Novartis Raises Guidance Despite Drug-Trial Setbacks Hitting Profit — Update

By Adria Calatayud

Novartis raised its full-year earnings guidance, citing solid sales growth and productivity gains, even as recent clinical-trial setbacks hit the Swiss drugmaker's bottom line in the third quarter.

The company has been grappling with declining revenue from aging medicines that used to rank among its top sellers, such as heart drug Entresto, as it works to roll out new products and to advance studies to seek approval for more.

Two medicines that the company hoped would boost its midterm outlook--pelacarsen for cholesterol and del-desiran for a rare neuromuscular disorder--missed their goals in late-stage trials, while a third, remibrutinib, hit the target in multiple sclerosis.

Novartis Chief Executive Officer Vas Narasimhan told reporters on Tuesday that the positive study results for remibrutinib, when added to existing skin indications for which it is already approved and more that could be unlocked by trials currently under way, mean it could become the largest medicine in the company's history.

Meanwhile, continued growth from existing medicines and label expansions for recently launched products underscored the company's ability to replace sales lost to lower-priced generic competitors, he said.

Novartis said it now expects 2026 core operating profit to rise by a low-single-digit percentage when excluding the effect of currency changes. It had previously projected a decline for the metric.

Narasimhan said Novartis remained committed to its experimental drug del-desiran after a trial for myotonic dystrophy type 1 didn't deliver the results the company hoped for, and that it was working through the development path for the medicine.

Novartis acquired del-desiran as part of its $12 billion deal for Avidity Biosciences. The trial setback led the company to book a $1.9 billion write-down in its third-quarter results.

As a result, Novartis reported a drop in third-quarter net profit to $1.20 billion from $3.93 billion for the same period last year.

Excluding exceptional items, core operating profit climbed 10% at constant currency to $6.04 billion. The result beat analysts' expectations of $5.61 billion, according to consensus estimates provided by Visible Alpha.

Novartis's quarterly sales rose 4% to $14.52 billion.

Full-year sales are still expected to grow by a low-single-digit percentage, excluding currency effects, Novartis added.

Write to Adria Calatayud at adria.calatayud@wsj.com

(END) Dow Jones Newswires

October 27, 2026 05:07 ET (09:07 GMT)