Novartis sales advance in 2Q, though Chiron weighs on profits

Swiss drugmaker Novartis has posted an 18% rise in second-quarter pharmaceutical sales, beating the industry average, but net income was pegged back by the company’s acquisition of Chiron.Net income came in at $1.7 billion, up 4%, which was a little behind a poll of analysts forecasts. But Novartis also gave a bullish outlook for the whole of 2006, predicting that overall sales would grow in the double digits, with pharma sales growing in the high single digits.Overall sales of $9.2 billion included a contribution from pharma of $5.7 billion, up 11%, while the new vaccines and diagnostics division, created following the Chiron acquisition, contributed $127 million.The pharma division was boosted by the new Medicare legislation in the USA, which has increased the use of prescription medicines among older people, with Novartis’ oncology and cardiovascular franchises showing a particularly good performance.Second-quarter sales of blood pressure drugs Diovan (valsartan) and Co-Diovan (valsartan and hydrochlorothiazide) grew 16% to $1.04 billion, while another antihypertensive sold in the USA only, Lotrel (amlodipine and benazepril), climbed 20% to $348 million on the back of a shift to combination treatment for high blood pressure. Heading the oncology franchise, Glivec (imatinib) advanced 19% to $640 million, shrugging off the onset of competition from Bristol-Myers Squibb’s recently-launched Sprycel (dasatinib).On the downside, Lamisil (terbinafine) sales fell 10% in the second quarter to $283 million on the back of generic competition which started to emerge in Europe.Generics unit Sandoz reported the strongest sales growth, up 74% to $1.45 billion, largely on the back of the contributions of the recently-acquired Hexal and Eon Labs businesses, with compulsory pricing reductions in Germany holding back the result. Novartis’ consumer health business saw sales climb 4% to $1.9 billion.A number of Novartis’ older top 10 products are starting to show some signs of sales shrinkage (see table below), but newer products outside the top 10 – notably Femara (letrozole) for breast cancer and Zelnorm/Zelmac (tegaserod) for irritable bowel syndrome, are growing fast and should break into the top ranks soon. Meanwhile, Novartis said it remained on track to file two key pipeline projects - Galvus (vildagliptin) for diabetes and Rasilez (aliskiren) for hypertension - in Europe later this year, having already submitted them in the USA.Top 20 Novartis products by sales – first half 2006

Swiss drugmaker Novartis has posted an 18% rise in second-quarter pharmaceutical sales, beating the industry average, but net income was pegged back by the company’s acquisition of Chiron.Net income came in at $1.7 billion, up 4%, which was a little behind a poll of analysts forecasts. But Novartis also gave a bullish outlook for the whole of 2006, predicting that overall sales would grow in the double digits, with pharma sales growing in the high single digits.Overall sales of $9.2 billion included a contribution from pharma of $5.7 billion, up 11%, while the new vaccines and diagnostics division, created following the Chiron acquisition, contributed $127 million.The pharma division was boosted by the new Medicare legislation in the USA, which has increased the use of prescription medicines among older people, with Novartis’ oncology and cardiovascular franchises showing a particularly good performance.Second-quarter sales of blood pressure drugs Diovan (valsartan) and Co-Diovan (valsartan and hydrochlorothiazide) grew 16% to $1.04 billion, while another antihypertensive sold in the USA only, Lotrel (amlodipine and benazepril), climbed 20% to $348 million on the back of a shift to combination treatment for high blood pressure. Heading the oncology franchise, Glivec (imatinib) advanced 19% to $640 million, shrugging off the onset of competition from Bristol-Myers Squibb’s recently-launched Sprycel (dasatinib).On the downside, Lamisil (terbinafine) sales fell 10% in the second quarter to $283 million on the back of generic competition which started to emerge in Europe.Generics unit Sandoz reported the strongest sales growth, up 74% to $1.45 billion, largely on the back of the contributions of the recently-acquired Hexal and Eon Labs businesses, with compulsory pricing reductions in Germany holding back the result. Novartis’ consumer health business saw sales climb 4% to $1.9 billion.A number of Novartis’ older top 10 products are starting to show some signs of sales shrinkage (see table below), but newer products outside the top 10 – notably Femara (letrozole) for breast cancer and Zelnorm/Zelmac (tegaserod) for irritable bowel syndrome, are growing fast and should break into the top ranks soon. Meanwhile, Novartis said it remained on track to file two key pipeline projects – Galvus (vildagliptin) for diabetes and Rasilez (aliskiren) for hypertension – in Europe later this year, having already submitted them in the USA.Top 20 Novartis products by sales – first half 2006

 Diovan/Co-Diovan $1,983m +13%
 Gleevec/Glivec $1,199m +16%
 Lotrel $643m +26%
 Zometa $627m +3%
 Lamisil $483m -14%
 Neoral/Sandimmun $449m -4%
 Sandostatin $439m -3%
 Lescol $356m -6%
 Trileptal $352m +20%
 Voltaren $337m -3%

Source: Novartis