Giovanni Caforio, M.D., is lining up a new gig soon after handing all his Bristol Myers Squibb leadership roles over in March. The recent Big Pharma CEO has been proposed as the new chair at Novartis.
Caforio, 59, will stand for election as chair of Novartis’ board of directors at the Swiss pharma’s next annual general meeting in 2025, when current Chair Joerg Reinhardt ends his 12-year tenure, Novartis said Tuesday during its first-quarter financial results.
Caforio was CEO of BMS from May 2015 to November 2023 and continued his service as the executive chair before handing the new helmsman Chris Boerner, Ph.D., the top board job as well at the beginning of this month.
It’s unconventional—to say the least—for a Big Pharma CEO to become a rival drugmaker’s chair. In a Tuesday release, Novartis credited Caforio for transforming BMS into “a global medicines company with strong capabilities across R&D and commercialization.”
Novartis’ board went through a thorough search process before choosing Caforio, Chief Financial Officer Harry Kirsch told reporters during a press call on Tuesday.
“The board was looking for candidates with strong industry experience and expertise, and leading also a pure-play pharma company, given our strategy and focus. And the key focus was on finding a candidate with a deep understanding of the strategic trajectory of Novartis,” Kirsch said. “And priority was also given to candidates with global experience, including extensive knowledge of the U.S. market, where we also aspire to become a top player.”
Novartis recently became a pure-play innovative medicines company after separating the generics maker Sandoz. The company also adopted a “U.S.-first” mindset, putting the U.S. market center in its decision-making on R&D, business development, commercialization and patient services.
Caforio’s nomination also raises the question of whether Novartis will be changing its dealmaking strategy. The former BMS chief executive was known for striking some of the industry’s largest M&As, including the $74 billion acquisition of Celgene in 2019 and the $13.1 billion deal for MyoKardia in 2020. The New Jersey pharma jumped on an M&A spree toward the end of 2023, while Caforio was still executive chair.
By contrast, Novartis is historically not an aggressive buyer in the pharma space. Some of its largest deals in the past two decades include the $39 billion deal for Alcon, which Novartis has later spun off into a separate eye care business. In terms of drugs, the $9.7 billion buyout of The Medicines Company was among Novartis’ largest in recent years. Since then, CEO Vas Narasimhan has been pointing to bolt-on deals of the size around or below $5 billion as Novartis’ dealmaking strategy.
According to Kirsch, those bolt-on deals remain Novartis’ sweet spot—at least for now.
“This absolutely does not change anything of our strategy,” Kirsch said of Caforio’s nomination during a press call Tuesday. “Our focus is on strong internal R&D, and continuous to increase our already good R&D productivity further, and then bolt-on M&A to strengthen our four [therapeutic areas].”
But the CFO also added that since Caforio’s nomination is about a year from now, “I’m sure until then there will be other discussions,” although there’s currently no change of strategy.
Novartis is currently in the process of acquiring MorphoSys for 2.7 billion euros ($2.9 billion) with eyes on the German biotech’s BET inhibitor candidate pelabresib.
In answering a separate question about M&A appetite, Kirsch again highlighted that $5 billion is “more likely” to be Novartis’ targets in the future, while conceding that “it’s never a formula.”