Call it the Swiss strategy squabble. In advance of his first big public show since taking over Novartis ($NVS) as chief executive, Joe Jiminez (photo) talked strategy with the Financial Times--and defended the company's "focused diversification" approach to battling the patent cliff. Apparently, last month Roche CEO Severin Schwan (photo) derided that master plan, saying, "A lot of people call it diversification. I call it giving up."
Jiminez doesn't like the "quitter" label, obviously, so he pointed out that other pharma companies are taking the same tack, broadening their businesses as a hedge against big competition from generic drugs, and Novartis hasn't "given up" on prescription drugs. "We're not giving up on the traditional model or the focus on research and development," he told the FT. "I absolutely don't see it as surrendering."
Sticking to the status quo isn't an option, Jiminez argues, and he's right that the entire drug industry is revamping itself in one way or another--and many companies are going the diversification route, whether by expanding into generic drugs, growing consumer healthcare divisions, or, like Novartis, getting into a separate-but-related business like eye-care. And he's right that drug development has slowed down, forcing pharma to re-examine its R&D approach.
Jimenez tomorrow will release more specifics on how he intends to address the loss of patent protection on its big-selling blood pressure drug Diovan. And he promises a rundown on his plans for growth in each of the company's divisions.
- read the FT piece
ALSO: Novartis may well continue to operate Alcon, the eye-care company, with only the 77 percent stake it bought from Nestle; an offer for the minority interest remains on the table, and the company doesn't plan to sweeten it anytime soon, because currency and stock-market fluctuations have made the deal more attractive already, Jiminez said. Report