Novartis closed both the fourth quarter and the financial year in the new constellation of its continuing operations with solid growth in sales, operating income and profit. Net sales in the fourth quarter amounted to 11.4 billion dollars, an increase of eight percent. The result was characterized by volume increases of 13 percentage points. Generic competition had a negative impact of three percentage points, while the price trend had no effect. The operating result amounted to 2.6 billion dollars, an increase of 47 percent, and was primarily based on higher net sales and lower restructuring costs. These were partially absorbed by higher selling and administrative expenses and research and development investments. Net profit amounted to 2.6 billion dollars. The pharmaceutical company has thus more than doubled its quarterly result compared to the previous year.
For the 2023 financial year, the pharmaceutical company recorded net sales of 45.4 billion dollars, also an increase of eight percent, or even ten percent when adjusted for currency effects. It was characterized by volume increases of 16 percentage points, which were partially absorbed by a price decline of two percentage points and losses due to generic competition of four percentage points. The operating result reached 9.8 billion dollars, 23 percent more than in the previous year. The main reasons for the increase were higher net sales, lower restructuring costs and income from legal matters, partially offset by higher impairment charges, higher selling, general and administrative expenses and higher research and development investments. Novartis reported net income of 8.6 billion dollars. This is an increase of 42 percent compared to the previous year and was mainly due to higher operating income and one-time favorable tax effects.
Commenting on the 2023 results, Vas Narasimhan, CEO of Novartis, said: "“Novartis completed its strategic transformation into a pure-play innovative medicines company and continued its relentless pursuit of sustainable shareholder value creation. Our robust operational performance continues, with strong double-digit top and bottom-line growth, for the quarter and full year. We delivered ten positive Ph3 readouts on assets with significant sales potential, over the past year. The very strong performance of our key growth drivers and pipeline underscores the confidence in our growth and margin mid-term guidance.”
Novartis has completed its transformation into a pure-play innovative medicines company in 2023. The focus is clearly on four core therapeutic areas: cardiovascular, renal and metabolic diseases; immunology; neurology; oncology. In each of these areas, the company has several important drugs on the market and product candidates in the pipeline that address a high disease burden and show great growth potential. In addition to two established technology platforms, Chemistry and Biotherapeutics, three new platforms for gene and cell therapy, radioligand therapy and xRNA will be prioritized for further investment in new research, development and manufacturing capacity. Geographically, the company is focusing on growth in its key markets of the USA, China, Germany and Japan.