Novartis (NYSE:NVS) has successfully completed the spin-off of its generic and biosimilar unit, Sandoz, turning it into an independent company. This separation was carried out through a dividend-in-kind distribution to Novartis and American Depositary Receipts (ADRs) holders, with each holder receiving one Sandoz share for every five Novartis shares or one Sandoz ADR for every five Novartis ADRs held at the close of business on October 3, 2023.
The decision to spin off Sandoz into a new publicly traded standalone company was announced by Novartis in 2022 as part of its strategic review.
Sandoz shares have begun trading under the symbol “SDZ” on the SIX Swiss Exchange, while Sandoz ADRs are quoted and traded on OTCQX in the over-the-counter market under the symbol “SDZNY” in the United States.
With the completion of this spin-off, Novartis is now focusing on four core therapeutic areas: Cardiovascular, Renal and Metabolic; Immunology; Neuroscience; and Oncology. The company also has a robust pipeline, with priority given to the United States, China, Germany, and Japan markets.
Novartis is prioritizing three next-generation platforms (Cell & Gene Therapy, Radioligand Therapy, and xRNA), in addition to two established technology platforms (Chemistry and Biotherapeutics), for continued investment in new research and development capabilities and manufacturing scale.
Furthermore, Novartis has reiterated its annual outlook, with expectations of high-single-digit sales growth and low-double-digit to mid-teens growth in core operating income.
The company is also continuing its $15 billion buyback program announced in July 2023 and intends to increase its annual dividend without re-basing it following the Sandoz spin-off.
Novartis shares have gained 9.6% year-to-date, outperforming the industry’s 2.6% growth.
Additionally, Novartis has been streamlining its pharma business by divesting certain assets, such as its “front of eye” ophthalmology assets to Bausch + Lomb (BLCO) for $2.5 billion. This deal includes Xiidra, a treatment for dry eye disease, investigational medicine SAF312 (libvatrep), and other related assets.
Novartis’ strong performance of key drugs, a deep pipeline, and a streamlined focus position the company well for continued success in a competitive pharmaceutical landscape. The recent acquisition of Chinook Therapeutics for $3.5 billion has also bolstered its renal pipeline.
Featured Image: Megapixl
