Novartis highlights strong innovation momentum at its second Meet Novartis Management investor day
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Novartis International AG /
Novartis highlights strong innovation momentum at its second Meet Novartis
Management investor day
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* Strong progress on innovation across divisions
* Pharmaceuticals is building breadth and depth in seven franchises,
including Oncology, where it is complementing leadership in targeted
therapies and CART with immuno-oncology assets
* Alcon is focused on eye care innovation, including strengthening its IOL
pipeline over prior year and focusing on early-stage discovery in
Ophthalmic Pharmaceuticals
* Sandoz is extending its lead in differentiated generics, exemplified by
first-of-a-kind FDA approvals for biosimilar Zarxio and generic
Copaxone(®) 20mg
* Clear focus on execution
* Expect to increase core margin (cc) in 2015 due to portfolio
transformation and productivity improvements in line with 2015 full year
guidance
* Novartis Business Services fully operational and contributing to margin
improvement; target to keep cost under management flat versus prior-year
* Execution of portfolio changes on track; additional Oncology sales force
in top 20 markets fully operational
* Clear priorities for capital allocation, allowing for strong and growing
dividend and strategic bolt-on acquisitions
Basel, June 18, 2015 - For its second "Meet Novartis Management" investor day,
Novartis gathered more than 20 of its top executives from Pharmaceuticals,
Alcon, Sandoz and NIBR, to meet with approximately 100 investors and analysts at
the Novartis Institutes for BioMedical Research in Boston.
"With the portfolio transformation behind us[1], management is focused on
execution against our strategic priorities, including strengthening innovation
across our three businesses. In Pharmaceuticals, we have a deep portfolio with
Entresto (LCZ696) for chronic heart failure, Cosentyx for psoriasis, our newly
acquired Oncology assets, and a strategy to lead in second generation immuno-
oncology. At Alcon, IOL innovation is accelerating, and at Sandoz, we have a
strong biosimilar and generic pipeline. With strong innovation in each of our
businesses, we are well positioned for the future," said Novartis CEO Joseph
Jimenez.
Pharmaceuticals
Pharmaceuticals has an industry-leading pipeline with 143 active programs,
including 74 new molecular entities, more than 500 trials ongoing and more than
300 trials planned to start through the end of 2016. These programs span disease
areas where the unmet need is still great and where we can offer a real advance
in treatment for patients, including oncology, cardio-metabolic, immunology and
dermatology, and respiratory.
In Oncology, where Novartis is the number two player globally, we are taking a
holistic approach, continuing to build our strength in targeted therapies and
leadership position in CART, while aggressively pursuing a full suite of immuno-
oncology (IO) assets. The aim is to lead in each of these areas, positioning us
well for combination therapies.
We strengthened our position in targeted therapies with the recently acquired
Oncology assets, including Votrient, Tafinlar, Mekinist and Promacta, which
generated 2014 net sales of USD 2.0 billion. We see the potential to increase
sales to reach three blockbusters through market expansion and new indications.
Data from the COMBI-d trial of Tafinlar and Mekinist, for example, showed a 29%
reduction in risk of death versus Tafinlar monotherapy and 51% overall survival
at two years. The combination was granted accelerated approval in the US in
January 2014, and submissions were completed in the EU and Japan for first line
melanoma in the second quarter of 2015. The combination of Tafinlar and Mekinist
is also being investigated in non-small cell lung cancer and colorectal cancer.
In immuno-oncology, we made significant advances with the acquisition of the
CoStim portfolio and alliance with Aduro Biotech, and are now bringing our own
assets - including both monotherapies and combinations - to the clinic. Our
anti-PD1 checkpoint inhibitor (PDR001) started first-in-human trials in April
2015. Our anti-LAG3 (LAG525), anti-TIM3 (MBG453) and anti-CSF1 (MCS110)
therapies are on track to be in clinical trials in 2015, and doublets of those
monotherapies with PDR001 are planned to enter in 2015 and 2016. Our STING
agonist MIW815 (through collaboration with Aduro Biotech) and our GITR agonist
are progressing towards first-in-human in 2016.
We are continuing to explore the potential of targeted therapy-IO combinations
through several external collaborations, including one with
MedImmune/AstraZeneca on the triple combination of Tafinlar, Mekinist and an
anti-PDL1 in melanoma. We also have three combinations with Opdivo(®) (Bristol-
Myers Squibb) entering the clinic in the first half of 2015.
In Cardio-Metabolic, we are preparing for the expected launch of LCZ696 in heart
failure with reduced ejection fraction, with accelerated reviews underway in the
US, Canada and Switzerland, conditional approval for the brand name in the US
(Entresto), and early/temporary access programs granted in the UK and France.
The franchise has a strong pipeline with pivotal Phase III studies for LCZ696 in
heart failure with preserved ejection fraction, RLX030 in acute heart failure
and ACZ885 in coronary artery disease.
In Immunology and Dermatology, Pharmaceuticals is working to expand the
indications for Cosentyx beyond psoriasis, with pivotal Phase III studies in
psoriatic arthritis (FUTURE 1 and 2) and ankylosing spondylitis (MEASURE 1 and
2) forming the basis for regulatory filings, including in the US and EU, which
were completed for both indications in the second quarter of 2015. We expect
CHMP opinion in the first half of 2016 and potential FDA approval in the second
half of 2016 for these indications. Cosentyx is expected to be a blockbuster and
one could build a scenario where it could reach USD 4-5 billion in psoriasis and
the arthridities. This assumes success in the new already submitted indications.
In Respiratory, Pharmaceuticals is committed to expanding its asthma portfolio
beyond Xolair. A pivotal trial of QVM149 studying the combination of LABA, LAMA
and an inhaled corticosteroid is planned to start in 2015. In addition, a
pivotal study is planned for QAW039, a potential first-in-class oral anti-
inflammatory for asthma.
Alcon
Innovation is accelerating at Alcon. The division is rolling out Centurion, the
industry's most advanced phacoemulsification platform, and has reached 15%
penetration of the global installed base and over 25% in the US. Alcon is seeing
improved pull-through on sales of consumables from its Cataract Refractive
Suite. At the same time, the division has increased the number of intraocular
lens (IOL) projects in its pipeline over the past year, with key pre-loaded and
trifocal IOL launches on track for launch in Europe in the second half of 2015,
and work underway on a next-generation, potentially best-in-class IOL platform.
In addition, Alcon is developing its early stage Ophthalmic Pharmaceuticals
pipeline, exploring novel glaucoma treatment pathways and early-stage
opportunities in dry eye. Alcon is also expecting to innovate in the retina
market with RTH258, which has demonstrated promising visual acuity gains in
patients with wet age-related macular degeneration (wet AMD). Alcon initiated a
Phase III study of RTH258 in wet AMD in December 2014.
Sandoz
Sandoz is focused on extending its lead in differentiated generics, and driving
growth with margin expansion to support continued investment in innovation. It
is already the global leader in biosimilars[2], with three in-market products
(Omnitrope, Binocrit and Zarzio) that are number one in their respective
segments, as well as a strong pipeline with five molecules in Phase III
development/registration and plans to announce ten further biosimilar filings
over the next three years. In the US, where the biosimilars market is still
evolving, Sandoz was the first company to receive approval for a biosimilar
under the new pathway (Zarxio), and will leverage its experience from ex-US
markets.
In addition to biosimilars, Sandoz has a broad range of innovative development
capabilities, including generic injectables, dermatology medicines, ophthalmics
and inhalables, as well as anti-infectives. Sandoz's Glatopa, the prime example
of a differentiated generic, was the first FDA approved substitutable generic
version of Copaxone(®) 20mg. Sandoz has accelerated growth in the US behind a
focus on differentiated generics, including the Fougera specialty dermatology
business.
To drive growth with margin expansion, Sandoz is refocusing its business on key
geographies and portfolio areas, and streamlining its manufacturing footprint to
ensure a fully competitive global production network. By driving margin
expansion in the retail business, Sandoz expects to be strongly positioned to
continue investing in growth opportunities.
NIBR
NIBR helps build our pipeline across divisions, making Novartis the company with
the largest number of active clinical trials in the industry. Supporting our
Oncology strategy, for example, NIBR has a broad pipeline with drug candidates
covering most oncogenic pathways. Together with our IO portfolio, this provides
a strong platform for novel combinations.
NIBR is also focused on a next wave of therapeutics, based on principles of
regenerative biology, that address common disorders of aging, including muscle
weakness, loss of vision and hearing, and heart and liver failure, including
nonalcoholic steatohepatitis (NASH). New NIBR-derived drugs and drug candidates
also address a range of auto-immune and other disorders.
In addition to driving innovation in-house, NIBR manages a robust network of
alliances, including more than 300 collaborations with academic institutions and
more than 100 collaborations with biotech and pharmaceutical organizations (270
including those managed by the Pharmaceuticals Division). Jointly NIBR and
Pharmaceuticals added 37 new alliances in 2014.
Novartis Group
As a Group, Novartis is focused on execution to deliver strong innovation and
financial results. The portfolio transformation is largely completed, with the
last step - the divestiture of the influenza vaccines business to CSL - expected
to close in the second half of 2015. The integration of the new Oncology assets
is also progressing well, with approximately 1,800 new associates joined in 60
countries, and the additional sales force in our top 20 markets already fully
operational.
We expect to grow core margin in constant currencies (cc) in line with our full
year 2015 guidance, driven by the portfolio transformation, ongoing productivity
programs (including effective resource allocation) and Novartis Business
Services (NBS).[3]
NBS, which covers approximately USD 5 billion in spend, is fully operational and
contributing to margin improvement. We have already transferred approximately
8,700 associates from divisions to NBS, generated procurement savings of
approximately USD 350 million in the first quarter of 2015, and selected five
locations for Global Service Centers. Our target is to keep the cost under NBS
management flat versus prior year, even as revenue grows, by capturing synergies
across divisions.
While we continue to improve productivity and generate leverage, our capital
allocation priorities remain the same: investing in the existing business,
growing the annual dividend, bolt-on acquisitions, and share buybacks.
In each of our businesses, we have leading positions and growth catalysts
expected in the near, medium and long-term. Underpinning those businesses, we
have a world-class research engine in NIBR, an operational platform to extract
synergies in NBS, and the financial and cost discipline to drive leverage. Taken
together, Novartis is set for the future, with a strategy to realize the full
potential of the portfolio of our leading businesses.
For background slides please refer to the following link:
http://www.novartis.com/investors/event-calendar/index.shtml
Disclaimer
This press release contains forward-looking statements that can be identified by
words such as "momentum," "progress," "building," "focused," "pipeline,"
"focusing," "focus," "expect," "target," "on track," "strategy," "accelerating,"
"well positioned," "ongoing," "planned," "aim," "being investigated,"
"continuing," "potential," "preparing," "launch," "underway," "working,"
"committed," "potentially," "developing," "initiated," "continued,"
"development," "plans," "evolving," "will," "expects," "continue," "expected,"
"progressing," "priorities," or similar terms, or by express or implied
discussions regarding potential new products, potential new indications for
existing products, or regarding potential future revenues from any such
products; potential shareholder returns or credit ratings; or regarding the
potential completion of the announced transaction with CSL, or regarding the
potential financial or other impact on Novartis of the transactions with GSK,
Lilly or CSL, or regarding any potential strategic benefits, synergies or
opportunities as a result of these transactions; or regarding potential future
sales or earnings of the Novartis Group or its divisions and associated
companies; or by discussions of strategy, plans, expectations or intentions. You
should not place undue reliance on these statements. Such forward-looking
statements are based on the current beliefs and expectations of management
regarding future events, and are subject to significant known and unknown risks
and uncertainties. Should one or more of these risks or uncertainties
materialize, or should underlying assumptions prove incorrect, actual results
may vary materially from those set forth in the forward-looking statements.
There can be no guarantee that any new products will be approved for sale in any
market, or that any new indications will be approved for any existing products
in any market, or that any approvals which are obtained will be obtained at any
particular time, or that any such products will achieve any particular revenue
levels. Nor can there be any guarantee that the announced transaction with CSL
will be completed in the expected form or within the expected time frame or at
all. Neither can there be any guarantee that Novartis will be able to realize
any of the potential strategic benefits, synergies or opportunities as a result
of the transactions with GSK, Lilly or CSL. Neither can there be any guarantee
that the Novartis Group or any of its divisions or associated companies will
achieve any particular financial results in the future. Nor can there be any
guarantee that shareholders will achieve any particular level of shareholder
returns. Neither can there be any guarantee that the Novartis Group, or any of
its divisions, will be commercially successful in the future, or achieve any
particular credit rating. In particular, management's expectations could be
affected by, among other things, unexpected regulatory actions or delays or
government regulation generally, including an unexpected failure to obtain
necessary government approvals for the announced transaction with CSL, or
unexpected delays in obtaining such approvals; the potential that the strategic
benefits, synergies or opportunities expected from the transactions with GSK,
Lilly or CSL may not be realized or may take longer to realize than expected;
the inherent uncertainties involved in predicting shareholder returns or credit
ratings; the uncertainties inherent in research and development, including
unexpected clinical trial results and additional analysis of existing clinical
data; the Company's ability to obtain or maintain proprietary intellectual
property protection; unexpected manufacturing or quality issues; global trends
toward health care cost containment, including ongoing pricing pressures;
uncertainties regarding actual or potential legal proceedings, including, among
others, actual or potential product liability litigation, litigation and
investigations regarding sales and marketing practices, government
investigations and intellectual property disputes; general economic and industry
conditions, including uncertainties regarding the effects of the persistently
weak economic and financial environment in many countries; uncertainties
regarding future global exchange rates; uncertainties regarding future demand
for our products; uncertainties involved in the development of new healthcare
products; uncertainties regarding potential significant breaches of data
security or disruptions of the Company's information technology systems; and
other risks and factors referred to in Novartis AG's current Form 20-F on file
with the US Securities and Exchange Commission. Novartis is providing the
information in this press release as of this date and does not undertake any
obligation to update any forward-looking statements as a result of new
information, future events or otherwise.
All product names appearing in italics are trademarks owned by or licensed to
Novartis Group Companies. Copaxone(®) is a registered trademark of Teva
Pharmaceutical Industries Ltd. Opdivo(®) is a registered trademark of Bristol-
Myers Squibb Company.
About Novartis
Novartis provides innovative healthcare solutions that address the evolving
needs of patients and societies. Headquartered in Basel, Switzerland, Novartis
offers a diversified portfolio to best meet these needs: innovative medicines,
eye care and cost-saving generic pharmaceuticals. Novartis is the only global
company with leading positions in these areas. In 2014, the Group achieved net
sales of USD 58.0 billion, while R&D throughout the Group amounted to
approximately USD 9.9 billion (USD 9.6 billion excluding impairment and
amortization charges). Novartis Group companies employ approximately 120,000
full-time-equivalent associates. Novartis products are available in more than
180 countries around the world. For more information, please visit
http://www.novartis.com.
###
Novartis Media Relations
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Eric Althoff Dermot Doherty
Novartis Global Media Relations Novartis Global Media Relations
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--------------------------------------------------------------------------------
[1] Divestiture of the influenza vaccines business to CSL is expected to close
in the second half of 2015
[2] By sales in the combined regions of North America, Europe, Japan and
Australia
[3] Barring unforeseen events. For continuing operations: net sales expected to
grow mid-single digit (cc); core operating income expected to grow ahead of
sales at a high-single digit rate (cc)
Media release (PDF):
http://hugin.info/134323/R/1929399/693088.pdf
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[HUG#1929399]
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Datum: 18.06.2015 - 07:00 Uhr
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