CEO Jim Jimenez at Novartis is stepping down February 1 and handing over the reins to the Switzerland-based pharmaceutical giant to Vas Narasimhan the company’s chief of drug development. He will be tasked with the fate of $50 billion of assets and make good in the pledge to return the company to growth in sales.
Jimenez, who when he steps down will have eight years at the top spot at Novartis, has moved from vaccines, animal health, and over the counter drugs at Novartis, to focus on prescription medicines, that in general are more profitable, particularly those for cancer.
However, sales were hit as its top-selling drugs such as Gleevac a treatment for blood cancer lost patent protection, while Alcon it eye business lagged its expectations and Sandoz its generics arm faced huge pressure on its prices in the U.S.
Novartis was given a boost last week, after the U.S. approved its Kymriah treatment of $475,000 per patient for younger people with acute lymphoblastic b-cell leukemia. The treatment is one in a series of new drugs Novartis expects to help revive its sales growth beginning in 2018.
On Monday, Jimenez said now was the right time for him to move on. He said he believes a leader needs to be in place at the start of a growth phase and then see it through.
Narasimhan, who is 41, is amongst the new generation of young leaders with Novartis, including Jay Brander the head researcher.
Together, the two have sought to improve the way of moving the company’s drugs from their lab to commercial products, something both acknowledge had not worked efficiently all the time in the past.
Narasimhan, who is a U.S. citizen, said that would continue to be their focus of translating innovation into successes commercially.
Analysts have said that Narasimhan’s skills as a medical doctor trained at Harvard and a former consultant with McKinsey might be the blend that Novartis has needed to balance the company’s research with its business side.
Plenty will be on the agenda for Narasimhan to do. His appointment has come at a time when Novartis is reviewing Alcon for a potential sale that might bring in between $25 billion and $35 billion.
He also must decide what needs to be done with its stake of $10 billion in its drugs venture that is over the counter with GlaxoSmithKline.
The Swiss-based business faces a March 2018 deadline to decide if it will exercise its sell option for its stake of 36.5%.