Novartis

Novartis' new building, designed by renowned architect Frank Gehry

Created in 1996 through the merger of Ciba-Geigy and Sandoz, Novartis (its name derived from the Latin for ‘new skills’) is one of Switzerland’s two major pharma companies, Roche being the other.

Among its star performers are cancer treatment Glivec, and blood pressure treatment Diovan, but the latter is approaching its US patent expiry.

In January 2010, Joe Jimenez took over as chief executive from Daniel Vasella, who had been at the helm for 14 years. Formerly head of Novartis' pharmaceutical business, Jimenez said from the outset that he would 'de-layer and simplify' the top leadership structure.

Novartis posted strong sales growth in 2010 but its chief executive warned of ‘headwinds in 2011’ as patent expiries start to bite.

Net sales for 2010 grew by an impressive 14% to $50.6 billion, buoyed by strong growth of its wet age-related macular degeneration drug Lucentis, which increased by 24% to $1.53bn.

Cancer drug Glivec also did well, growing by 8% to $4.27 billion for the full year, but Novartis faces will soon face the patent expiry of its biggest earner Diovan.

The blood pressure drug’s 2010 sales remained flat at $6.1 billion and Novartis is keen to offset the losses the lack of exclusivity will bring by diversifying its business model.

Moves towards this last year included its acquisition of Alcon, which made Novartis the world’s biggest ophthalmology company.

Novartis is also looking for future growth to come from its pipeline, which containing several dozen medicines with a number of potential blockbusters, including experimental respiratory drug QVA149.

The company has made a strong start to 2011, with the launch of its new oral multiple sclerosis drug Gilenya (fingolimod), predicted to reach $2.5 billion in peak year sales. 

Given its strong pipeline and new launches, Novartis said it expected sales growth in its core pharma division is set reach the low- to mid-single digits this year.

Jimenez said: “I am proud that Novartis continues to lead the industry in innovation, with 13 key product approvals and 16 major filings in pharmaceuticals in 2010, including our breakthrough multiple sclerosis therapy, Gilenya, which has been launched in the US.”

But he also warned of rough times ahead: “We are facing more headwinds in 2011 than in 2010 ... as this is the first year we are faced with patent expirations,” he told the Wall Street Journal.

“We expect, however, to offset the effect of these patent expirations. The fact that we expect to grow in 2011 is showing this.”

View the company's pipeline here