Net profit increase in Novartis
It is reported that Novartis AG gained a 1% increase of net profit in the third-quarter this year. As a drug maker, Novartis has benefit from increased sales from its pharmaceuticals division. According to figures released by Novartis, the profit of this third-quarter reached $2.1 billion, compared to $2 billion in the same period in 2008.
What’s more, the net sales of the third quarter were $11.1 billion. Compared to $10.7 billion in the same quarter of the last year, there was a 3% increase. And this increase had been offset by the weakness of dollar in the currency markets. Without this effect, the actually increase could reach 7%.
In fact, increases in both net sales and net profit mainly came from the great performance of Novartis’s pharmaceuticals business. According to estimation made by the company, there are about 90 million to 120 million doses of swine flu vaccine that will be produced by the end of the year.
The huge production of swine flu vaccine is expected to bring an extra of around $400 million to $700 million to the net sales in the fourth quarter. Actually this significant benefit was triggered by the approval in the US and Europe for Novartis’ swine flu vaccine.
This approval was only one of the key approvals of the company in 2009. According to Chief Executive Daniel Vasella, the firm’s great investments in R&D had shown excellent results, especially the anti-cancer therapy Afinitor and the biotechnology medicine Ilaris.
However, there were still negative signs underlying the encouraging profit. An eye care company Alcon under Novartis actually greatly offset the overall profits of the firm. Alcon conducted a research and development project in this year. In addition, Novartis also suffered increased financing costs and a higher tax rate.