Novartis saw its profit climb 7% in the first quarter - and actually 10% at constant exchange rates (CER) - as strong performances by its 'growth' products and emerging markets helped overcome the drag of generic competition.
The Basel, Switzerland-headquartered group booked core net income of $3.25 billion for the period ended March 31, overshooting an average analyst estimate compiled by Bloomberg of $3.12 billion.
The impact of patent losses was estimated at around $500 million, but net sales came in at $14 billion, rising 2% (or 4% at CER) from a year ago.
Growth products - including the MS drug Gilenya (up 71% at CER at $421 million), Afinitor for kidney cancer (+114% at $303 million), leukaemia drug Tasigna (+39% at $284 million), diabetes therapy Galvus (+40% at $267 million), eye drug Lucentis (+7% at $596 million), Xolair for asthma (+29% at $141 million), COPD therapy Arcapta Neohaler/Onbrez Breezhaler (+48% at $43 million) and blood cancer drug Jakavi ($35 million) - collectively grew 14% to $4.2 billion, equating to 30% of group net sales.
Overall, emerging growth markets also did well, rising 9%, with notable performances in China (+21% at CER) and Russia (+33% at CER), the drug giant said.
Taking a closer look, at $7.9 billion sales of pharmaceutical products stayed level with the first quarter of 2012, reflecting the battle between generic erosion and growth.
Elsewhere, Alcon generated net sales of $2.6 billion, up 1 % over the year-ago quarter, Sandoz turned in sales of 6% to $2.3 billion, Vaccines and Diagnostics grew 9% to $327 million, and Consumer Health returned to growth during the period with turnover rising 6% to $987 million.
Pleased with performance, but generics will bite
All-in-all, Novartis said it is pleased with its performance during the quarter, in which it racked up eight regulatory approvals in the EU and US to help fuel further growth.
Looking forward, its outlook for the year remains unchanged; group net sales are expected to be in line with 2012 in constant currencies, after absorbing the impact of generic competition, which could equate to as much as $3.5 billion, it warned.
In line with this, core operating income at CER is expected to decline in 2013 in mid-single digits, as the impact of generic competition is coupled with the expense of "an unprecedented number of launches".
Meanwhile, Novartis also named its chief financial officer (CFO) of pharmaceuticals Harry Kirsch as its new group CFO, taking over from Jon Symonds.