Novartis weighs sale of ophthalmology, respiratory units (Bloomberg)

Novartis weighs sale of ophthalmology, respiratory units (Bloomberg)

Nov 16 (Reuters) – Swiss drugmaker Novartis AG (NOVN.S) is considering selling its ophthalmology and respiratory units, a Bloomberg report said on Wednesday, citing people familiar with the matter.

The company is seeking to raise money from the possible sale of the assets to invest in cutting-edge medicines, the report said, adding that the ophthalmology unit could alone fetch about $5 billion.

The drugmaker declined to comment on the report.

Novartis in August said it was planning to spin off its generics unit Sandoz to sharpen its focus on its patented prescription medicines.

The company spun off its Alcon eye care business in 2019, and in November last year agreed to sell a nearly one-third voting stake in Roche (ROG.S) as it seeks to streamline operations.

Sandoz sales have been hurt by pricing pressure that has affected the broader generics industry for years, particularly in the United States, although the country accounts for less than a quarter of its total sales.

Any sale of the ophthalmology and respiratory businesses is likely to begin in 2023, after the process for Sandoz is completed, the Bloomberg report said.

Novartis has said that its five main therapeutic areas are cardio-renal care, immunology, neuroscience, oncology and hematology and that it was taking an “opportunistic” development approach in ophthalmology and respiratory care.

The group’s largest ophthalmology product is Lucentis to treat macular degeneration in the elderly, with revenue of 2.16 billion euros last year. Novartis partners with Roche on the medication.

But Lucentis’ revenue is in decline because cheap copies are available. Novartis’ next-generation macular degeneration drug Beovu has not been a commercial success because of concerns over potential side effects.

The Swiss group’s respiratory and allergy sales were $2.1 billion last year, mostly from asthma drug Xolair, where Roche is also a partner.

The two companies are testing Xolair, which is under threat from competing asthma products, as a food allergy treatment.

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Source: Reuters