Novartis Reports Net Income Rises 10 Percent in Second Quarter

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BASEL, Switzerland—Swiss pharmaceutical company Novartis (NYSE: NVS) reported second quarter results with net income rising 10 percent to $1.98 billion from $1.81 billion compared with the year-ago period, while sales fell 2 percent to $12.24 billion. For the year's first half, net profit was off 5 percent at $3.64 billion and sales slipped 1 percent to $23.78 billion.

Commenting on the results, Novartis CEO Joseph Jimenez said, "Novartis delivered very strong innovation in Q2 including the positive pivotal trial readouts for RTH258, ACZ885 and CTL019 JULIET, demonstrating the strength of our pipeline. We are on track for the full year guidance. The trajectory of the current growth drivers reinforces our confidence in our next growth phase, which we expect to start in 2018."

The Alcon division grew sales 3 percent in the second quarter driven by surgical, up 3 percent and there was continued growth in the vision care market, which was up 2 percent. According to an announcement from Novartis, “These results reflect the actions taken to accelerate innovation, strengthen customer relationships and improve the efficiency and effectiveness of operations. Based on these results, the full year guidance for Alcon has been revised upward to low single digit growth.”

Jimenez said, "Within surgical, we saw growth in key segments, including IOLs, which grew for the first time since 2014. We are starting to see the uptick in new innovative products that we have launched including UltraSert, which is our preloaded IOL as well as PanOptix, which is our trifocal IOL, both of those in Europe and then ReSTOR +2.5 Toric in the U.S.

The company said, the return to sales growth in surgical was driven by growth in key segments, including strong performance in vitreoretinal and cataract consumables, as well as IOLs returning to growth globally. The division also invested in expanding its new product launches, including CyPass Micro-stent, a micro invasive Glaucoma surgical device to lower intraocular pressure. CyPass received U.S. reimbursement in July and was launched in the Europe during the quarter.

In vision care, contact lenses grew for the fifth consecutive quarter driven by Dailies Total1 growth in all regions, the company reported.

In January 2017, VMail reported that Novartis announced a strategic review of Alcon. Options to maximize shareholder value of the Alcon division are under consideration. A status update will be provided toward the end of 2017, the company said.