Novartis has been narrowing its focus to innovative medicines, and, more specifically, five therapeutic areas. But that doesn’t mean the Swiss pharma will leave respiratory and eye diseases altogether, CEO Vas Narasimhan, M.D., said Monday.
Novartis has “no intention” of cutting loose its respiratory and eye meds at the moment, Narasimhan said at the J.P. Morgan Healthcare Conference, refuting a recent Bloomberg report that the company is weighing various options, including divestitures, for those products.
“We’re very committed to Xolair,” Narasimhan said, calling the asthma and nasal polyps antibody treatment a “very attractive medicine.” The company is also committed to its ophthalmology brands, the CEO added. These include anti-VEGF drugs Lucentis and Beovu as well as Roche-partnered gene therapy Luxturna.
Narasimhan is in the process of giving Novartis a huge makeover. The company recently adopted a new organizational model in a restructuring that's showing some top executives and about 8,000 employees the exit. The drugmaker also laid out a plan to spin off generics unit Sandoz to focus on novel drugs.
Alongside the Sandoz separation, Novartis designated cardiovascular, immunology, neuroscience, solid tumors and hematology as its five core therapeutic areas going forward. Technically, Xolair also fits in the immunology group.
Compared with core focus areas, other assets will get fewer resources from a “relative prioritization” standpoint, Narasimhan said.
While noncore assets may not get much attention in Novartis’ overall business, “if something were to be a significant breakthrough [...] we could build back up,” Narasimhan said.
The CEO pointed to the company’s gene therapy candidate for the macular degeneration disease geographic atrophy. If the drug eventually shows it could meaningfully stop or slow deterioration, it would be a “very, very significant medicine.” Novartis brought the drug into the fold through its acquisition of British biotech Gyroscope Therapeutics, a deal that closed in February 2022.
Meanwhile, Narasimhan has made cell and gene therapy a technology platform of significant interest at Novartis. In gene therapy, the company is advancing more than 15 in-house projects, with the Gyroscope candidate the farthest along, Narasimhan noted.
Recent slimdowns—including a Roche stake sale—have given Novartis additional cash firepower to ink deals. Novartis continues to evaluate various M&A opportunities, but it’s trying to be “very disciplined,” Narasimhan said. The company is considering whether there’s real value creation and real strategic fit in its M&A moves, he said.
Novartis currently sees most of the M&A opportunities in deals below $4 billion to $5 billion rather than in huge deals, Narasimhan said.
Editor's Note: The story has been updated with the correct information that Novartis has more than 15—not 50—in-house gene therapy projects.