Sandoz gains on strong biosimilar growth, touts 'golden decade'
By Marleen Kaesebier
Sandoz Reports Strong Financial Results and Strategic Focus
ZURICH, Aug 5 (Reuters) - Swiss generic drug maker Sandoz reported a 9% jump in second-quarter net sales on Wednesday, driven by strong growth in biosimilars as patents expire for popular medicines, boosting the shares.
Net sales amounted to $3.01 billion, compared with the $2.99 billion analysts expected in a Vara-compiled consensus, lifting the shares around 7% in early trade.
Biosimilars Drive Growth
Sandoz is increasingly focusing on biosimilars, versions of biological medicines for which patents and market exclusivity have expired. They are typically much cheaper than the original drugs because they require less costly research and development.
Sales Performance and Market Share
Biosimilar net sales rose 22% at constant currencies after an 18% jump in the first quarter, a trend Sandoz said at the time should continue throughout the year. The drugs accounted for 33% of total net sales with generics making up the rest.
Patent Expiries and Strategic Positioning
Sandoz is among the biggest beneficiaries of a wave of patent expiries that innovator drugmakers like former parent Novartis view as the biggest patent cliffs in decades. Sandoz's management has deemed the expiries a "golden decade" for the company.
Executive Perspective
"You're sitting here with $650 billion of product due to come off patent in the next 10 years. That's more than the entire history of this industry," Chief Executive Richard Saynor said in an interview. "I think we're extremely well positioned."
Regional Growth Highlights
In North America particularly, biosimilars grew 47% at constant currencies in the first half of the year, thanks to launches of bone disease drug Wyost and osteoporosis drug Jubbonti.
GLP-1 Market Opportunities
One of the largest opportunities for biosimilars and generics is the diabetes and obesity drug market.
Recent Approvals and Market Expansion
Last week, the Swiss maker of semaglutide received its first approval in Brazil for its multi-dose disposable pen.
In the United States, considered the biggest opportunity for the market, the Food and Drug Administration in June agreed to review two generic tirzepatide GLP-1s that, if approved, would rival obesity drugs made by Eli Lilly.
Sandoz does not expect a material contribution from any potential generic semaglutide launch in 2026.
Pricing Outlook and Financial Guidance
The group now expects pricing to decline by a mid-single-digit percentage in 2026, compared with a low-to-mid single-digit percentage decline seen previously, partly reflecting short-term market dynamics in Germany and strong biosimilar sales in North America.
Sandoz confirmed its full-year guidance for net sales and core EBITDA.
Policy Engagement and Industry Advocacy
Saynor also said the company is continuing dialogues with U.S. policymakers and that he had visited the White House following U.S. President Donald Trump's tariff threats to the generic industry in July.
(Reporting by Marleen Kaesebier; Editing by Friederike Heine, Subhranshu Sahu and Elaine Hardcastle)
