By 1998 Novartis results were disappointing, hurt by below par pharmaceutical sales and the Swiss franc’s appreciation. Moreover, Novartis was losing ground in the U.S., the largest and most profitable pharmaceutical market, while U.S.

Geek Term Papers - News - By 1998 Novartis results were disappointing, hurt by below par pharmaceutical sales and the Swiss franc’s appreciation. Moreover, Novartis was losing ground in the U.S., the largest and most profitable pharmaceutical market, while U.S.

By 1998 Novartis results were disappointing, hurt by below par pharmaceutical sales and the Swiss franc’s appreciation. Moreover, Novartis was losing ground in the U.S., the largest and most profitable pharmaceutical market, while U.S.

competitors were making major gains. With only a few new drugs in the 1999 pipeline, analysts observed that Novartis risked falling further behind U.S. competitors and should consider a large acquisition or merger.

Instead, Novartis doubled down on R&D. As a result of increased investment, the company was able to accelerate a large pipeline of products in late-stage clinical development, many of which came from Ciba’s labs. By the end of 1999, Novartis had 50 projects in clinical development—23 in Phase III clinical trials, 24 in Phase I and II clinical trials, and three in registration.6 Global Pharmaceuticals Head David Epstein noted: “We launched a new drug every 100 days from 2000 to 2003. Most companies are happy to launch one product per year, let alone three or four.”7

Global Bets for a New Century

At the start of the new century, Vasella decided on several strategic initiatives: 1) shift the focus from life sciences to healthcare, 2) invest in businesses not attractive to competitors, 3) globalize research, 4) globalize the investor base; and 5) transform headquarters to reflect the company’s global scope, innovation and care for its associates.

 

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