Sandoz will no longer be part of Novartis. On October 4, the first European manufacturer of generics and biosimilars was listed for the first time on the SIX Swiss Exchange (SIX). Richard Saynor, CEO of Sandoz, was optimistic during the opening: “As an independent company we are fully capable of delivering a strategy that aims for sustainable leadership in the growing and critical sector of off-patent medicines.” The shares went public with a value of 24 Swiss francs, adding a market capitalization of just over 11,000 million euros. On Friday the value exceeded 27.6 francs, which represents an increase of 15%.
Sandoz has a portfolio of more than 1,500 medicines globally in more than 100 countries. It is the largest European producer of generics of standard drugs, biosimilars and versions and in the first half of this year, still under the umbrella of Novartis, it achieved net sales of 4.6 billion euros, with a year-on-year increase of 5%.
To maintain its leadership and be competitive against Asian groups, Sandoz has announced an investment of more than 380 million euros in a new European production plant in Slovenia, 95 million euros in improving internal development capabilities and a partnership strategic manufacturing with Just-Evotec.
Sandoz until now represented a fifth of Novartis' business: in 2022 it had a turnover of 9,164 million euros of the 50,300 million euros of the Swiss laboratory.
The group announced the split in August 2022, which has now materialized. “For Novartis, the separation of Sandoz would further support our strategy of building an innovative medicines company,” Novartis CEO Vas Narasimhan acknowledged in a press release. The Swiss pharmaceutical company wants to focus on its core innovation business, which is based on four main therapeutic areas: cardio renal metabolic (CRM), immunology, neuroscience and oncology, particularly in the geographical areas where it is strongest: USA, China, Germany and Japan.
Their decision joins that of other companies that have also opted to dispense with their non-strategic businesses, such as the American Pfizer or the British GSK. Generic drugs, with very low prices after going off patent and with many manufacturers, are often sold with low profit margins.
Vas Narasimhan, however, highlighted the good prospects of the new Sandoz: “With several consecutive quarters of sales growth, Sandoz starts from a solid position as a world leader in generics and biosimilars.”
In the Peninsula, Sandoz Iberia has nearly 800 employees, of the total of 22,000 that the company has worldwide.
In Spain, Sandoz plans an investment of 50 million euros until 2025 in the expansion of the plant in Palafolls (Barcelona). Already announced in 2021, “this is part of the investment of more than 250 million euros in the antibiotic production network and will mean an increase of more than 150% in the plant's production capacity, which will go from 200 to 500 tons annually,” explains Gracia Espuelas, head of Institutional Relations for the group in Spain.
At the same time, the group closes the plant in Les Franqueses del Vallès (Barcelona), where it produces amoxicillin through chemical synthesis, a technology that it considers uncompetitive. The closure will affect 160 employees: 40% of the staff will be relocated to Palafolls and the other 60% will benefit from retirement and early retirement, in an agreement that has already been closed with workers and unions.
The group will also grow in Madrid, with new investments in its seven global centers of excellence and the creation of 150 new jobs.
Sandoz managers are optimistic about this new era. “The spin-off is a unique opportunity. We are a new Sandoz with a century-old legacy and a firm purpose that has not changed: to be pioneers in facilitating access to health for patients, maintaining ourselves as the world's leading generic and biosimilar company, and with the aspiration of being the best valued”, concludes Gracia Espuelas.
