As former parent company Novartis centres its efforts on its “pure-play” innovative medicines business, Sandoz is increasingly betting on biosimilars. Having already launched a version of AbbVie’s blockbuster arthritis treatment Humira, the newly spun-off company has been gearing up for its independence by preparing additional biosimilar launches, signing big partnership deals and increasing its manufacturing capacity.
In the last four years, we’ve nearly tripled the number of biosimilars in partnership and development
Richard Saynor, CEO, Sandoz
Novartis: “Pure-play” Innovative Medicines
In its recent Q4 financial results report, the first since the spin-off of Sandoz earlier this month, Novartis reported sales growth of 12 percent year-over-year and a rise in its net income of 37 percent. The figures appear to validate the Swiss giant’s move to offload its generics and biosimilars arm, Sandoz.
After initially putting the spin-off on the table in 2022, Novartis shareholders finally approved it and earlier this month the new independent company listed on the SIX Swiss Exchange at a valuation of USD 11.2 billion. Novartis, now that it has let Sandoz go, will focus on what the company terms “pure-play” innovative medicines, centring its efforts on four core therapeutic areas: cardiovascular, renal and metabolic; immunology; neuroscience, and oncology.
“We have successfully executed the spin-off of Sandoz, allowing us to fully focus on high-value innovative medicines,” said Novartis CEO Vas Narasimhan. “Our growth drivers, including Kesimpta, Entresto, Kisqali and Pluvicto, continue to perform well in the market. Our robust pipeline also continues to deliver, and we have achieved important innovation milestones for Pluvicto, iptacopan, remibrutinib and Lutathera.”
Sandoz: Biosimilars Focus
Upon announcing its independence from Novartis, Sandoz said that its purpose remained unchanged, yet that as a free-standing company it would be better placed to deliver on its strategy. “As an independent company, Sandoz will be fully enabled to deliver on its purpose-driven strategy, which targets sustainable leadership in the growing and critical generics and biosimilars industry,” stated CEO Richard Saynor.
Yet long before the spin-off, Sandoz was already making a clear emphasis shift towards biosimilars. Despite a decline in revenues that reached as far back as 2016, in June the company projected additional sales of USD 3 billion over the next five years, thanks to its newfound focus on biosimilars.
“In the last four years, we’ve nearly tripled the number of biosimilars in partnership and development,” Saynor said at the time. “More than 50 percent of the launch contribution going forward will come from biosimilars, driving the mix and driving the growth.”
Amgen may have got there first, but the launch of Sandoz’ biosimilar version of AbbVie’s blockbuster arthritis treatment Humira is one of its most promising. The firm is also planning other “potential high-value upcoming launches over the next few years,” according to Saynor, including biosimilars of Biogen’s Tysabri and Regeneron and of Bayer’s Eylea.
In addition, Sandoz prepared for its separation from Novartis by signing partnership deals, like the agreement for the commercialisation of Samsung Bioepis’ biosimilar version of Johnson & Johnson’s blockbuster Stelara in the US and Canada as well as several countries in Europe.
Moreover, at least 55 big selling biologics will be coming off patent in the United States and Europe over the next decade, presenting fresh opportunities for Sandoz.
“I see strong growth drivers in terms of accessing that opportunity,” Saynor said. “And the biosimilar element will be the fastest growing with relatively lower levels of competitive intensity.”
To fuel its biosimilar push, in July Sandoz announced a USD 90 million investment in a new biosimilar technical development centre in Ljubljana, Slovenia, an end-to-end drug substance and drug development complex set to be completed in 2026. The centre aims to complement the firm’s other new plant in Lendava, Slovenia, as well as its biosimilar development facility in Holzkirchen, Germany.
