Novartis earnings dip as cancer drug faces generic competition

Novartis’s second-quarter earnings declined 3 per cent as the company grapples with tumbling sales of its cancer medicine Gleevec and invests in new products like heart drug Entresto and Cosentyx for psoriasis.

Profit fell to $1.23 a share, excluding some items, the company said Tuesday in a statement. Analysts estimated $1.19. Revenue dropped 2 per cent to $12.5 billion, compared with analysts’ average forecast of $12.2 billion.

Novartis is depending on Entresto and Cosentyx as its blockbuster Gleevec faces generic competition in the United States and sales at its eye-care division Alcon slump.

Entresto, projected by the company to eventually hit peak sales of $5 billion a year, has received a warmer reception in Europe than the US, the largest market for pharmaceuticals, since its introduction a year ago.

Cosentyx brought in $260 million, beating estimates of $206 million.

Novartis said 2016 sales and profit will be largely unchanged from last year on a constant currency basis, while increased spending on the launch of Entresto and declining Gleevec sales means profit could fall by a low single digit. – Bloomberg