Generics subsidiary – Novartis separates from Sandoz – News

  • The Basel pharmaceutical company Novartis separates from Sandoz.
  • The generics manufacturer is to become an independent company.
  • The company’s headquarters will remain in Switzerland.

According to Novartis, the transaction should be completed in the first half of 2023. The new company is to be listed on the Swiss stock exchange.

Sandoz includes Novartis’ biosimilars and over-the-counter medicines business. Novartis announced in October 2021 that it would review all options for Sandoz. The group had given itself a deadline of the end of 2022 for this.

Novartis wants to sharpen focus

This review has now shown that a spin-off from Sandoz through a 100% spin-off is in the best interests of the shareholders, according to the Novartis report.

This will create the largest European generics company and a leading global supplier of biosimilars. Novartis, in turn, will become a more focused company as a result. Generics are imitation products of medicines with the same active ingredient whose patent protection has expired and which are often cheaper than the first-party products.

Sandoz generated sales of $9.6 billion last year, almost a fifth of total Novartis sales. The company operates in more than 100 markets worldwide. The previous CEO, Richard Saynor, will also lead the future company.

Novartis does not part with historical heritage


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It is now clear what will happen next with Sandoz: The generics manufacturer is to go public as an independent company. For a long time, an IPO was considered unlikely because the generics market is considered difficult due to its low margins. But the climate on the financial markets has changed in recent weeks: the Ukraine war and horrendous inflation are making companies more cautious when it comes to making large acquisitions and borrowing money for them.

With the spin-off, Novartis is separating from a division, but not from its historical legacy, as the group has always emphasized. Because: After the merger of Sandoz and Ciba-Geigy in 1996, the group bundled only the less important generics under the well-known brand name Sandoz. The spirit of innovation – the economic interest – lives on in the larger pharmaceutical division and thus in the focused Novartis group. (Assessment by SRF business editor Lucia Theiler)

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