Novartis NVS announced that it has increased its sales guidance for the mid-term. The company now expects total sales to witness a compound annual growth rate (CAGR) of 6% during 2023-2028 compared with the previous estimate of 5%.

The rise in guidance was due to the strong momentum of NVS’ key drugs and its upcoming launches.

Shares of Novartis have risen 4% year to date compared with the industry’s growth of 4.8%.

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NVS Raises Mid-Term Outlook

For 2024-2029, sales are expected to witness a CAGR of 5%. NVS stated that it remains on track to deliver core operating income margin of 40%+ by 2027, benefiting from continued strong sales growth and productivity improvements.

The rise in the mid-term outlook was driven by an increase in peak sales estimates for Cosentyx, Kisqali, Kesimpta, Pluvicto and Leqvio.

NVS expects strong momentum in its business with eight key drugs anticipated to generate $3-$8 billion in peak sales. The company projects 15 submission-enabling readouts in the coming years to further bolster its growth profile.

In the long term, NVS has identified more than 30 assets in the pipeline to support mid-single-digit growth after 2029.

NVS Acquires Kate Therapeutics

While organic growth continues to drive business, NVS is also focused on strategic bolt-in acquisitions to strengthen its pipeline.

Novartis has acquired Kate Therapeutics to strengthen its portflio of gene therapies.  Per the terms of the agreement, Kate Therapeutics’ shareholders are entitled to receive up to $1.1 billion, comprising a cash payment that was paid at the closing of the transaction and additional amounts payable on achievement of specified milestones.

Kate Therapeutics is a San Diego-based, preclinical-stage biotechnology company focused on developing adeno-associated virus (AAV)- based gene therapies to treat genetically defined neuromuscular diseases. The primary programs include preclinical candidates for Duchenne muscular dystrophy, facioscapulohumeral dystrophy and myotonic dystrophy type 1.

NVS Collaborates With Ratio Therapeutics

Novartis also entered into an exclusive worldwide license and collaboration agreement with Ratio Therapeutics Inc. for a next-generation SSTR2-targeting radiotherapeutic candidate, which adds to the company’s deep radioligand therapy pipeline.

Ratio will collaborate with Novartis to drive preclinical activities to research and select an SSTR2-targeting development candidate. On the other hand, Novartis will assume responsibility for all remaining development, manufacturing and commercialization activities.