Connect with us


Novartis’s regulatory delays add to pandemic sales hit

Novartis's regulatory delays add to pandemic sales hit 1

By John Miller

ZURICH (Reuters) – Switzerland’s Novartis said delays of two blockbuster hopefuls – heart drug Leqvio that cost it $10 billion and $2.1 million-per-patient Zolgensma – remain in regulators’ hands, dragging on sales already hit by the pandemic.

Novartis shares fell 3% as analysts deemed the drugmaker’s 2021 targets disappointing.

Chief Executive Vas Narasimhan, who on Tuesday reported fourth-quarter results that missed expectations, said cholesterol-reducing Leqvio’s approval timeline depends on the U.S. Food and Drug Administration, after the agency flagged a supplier’s “facility inspection-related conditions”.

Moreover, expanding Zolgensma to older patients is stalled, as the FDA seeks safety data.

Like many drugmakers, Novartis in faced challenges due to the coronavirus pandemic, as lockdowns kept patients away from hospitals. The regulatory obstacles add to his burden this year.

“Largely the timelines are out of our control,” he told reporters on a call, on the FDA’s scrutiny of Leqvio.

Narasimhan, who did not provide details on “unresolved” issues at the Italian plant of supplier Corden Pharma, said Novartis would respond to the FDA in the second or third quarter.

Leqvio is approved in Europe.

Expanding Zolgensma to older patients – the therapy is approved for babies with spinal muscular atrophy (SMA) and reaped $900 million in 2020 – is also stalled after primate studies raised safety worries and necessitated further FDA scrutiny.

The delay helps rival drugs including from Roche establish an SMA foothold.

“We continue to await our animal data in the mid part to second half of this year,” Narasimhan said, on prospects of Zolgensma trials resuming.

His regulatory updates came as Novartis’s fourth-quarter core net income rose 3% to $3.03 billion, compared to the average analyst forecast of $3.15 billion in a Refinitiv poll.

Sales rose 1% to $12.77 billion, missing the $12.88 billion poll forecast, as COVID-19 lockdowns hurt drug sales.

“We expect…to continue to see pandemic affects on the health care system through the first half,” Narasimhan said.

Novartis proposed raising its dividend 1.7% to 3 Swiss francs, and forecast 2021 net sales growing at a low- to mid-single-digit percentage rate.

“The 2021 outlook is below our expectations,” Zuercher Kantonalbank analysts told investors.

Novartis doesn’t have vaccines in the works for COVID-19, and several of its medicines failed efforts to repurpose them for pandemic use, but it is still holding out hope for a partnership with Swiss biotech Molecular Partners to yield a new treatment for the coronavirus.

(Reporting by John Miller; Editing by Michael Shields and Louise Heavens)

Editorial & Advertiser disclosure
Our website provides you with information, news, press releases, Opinion and advertorials on various financial products and services. This is not to be considered as financial advice and should be considered only for information purposes. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third party websites, affiliate sales networks, and may link to our advertising partners websites. Though we are tied up with various advertising and affiliate networks, this does not affect our analysis or opinion. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you, or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish sponsored articles or links, you may consider all articles or links hosted on our site as a partner endorsed link.
Global Banking and Finance Review Awards Nominations 2021
2021 Awards now open. Click Here to Nominate


Newsletters with Secrets & Analysis. Subscribe Now