ZURICH • Novartis' struggling Alcon eye care division will take longer to turn around than expected, the Swiss drugmaker's chief executive Joe Jimenez warned yesterday as he reported a smaller-than-forecast fall in third-quarter net income.
Alcon's sales this quarter will be "flat to down slightly", Mr Jimenez said, after predicting earlier this year that the division's new head Michael Ball would have it growing at a low-single-digit percentage rate by the year end.
Novartis has blamed a failure to innovate and inconsistent customer service for the problems at Alcon, a business which the company gradually bought from food maker Nestle in deals totalling US$51 billion (S$71 billion), but could eventually sell.
Mr Ball, hired to run Alcon in January, has seen the contact lens business improve, but intraocular lens and cataract equipment revenue is still lagging.
"It's probably going to be flat to down slightly, but it will be improved growth momentum going into 2017," Mr Jimenez said of Alcon.
Novartis said its net income fell 4 per cent to US$2.938 billion, while sales slipped 1 per cent to US$12.1 billion.
Analyst Timothy Anderson said in a note: "Investors will continue to ask where the green shoots of recovery will emerge." Novartis' main pharmaceuticals business got some help from Gleevec. Mr Jimenez now predicts Novartis' combined hit from generic rivals this year will be less than US$3 billion, lower than previously forecast.
Cosentyx is helping to offset Gleevec's decline, with Novartis predicting its new psoriasis drug would hit "blockbuster" status of US$1 billion this year.
Mr Jimenez is also "constantly scanning for bolt-ons" of US$2 billion to slightly more than US$5 billion to boost his pipeline or expand geographic reach.
Acquisition timing is playing a role as Novartis mulls over the sale of its 13 billion Swiss franc (S$18.1 billion) stake in rival Roche.