We continued to advance our broad range of efforts to support the COVID-19 pandemic response. Our growth drivers and launches continue their strong momentum, with Cosentyx and Entresto increasing market share in the US. We are on track to deliver on our commitment to drive consistent margin expansion and are excited by the progress of our deep mid to late stage pipeline to drive long-term growth'.
Constant currencies (cc), core results and free cash flow are non-IFRS measures. An explanation of non-IFRS measures can be found on page 54 of the Condensed Interim Financial Report. Unless otherwise noted, all growth rates in this Release refer to same period in prior year.
Refers to continuing operations as defined on page 42 of the Condensed Interim Financial Report, excludes
COVID-19 Update
The COVID-19 situation continues to evolve and is taking differing courses across the multitude of geographies that Novartis operates in. Our primary concerns remain the health and safety of our associates and patients while we also continue to take strong actions to help address the pandemic.
During the second quarter, COVID-19 had an impact on our business with forward purchasing from the first quarter largely reversing. Despite this our operations remain stable with record high customer service levels. Our cash collections continue to be according to our normal trade terms, and days sales outstanding at normal levels. Our product portfolio remains resilient despite COVID-19 negatively impacting sales in April and May, particularly: Lucentis and mature ophthalmology, new patient starts in dermatology and
At present drug development operations are continuing with manageable disruptions, with our SENSE and Site Cockpit digital technologies allowing us to proactively manage our clinical trials portfolio and rapidly mitigate site-level disruptions. Thus far, these measures have limited COVID-related impacts to our expected submission timelines over the next several years. Phase III clinical trials evaluating canakinumab in patients with pneumonia as a result of SARS-CoV-2 infection, and ruxolitinib in combination with standard of care compared to SoC alone, in collaboration with
In July, Novartis launched a first-of-its-kind not-for-profit portfolio of medicines for symptomatic treatment of COVID-19. The new portfolio of 15 medicines from the
Resolving legacy legal matters
We are continuing our long term journey to build trust with society and during the second quarter we resolved some of our legacy compliance issues. We finalized our
Financials
In order to comply with International Financial Reporting Standards (IFRS), Novartis has separated the Group's reported financial data into 'continuing' and 'discontinued' operations. The results of the
The commentary below focuses on continuing operations including the businesses of Innovative Medicines and
Continuing operations second quarter
Net sales were
Operating income was
Net income was
Core operating income was
Core net income was
Free cash flow from continuing operations amounted to
Innovative Medicines net sales were
Continuing operations first half
Net sales were
Operating income was
Net income was
Core operating income was
Core net income was
Free cash flow from continuing operations amounted to
Innovative Medicines net sales were
Discontinued operations
Discontinued operations include the business of
In the first half of 2020, there were no activities related to discontinued operations. In the first half of 2019, discontinued operations net sales were
For the total Group, net income amounted to
Disclaimer
This press release contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995, that can generally be identified by words such as 'continue,' 'growth,' 'expected,' 'to grow,' 'demonstrating,' 'to advance,' 'to support,' 'increasing,' 'to deliver,' 'to drive,' 'to evolve,' 'remain,' 'taking,' 'to take,' 'to help,' 'trends,' 'continuing,' 'allowing,' 'to start,' ' evaluating,' 'will,' 'until,' 'to build,' 'evolve,' 'launch,' 'continued,' 'continues,' 'to progress,' 'may,' 'retaining,' 'remains,' 'believe,' 'including,' 'can,' 'to create,' 'to find,' 'estimated,' 'impact,' 'ongoing,' 'submissions,' 'focus,' 'launches,' 'launch investments,' 'innovation,' 'potential,' 'guidance,' 'commitment,' 'pipeline,' 'aims,' 'momentum,' 'could,' 'would,' 'launched,' 'on track,' 'growing,' 'progressing,' 'expanding,' 'pending,' 'strongly,' 'priority,' 'filings,' 'outlook,' 'unforeseen,' 'forecast,' 'prevail,' 'enter,' 'to improve,' 'transformative,' 'innovative,' 'inventive,' 'manageable disruptions,' 'expect,' 'planned,' 'working,' 'monitoring,' 'anticipated,' 'continuously,' 'on track,' or similar expressions, or by express or implied discussions regarding potential new products, potential new indications for existing products, potential product launches, or regarding potential future revenues from any such products; or regarding our estimates of the impact of past and future COVID-19 related forward purchasing on sales and on our performance; or regarding the impact of the COVID-19 pandemic on clinical trials, and research and development timelines; or regarding potential future, pending or announced transactions; regarding potential future sales or earnings of the Group or any of its divisions; or by discussions of strategy, plans, expectations or intentions; or regarding the Group's liquidity or cash flow positions and its ability to meet its ongoing financial obligations and operational needs; or regarding efforts to provide a not-for-profit portfolio of medicines for symptomatic treatment of COVID-19. Such forward-looking statements are based on the current beliefs and expectations of management regarding future events, and are subject to significant known and unknown risks and uncertainties. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those set forth in the forward-looking statements. You should not place undue reliance on these statements. In particular, our expectations could be affected by, among other things: liquidity or cash flow disruptions affecting our ability to meet our ongoing financial obligations and to support our ongoing business activities; the impact of the COVID-19 pandemic on enrollment in, initiation and completion of our clinical trials in the future, and research and development timelines; the impact of a partial or complete failure of the return to normal global healthcare systems including prescription dynamics, particularly ophthalmology, in the second half of 2020; global trends toward healthcare cost containment, including ongoing government, payer and general public pricing and reimbursement pressures and requirements for increased pricing transparency; uncertainties regarding potential significant breaches of data security or data privacy, or disruptions of our information technology systems; regulatory actions or delays or government regulation generally, including potential regulatory actions or delays with respect to the development of the products described in this press release; the potential that the strategic benefits, synergies or opportunities expected from the transactions described, may not be realized or may be more difficult or take longer to realize than expected; the uncertainties in the research and development of new healthcare products, including clinical trial results and additional analysis of existing clinical data; our ability to obtain or maintain proprietary intellectual property protection, including the ultimate extent of the impact on Novartis of the loss of patent protection and exclusivity on key products that commenced in prior years and is expected to continue this year; safety, quality, data integrity, or manufacturing issues; uncertainties involved in the development or adoption of potentially transformational technologies and business models; uncertainties regarding actual or potential legal proceedings, investigations or disputes; our performance on environmental, social and governance measures; general political, economic and business conditions, including the effects of and efforts to mitigate pandemic diseases such as COVID-19; uncertainties regarding future global exchange rates; uncertainties regarding future demand for our products and other risks and factors referred to in
About Novartis
Novartis is reimagining medicine to improve and extend people's lives. As a leading global medicines company, we use innovative science and digital technologies to create transformative treatments in areas of great medical need. In our quest to find new medicines, we consistently rank among the world's top companies investing in research and development. Novartis products reach nearly 800 million people globally and we are finding innovative ways to expand access to our latest treatments. About 110,000 people of more than 145 nationalities work at Novartis around the world.
Contact:
Tel: +41 61 324 1374
Email: antonio.ligi@novartis.com
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