Eyeing the Future, Novartis Plans for Growth with Share Buyback

Vasant Narasimhan_Novartis

Novartis Chief Executive Officer Vas Narasimhan. Photo courtesy of Novartis.

Novartis leadership is excited by the future of its pipeline and its perceived capabilities to fuel growth. To support its long-term goals, the Swiss pharma giant is initiating a share-buyback program of up to $2.5 billion that is expected to be carried out over the next few months.

This morning, Novartis is showing off its pipeline during the virtual Meet Novartis Management event that gives investors and industry analysts an opportunity to meet with key company executives. The purpose of the meeting is to provide those attendees with a deep look into the company’s pipeline in order to gain an understanding of Novartis’ growth strategy.

Among the highlights for the meeting will be deep looks at five key products already on the market that are expected to serve as catalysts for near term growth. Entresto (sacubitril/valsartan) is under review by the U.S. Food and Drug Administration for the treatment of heart failure with preserved ejection fraction. In addition to that indication, Phase III results are expected in the first half of next year from the PARADISE MI trial studying Entresto in patients with acute myocardial infarction. Cosentyx (secukinumab) continues to show its strength in dermatology. Findings from a Phase III trial in hidradenitis suppurativa are expected in the second half of 2021, the company said. Earlier this year, Cosentyx won approval for a new indication to treat active non-radiographic axial spondyloarthritis, a disease characterized by inflammatory arthritis of the spine associated with chronic inflammatory back pain. Kisqali (ribociclib) continues to grow in-market with overall survival data in aBC from the MONALEESA-2 trial anticipated in the second half of 2021. Alpelisib (BYL719) is on track for a U.S. submission in PIK3CA-Related Overgrowth Spectrum (PROS) in 2021. Also, Novartis said Beovu (brolucizumab) is progressing in Phase III development for diabetic macular edema (DME) with a potential submission planned in 2021.

During today’s meeting, Novartis will showcase its pipeline that includes 116 different assets in Phase I and Phase II development, as well as 49 Phase III programs. The company will also highlight more than 65 new molecular entities.  

Those mid-to-late-stage assets will serve as key drivers. During its presentation, the company pointed to several key clinical milestones expected in the near future. First, Novartis anticipates the FDA to make a ruling on Inclisiran for the treatment of adults with hypercholesterolemia or mixed dyslipidemia. The FDA is expected to make a decision in December. Other assets expected to serve as key drivers include Iptacopan (LNP023), a potential first-in-class oral factor B inhibitor in development for several rare renal diseases and a hematological disorder, is expected to begin Phase III development for IgA Nephropathy (IgAN) in the first half of 2021. Iscalimab (CFZ533) is an anti-CD40 antibody in development across multiple indications including Sjögren’s syndrome and kidney and liver transplantation. First results are expected in 2022. The FDA granted orphan drug designation for the company’s orally administered, small molecule RNA splicing modulator branaplam (LMI070) for the treatment of Huntington’s disease. A Phase IIb study in Huntington’s disease patients is planned to begin in the first half of 2021.

In oncology, Novartis pointed to five mid-to late-stage assets with key milestones expected in 2021. A Phase III readout for canakinumab in non-small cell lung cancer is expected in 2021. Novartis plans to submit Sabatolimab, an anti-TIM-3 monoclonal antibody, to the FDA in the second half of 2021 for high-risk myelodysplastic syndrome patients, pending a Phase III readout. The company is also expecting Phase III data from Lu-PSMA-617 in metastatic castration-resistant prostate cancer in the first half of 2021. Two other promising oncology assets are TNO155, a SHP2 inhibitor, and LXH254, a selective B/C RAF inhibitor.

Novartis’ robust pipeline is expected to fuel growth in the mid-to-long-term, with around 90% potential first-in-class/first-in-indication medicines and about 80% of targets in areas of high unmet patient need, the company said. Novartis added that it is strengthening its advanced therapy platforms along the value chain with 20 advanced platform therapies in clinical development alongside a large number of pre-clinical projects.

Novartis Chief Executive Officer Vas Narasimhan touted the company’s pipeline, noting that the investigational medications under development demonstrate long-term growth capabilities for the company. The company’s confidence in its developmental medications sparked the stock buyback, Narasimhan said.

“Novartis offers a unique profile as a fully focused company with diversification across therapeutic areas and geographies, while providing exposure to cutting-edge platforms. We have delivered strong operational performance, growing the top-and-bottom- line and delivering on our commitment to margin expansion. Our rich pipeline continues to advance, and we highlight many assets that show significant promise,” Narasimhan said in a statement ahead of the annual meeting.

That robust pipeline will translate into significant revenue streams. The company projects that the total value of estimated sales of products launched from 2020 to 2026 puts Novartis as number two for pipeline replacement power in the global pharmaceutical industry.

In addition to the assets in its pipeline, Novartis said it is making significant progress on the manufacturing and commercialization of these advanced therapy platforms.

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