Novartis took its first big hit from new Diovan generics during last year's third quarter, when Ranbaxy Laboratories finally won approval for its exclusive generic of the blood pressure pill. And it was indeed a big hit: a 76% drop in U.S. sales for the franchise, to $97 million.
Novartis continues the protracted drawdown at its Diovan plant in New York, telling the state nearly two dozen more jobs will be whacked starting at the end of March.
Novartis has notified the state of New York of its 83-employee layoff beginning Dec. 31 at its plant in Suffern, NY, a facility that will close in 2016, at which point essentially all traces of it will be eliminated.
When Novartis put a closure target on its plant in Suffern, NY, it indicated that it might go as far as to strip out the equipment, raze the buildings and sell empty land. But the 160-acre campus is now officially on the block and being brokered as a great buy for the right drug manufacturer.
Take a look at Novartis' second-quarter results for reasons why it engineered that big asset swap-and-sale with GlaxoSmithKline and Eli Lilly. The two units Novartis is unloading, vaccines and animal health, delivered weak sales for the quarter, dragging the company's top line below expectations.
Last month, Japanese authorities arrested an ex-Novartis employee who allegedly manipulated trial data later used to promote the blockbuster blood pressure med Diovan. But now, it looks as if he may not be the only one paying the price.
Both the active pharmaceutical and the formulation plants in India that Ranbaxy Laboratories planned to use to manufacture the long-delayed generic of Novartis' blood pressure drug Diovan are under FDA import alerts. But the Indian drugmaker has finessed a manufacturing workaround with the agency to make the heart drug at its Ohm Laboratories plant in New Jersey.
The long-delayed and highly anticipated launch of generic Diovan is on the way, which is a bummer for Novartis and a huge boost for Indian drugmaker Ranbaxy Laboratories. It is also validation for the decision by Sun Pharmaceutical's owner, billionaire Dilip Shanghvi, who struck a $3.2 billion deal to buy Ranbaxy despite its years of FDA entanglements over quality issues.
After Japanese authorities arrested an ex-Novartis employee Wednesday, prosecutors raided the company's Tokyo office to continue their probe into data manipulation. The move comes six months after Japan's health ministry first filed a complaint to prosecutors alleging that the company used exaggerated advertising to market the blood pressure drug Diovan.
Japanese police brought in Nobuo Shiraishi, a former Novartis worker linked to discredited studies of the company's blood pressure drug Diovan. Shiraishi is suspected of violating the country's pharma laws by providing false data to researchers, Tokyo prosecutors said in a statement.