By Ludwig Burger and Bhanvi Satija
FRANKFURT, Feb 4 (Reuters) - Swiss drugmaker Novartis forecast a worse-than-expected decline in 2026 operating profit by a low single-digit percentage, held back by competition from cheaper copies of established products such as heart drug Entresto.
Novartis is leaning on cancer drugs Kisqali and Scemblix and last year's $30 billion spent on deals, to offset patent expiries, spelling the loss of market exclusivity, on its blockbuster drugs. These include Entresto
for heart failure, allergy treatment Xolair and Cosentyx for autoimmune diseases.
The group's 2026 guidance on Wednesday, which leaves out foreign-exchange effects, included a projection for low single-digit gains in group sales, without mentioning numbers.
That compares with an analyst consensus by Visual Alpha for a revenue gain of about 6.6% to $58.2 billion this year.
Analysts at Jefferies said the lower part of the company's implied 2026 profit guidance range of $21.3-$22 billion, assuming a 1% foreign-exchange tailwind, could spur analysts to trim estimates, which had been at $21.8 billion on average.
Novartis shares fell 1.3% in morning trading to a two-day low.
COMPANY OPTIMISTIC OF HITTING MID-TERM GOALS
CEO Vas Narasimhan, however, was optimistic of hitting mid-term targets, stressing longer-term growth prospects and projecting sales growth this year despite competition from generic drugmakers.
"In 2026, we expect to grow through the largest patent expiry in Novartis history, underscoring the strength of our business, and remain well on track to deliver our mid-term guidance," he said.
Novartis reported a 1% gain in fourth-quarter operating profit, adjusted for special items, on higher sales of breast cancer drug Kisqali, multiple sclerosis drug Kesimpta and psoriasis drug Cosentyx, among others.
Adjusted operating profit was $4.92 billion, in line with analysts' consensus of about $4.9 billion compiled by Visible Alpha.
(Reporting by Ludwig Burger in Frankfurt and Bhanvi Satija in London; Editing by Emelia Sithole-Matarise, Linda Pasquini and Bernadette Baum)
