Novartis International AG has suffered a setback during the first quarter ended March 2011 on account of additional costs related to acquisition of Alcon. The net profit declined by 4.3 per cent to US$ 2821 million from $2048 million in the corresponding period of last year. Its operating income also moved down by 2.9 per cent to $3,408 million from $3,511 million. However, its net sales increased by 15.6 per cent to $14,027 million from $12,131 million. With lower net profit, its earnings per share worked out to $1.21 as against $1.29 in the last period.
Joseph Jimenez, CEO, said, “Contributions from all businesses led to a good start in 2011, as we achieved 14 per cent growth in the first quarter. We maintained our innovation momentum with new approvals for our multiple sclerosis treatment Gilenya and our eye care treatment Lucentis in the EU. Additionally, promising results of numerous clinical trials, including a Phase III study involving JAK inhibitor INC-424, again showed the success of our novel approach to R&D. In April, we completed our merger with Alcon, the leading eye care business in the world, creating the second-largest business in the Novartis portfolio.”
The company's pharmaceutical sales grew by 7 per cent to $7,765 million from $7,291 million in the similar period of last year. The sales of vaccines and diagnostics declined sharply to $371 million from $1,361 million and that of Sandoz division moved up by 16 per cent to $2,318 million from $2001 million. The sales of Novartis Group excluding Alcon, Inc., declined to 12,096 million from $12,131 million.
The pharmaceutical sales in US increased only by 2 per cent to $2,427 million and that in Europe improved by 3 per cent to $2,833 million. Asia/Africa/Australasia sales increased by 18 per cent to $1,783 million from $1,510 million. However, excluding Alcon's sales, the sales in US and Europe declined by 2 per cent respectively.
Its breakthrough oral multiple sclerosis treatment – Gilenya was approved for use in the EU, Switzerland and Australia, among other countries. Lucentis was approved in the EU for the treatment of diabetic macular edema, a leading cause of blindness for which there had previously been no approved therapies. In vaccines and diagnostics, its meningococcal vaccine Menveo was approved for use in the US for children from 2 to 10 years of age in the prevention of this deadly disease.
The worldwide sales of Diovan for hypertension declined to $1,405 million from $1,442 million in the last period on account of competition from generic products and price pressure. The sales of Gleevec/Glivec remained almost stagnant and improved only by 4.3 per cent to $1,076 million from $1,032 million. The sales of Lucentis went up by 22 per cent to $444 million from $364 million. Lucentis is approved in more than 85 countries for the treatment of wet AMD and in more than 30 countries for the treatment of visual impairment due to DME.
The company's research and development expenditure increased by 7 per cent to $2188 million from $2037 million in the corresponding period of last year.