Novartis Seeks Productivity Improvements with New CFO
Novartis has promoted Harry Kirsch, who has driven productivity improvements at its pharmaceuticals division, to be chief financial officer as the Swiss drugmaker looks to grow beyond a wave of patent expiries.
The surprise announcement is the second leadership change in as many quarters after Chairman Daniel Vasella stepped down in February after 17 years leading the group.
Novartis expects 2013 to be a year of transition as it bears the full brunt of last year's patent loss on its blockbuster blood pressure drug Diovan. It is counting on sales of new products, like cancer drug Afinitor, to fill the gap.
Kirsch, 48, is currently chief financial officer (CFO) of Novartis' pharmaceuticals division, which posted flat net sales in the first quarter as new products such as multiple sclerosis treatment Gilenya, up 71%, and Afinitor, up 114%, helped offset declining Diovan sales.
Novartis said on Wednesday that Kirsch, who joined Novartis ten years ago having worked as CFO at Proctor & Gamble's pharmaceutical business, had been "recognised for his ability to improve productivity."
"(Kirsch's) deep knowledge of Novartis pharmaceuticals operations and his productivity focus will now benefit the full portfolio," said Chief Executive Joseph Jimenez in a statement.
Jon Symonds, CFO for the past four years, will serve as adviser to the CEO until the end of the year, Novartis said.
First-quarter core earnings per share rose 6% to $1.32, compared with the average estimate of $1.30 in a Reuters poll of analysts, while net sales rose 2% to $14.016 billon.
The Basel-based group has forecast a mid-single digit decline in its core operating margin on a constant currency basis in 2013, as it expects competition from copycat drugs to knock up to $3.5 billion off sales.
