Novartis could part ways with Sandoz

Oct. 26, 2021

Novartis is mulling a sale or spin off of its generics business, Sandoz.

According to the company’s CEO, Vas Narasimhan, Novartis has begun a strategic review of Sandoz to decide if it’s still a good fit with the company’s long-term growth plans. 

Sandoz was originally launched as a generics division of Novartis in 2003. Although Sandoz has become a world leader in generics manufacturing, and its volume of sales has increased in recent years, the company has still been hit by the various factors putting downward pricing pressures on the generics industry such as increased competition and consolidation among buyers. Although Sandoz has pivoted towards higher-value products, such as biosimilars, its earnings have still dropped. Sandoz’s sales fell by 2% to $2.4 billion total in Q3, the Wall Street Journal reported

Under Narasimhan, Novartis has sharpened its focus on innovator drugs such as gene therapies, which could impact its decision about whether or not to keep Sandoz under its sphere.