Novartis International AG, a leading international pharma giant from Switzerland, has posted strong growth in net profit of 24 per cent during the first quarter ended March 2014 to US$ 2,968 million from $2,393 million in the corresponding quarter of last year. The higher profit is due to pre-tax gain from of $0.9 billion from the divestment of the blood transfusion diagnostics unit to Grifols S.A.T. Its net sales, however, increased only by one per cent to $14,022 million from $13,879 million due to adverse exchange rates on account of the weakened yet and weakening emerging market currencies against the US Dollar. EPS worked out to $1.21 as against $0.97 in the last period.
Joseph Jimenex, CEO, said, “Novartis delivered a solid quarter, with all divisions contributing to growth. We made progress in innovation, including EU and US approval of Xolair in chronic spontaneous urticaria and significant milestones for Bexsero. The transformational deals announced on Tuesday position the company for future success based on our sharpened focus, innovation power and financial strength.”
The company completed the divestment of the blood transfusion diagnostics unit contained within its vaccines and diagnostics division on January 9, 2014. The former vaccines and diagnostics unit is now called the vaccines division, effective from January 1, 2014.
Its pharmaceuticals net sales declined by one per cent to $7,807 million from $7,877 million in the similar quarter of last year due to generic competition for Zometa/Aclasta. Quarterly volume growth was impacted by a slowdown of Gleevec/Glivec sales in the US. Growth products, including Gilenya, Afinitor, Tasigna, Galvus, Lucentis, Xolair, the Q Family and Jakavi, together generated net sales of 3.2 billion or 41 per cent of division net sales, compared to 35 per cent in the prior-year period.
The net sales of Alcon division improved by three per cent to $2,642 million, with strong growth in the surgical franchise tempered by moderate growth in ophthalmic pharmaceuticals. Surgical performance was driven by equipment growth, due in part to Alcon's new cataract surgery phacoemulsification platform, the Centurion Vision System, and demand for other equipment platforms.
Sandoz net sales increased by 3 per cent to $2,318 million. Asia (excluding Japan), Latin America and Japan delivered double-digit sales growth. Sandoz also continued to strengthen its leading position globally in biosimilars.
The net sales of vaccines went up sharply by 13 per cent to $215 million from $190 million due to the meningitis franchise, particularly Menjugate shipments to Latin America and strong sales of Menveo. The launch of Bexsero in several European private markets as well as Australia and Canada assisted well.
The company expects net sales in 2014 to grow at a low to mid-single digit rate and Group's operating income is expected to grow ahead of sales in 2014.