Don't expect much better for the rest of the year, either; the company confirmed its forecast of low- to mid-single digit sales growth, . .. That's because Novartis is finally facing full-on generic competition . . . "

"Those savings won't come overnight, though, Jimenez warns." . . . . "This is going to be a process over time that allows us to continually lower our costs and continually drive margin growth."

http://www.fiercepharma.com/story/novartis-sales-flag-diovan-generics-ceo-promises-cost-cuts-will-fuel-profit/2014-07-17

 

"His mouth writes the check and your assess pay the bill".

 

All part of the plan