Novartis raises core profit guidance, books $1.9 billion hit from drug trial setback
NVS•Novartis raised its full-year core operating income growth forecast to a low single-digit percentage from a previously expected low single-digit decline, while booking a $1.9 billion partial impairment charge tied to a drug trial setback. It maintained its forecast for low single-digit net sales growth.
1. Guidance raised
Novartis now expects full-year core operating income to grow by a low single-digit percentage, compared with its previous forecast for a low single-digit decline. The company maintained its forecast for low single-digit net sales growth.
2. Trial setback charge
Third-quarter core operating income rose 10% at constant exchange rates, while reported operating income fell 61%. Novartis attributed the decline to higher research and development costs and a $1.9 billion partial impairment charge for del-desiran, which was being tested for myotonic dystrophy. The drug was obtained through Novartis' $12 billion acquisition of Avidity.
