Swiss pharmaceuticals giant Novartis on Wednesday reported a drop in net profit in 2019 — a year marked by large-scale restructuring — but saw a strong fourth quarter and predicted significant sales growth in 2020.
A day earlier, Pfizer reported a fourth-quarter loss on lower sales but said the company was on track to reengineer itself to focus on new game-changing pharmaceuticals.
Novartis said net profit of $11.7 billion (£8.9 billion) last year was down seven percent from 2018, including the impact of the spin-off of its Alcon eye care division.
Sales came in at $47.4 billion, up six percent.
The company reported sales in its final quarter up nine percent in constant currencies, boosted by a range of new medicines, including one of the world’s most expensive drugs.
“Novartis delivered an exceptional 2019,” company chief Vas Narasimhan said in a statement.
Pfizer reported a loss of $337 million for quarter ending December 31, compared with a loss of $394 million in the year-ago period.
Revenues fell 9.2 percent to $12.7 billion.
Pfizer reported growth in several key drugs, including Eliquis, which prevents blood clots, and Xeljanz, which is used to treat rheumatoid arthritis and has been launched in some places to address ulcerative colitis.
However, Pfizer said the drop in sales reflected an operational decline of $1.1 billion as other products faced competition from generics after losing patent protection.
Having grown through acquisition, Pfizer is restructuring itself and last year combined its consumer healthcare business with that of GlaxoSmithKline in a new venture in which Pfizer has a 32 percent stake.
The company is also uniting its generic business Upjohn with Mylan. Pfizer will own 57 percent of the new company following the completion of the deal, expected by mid-year, said Pfizer Chief Executive Albert Bourla.
Bourla pointed to upcoming releases of clinical testing on drugs and vaccines under development to treat various cancers as well as skin ailments and arthritis.
Pfizer is on track to be “a smaller, science-based company with a singular focus on innovation while also continuing to allocate significant capital directly to shareholders, primarily through dividends,” Bourla said.
For Novartis also, the year was heavily coloured by a vast restructuring, including the spin-off of Alcon, which is now trading separately, plus its decision to pursue the acquisition of US firm Medicines Company for a whopping $9.7 billion in a bid to boost its cardiovascular treatment portfolio.
The move, which is expected to be finalised during the first quarter this year, will mark the latest in a line of acquisitions aimed at enhancing the Swiss company’s stable of cutting-edge drugs to treat diseases such as cancer.
In snapping up Medicines Co., the pharma giant said it will obtain access to a promising cholesterol drug called Inclisiran, described by Narasimhan as a “potentially transformational medicine”.
The year was also marked by Novartis’s launch of five new treatments, including Zolgensma, a one-time gene treatment for spinal muscular atrophy, also known as SMA, which at the cost of $2.0 million a dose is considered the world’s most expensive drug.
During its first year, this drug brought in $361 million, Novartis said.
Looking ahead, the company said it expected to see sales growth of between five and nine percent in 2020, which was above expectations.
This year, “we expect to sustain our long-term growth and margin expansion driven by our in market growth drivers and the 15 ongoing or upcoming major launches, while advancing our rich pipeline,” Narasimhan said.
