Novartis Q2 Sales of $14.4B Beat Expectations as Innovative Drugs Offset Patent Cliff Impact
Alina Collins
Novartis posted Q2 sales of $14.4 billion, topping consensus by nearly $400 million, with core operating profit 11% above estimates; six newer drugs are collectively outrunning the revenue cliff from expiring patents on legacy blockbusters.
How big was the beat?
Sales reached $14.408 billion, up 3% year-on-year and $400 million above the analyst consensus of $14.042 billion.
Core operating profit came in at $5.94 billion, versus the Street's $5.34 billion → the extra $600 million was driven almost entirely by newer, higher-margin drugs.
Core EPS of $2.41 beat the expected $2.13. This means → the profit beat (13%) far exceeded the revenue beat (3%), signaling that the new portfolio is not just selling more — it is selling at better margins.
Which new drugs are carrying the load?
Kisqali — a CDK4/6 inhibitor for breast cancer — posted $1.695 billion, up 44% year-on-year, making it the quarter's top seller.
Kesimpta, a B-cell therapy for multiple sclerosis, grew 32% to $1.424 billion; Pluvicto — a radioligand therapy that uses radioactive molecules to target and kill tumor cells — grew 43% to $651 million.
Scemblix, a next-generation leukemia drug, surged 89% to $562 million; cholesterol-lowering RNA drug Leqvio grew 61% to $480 million; newly launched skin-disease pill Rhapsido booked $64 million, ahead of expectations.
In plain terms = six drugs collectively delivered over $5 billion in revenue, every one growing above 30% — that is the evidence behind Novartis's claim that innovation can replace what patents take away.
How bad is the patent-cliff damage?
Entresto, once the flagship heart-failure drug, saw sales collapse 50% year-on-year as generics entered the market.
Tasigna (leukemia) fell 57%; Promacta (low platelet counts) fell 64% — three legacy products losing ground simultaneously, the single biggest drag on the quarter.
This means → Novartis is living through two opposing forces at once: new drugs climbing fast, old drugs falling off a cliff. This quarter's result shows the climb is, for now, outpacing the fall.
Some analysts believe the previous quarter may have marked peak patent-cliff pressure, with headwinds set to ease from here.
What did $15 billion in deals buy?
Over the past year CEO Vas Narasimhan announced acquisitions totaling more than $15 billion, headlined by a $12 billion deal for Avidity Biosciences and its RNA drug pipeline.
Smaller deals added Tourmaline Bio (cardiac inflammation therapies), Synnovation Therapeutics (experimental drugs targeting cancer-driving proteins), and most recently Myricx Bio (early-stage cancer candidates).
This reflects Novartis's strategic logic: fill the next-generation pipeline through M&A before legacy patents expire, so new revenue sources are ready in three to five years.
Where is the capacity bet going?
Novartis has committed to building seven new manufacturing facilities in the U.S. as part of a $23 billion domestic expansion plan, focused on radioligand therapy (RLT).
Novartis is the only company worldwide with two approved RLT drugs — Pluvicto and Lutathera. In plain terms = competitors are still running clinical trials; Novartis is already building factories to mass-produce.
Key clinical readouts from experimental therapies are expected in the coming quarters, including Del-desiran from the Avidity pipeline — a drug targeting the genetic cause of muscle diseases. Whether these programs deliver on schedule will be the market's main test of whether Novartis's old-to-new transition is truly complete.
Content is for reference only, not financial advice.