Novartis AG (NYSE:NVS; SIX:NOVN), a Swiss-based biopharmaceutical company, has announced its second quarter results showing net sales of $13.2 billion for the period, of which net sales for ophthalmology products totaled $1.18 billion. Novartis recently announced the sale of its stake in the GSK consumer healthcare joint venture for $13 billion, and its plan to spin out its Alcon division while maintaining its ophthalmological product portfolio, again with the intention of focusing Novartis on developing further as a “leading medicines company”. Ophthalmology sales for the period fell by 3% due to generic erosion in the US however, the company believe this is partly offset by growth of Lucentis in the US market which reached sales of $515 million. Full year expected sales for Lucentis are projected to exceed $1.035bn
Following the announcement by Novartis to spin out its Alcon eye care business, the divestiture is not expected to have any impact on the company’s payment of a strong and growing dividend in Swiss francs, according to the company. Alcon’s surgical and vision care lines are understood to have provided $6.7 billion in sales in 2017, while pharmaceutical lines in ophthalmology provided $4.5 billion in sales in the same period. As previously reported, it is expected that the new company will be head-quartered in Switzerland, with planned dual listings on the SIX Swiss Exchange and NYSE. The new entity will have a headcount in excess of 20,000 employees.
Net sales in Novartis for the first half of FY2018 reached almost $26 billion. Comparable full year performance will depend on several factors, including generic competition, delivery on CAR-T therapeutics and currency impacts from a strengthened dollar. Commenting on the Q2 results, Novartis’ CEO Vasant Narasimhan stated, “this quarter, and really for the whole first half of this year, we’re continuing our transformation into a focused medicines company. When you go back to 2014 pre the transformation, we really had a mixed business more about health care conglomerate. And now with the actions we’ve taken over the first half of the year, we really shifted the company post the proposed Alcon spin-off to a 100% medicines company”.