Novartis warns of pandemic delay in cancer diagnoses
Novartis has warned of a worrying delay in cancer diagnoses due to the Covid-19 pandemic, as the Swiss drugmaker missed expectations in the first quarter.
Vas Narasimhan, Novartis chief executive, said there was still a backlog of delayed diagnoses, particularly in breast cancer, even though demand in many other areas of healthcare was returning to normal levels.
Diagnoses have fallen as healthcare systems are stretched by Covid-19 and some patients are reluctant to visit doctors for screenings.
“The most concerning is that patients are getting diagnosed later in their cancers,” said Narasimhan. “In general, it’s harder for the industry’s medicines and interventions to help patients when they are diagnosed later.”
Novartis missed earnings and sales expectations as the pandemic hit demand for drugs for breast cancer, skin and eye conditions.
It forecast net sales to grow in the low to mid single-digit percentage points this year, with core operating income expected to increase slightly more, in the mid-single digits.
The guidance assumes healthcare systems return to normal prescription dynamics by mid-2021. Narasimhan said that apart from in cancer, demand for healthcare had already returned to normal levels in the US and China, and has been recovering in Europe in the past two months.
He added the soaring case levels in other parts of Asia and in Latin America would have an impact on their healthcare systems but not on Novartis’s business.
Narasimhan said Novartis was supporting hospitals in India and Brazil with its Covid-19 response fund.
“It is of immense concern for me personally but also professionally for the company, the challenges that India is seeing, but also what we’ve seen in Brazil,” he said.
Novartis is supporting other pharmaceutical companies with the production of vaccines, including CureVac, and manufacturing a key component and filling vials for the BioNTech/Pfizer shots.
Narasimhan said the company received a “small contribution for our efforts”, on top of costs but that it was “not a significant financial driver”.
Net sales at the Swiss pharmaceuticals company fell 2 per cent year on year on a constant currency basis to $12.4bn, just short of the average analyst estimate for $12.51bn.
Cough medicine sales at Novartis’s Sandoz unit were also hit by a “historically weak” cold season because of social-distancing measures.
Novartis reported core earnings per share of $1.52, missing the consensus forecast of $1.59. The company faced weaker comparisons with the first quarter of 2020, when it benefited from a stockpiling of drugs ahead of lockdowns.
Operating income fell 14 per cent on a constant currency basis, to $2.4bn.