The transformative restructure comes as the heavyweight pharma plots to spin off its generics unit.
As the pharma giant plans to spin off its generics unit Sandoz, its Chief Executive Officer, Vas Narasimhan, has announced major changes that will see its oncology and pharmaceuticals business merged into one innovative medicines unit. The restructuring, which is expected to result in layoffs, will also see three top executives without jobs. “The simpler organizational model we are unveiling today is central to our growth strategy as it will make us more agile and competitive, enhance patient and customer orientation, unlock significant potential in our R&D pipeline and drive value-creation through operational efficiencies,” said Narasimhan. “With our portfolio of in-market medicines and up to 20 major pipeline assets that could be approved by 2026, Novartis is in a strong position to deliver above-peer-median sales and margin growth in the mid- and long-term.”
The new strategy will also see the United States be elevated as the multinational company looks to gain significant market in the most important pharmaceutical market worldwide. Novartis is also planning on creating a new Strategy & Growth function, that will combine corporate strategy, R&D portfolio strategy and business development. According to a statement released by the company on Monday, the 'function will help drive the company’s growth strategy end-to-end and will look across internal and external opportunities to strengthen Novartis’s pipeline with medicines that are both transformational and can make significant contributions to growth'. The Basel-based pharma expects the operational improvements to result in sales growth of about 4% between 2020 and 2026. These are expected to also result in savings of at least $1 billion by 2024.