Novartis returns to growth in Q2 as new cancer drugs offset 50% Entresto slump
Newer drugs Kisqali and Pluvicto drove a 36% revenue surge to nearly $7 billion, helping the Swiss pharma group post $14.4 billion in sales and stable core profit of $5.94 billion.
Entresto under pressure
The loss of U.S. market exclusivity for Entresto, Novartis's top-selling heart failure drug, drove a sharp revenue decline. In the second quarter, Entresto sales tumbled 50 percent to $1.18 billion, after a 42 percent drop in the first three months of the year. The medicine had generated $7.7 billion in 2025, representing 14 percent of the group's net sales. The patent cliff also affected other former blockbusters: Promacta, Tasigna, and four additional drugs among the top 20 by revenue suffered double-digit percentage declines.
New drugs power recovery
A cohort of eight newer medicines, spearheaded by the cancer therapies Kisqali (breast cancer) and Pluvicto (prostate cancer), more than compensated for the generic erosion. Combined revenue from these growth drivers surged 36 percent to nearly $7 billion in the second quarter. The strong performance allowed the Basel-based pharmaceutical group to return to top-line growth after a first-quarter contraction caused by the initial wave of generic launches. The company has been skilfully rejuvenating its portfolio, shifting toward innovative oncology and specialty medicines.
Financial results
Group revenue reached $14.4 billion, an increase of 3 percent in U.S. dollar terms and 1 percent in constant currencies. The result exceeded the average analyst estimate by more than 3 percent. Core operating profit, the key metric for investors, was stable at $5.94 billion, comfortably above the AWP consensus of $5.3 billion. Net profit fell to $3.3 billion from $4.0 billion a year earlier, primarily due to higher tax charges and increased interest expenses.
- Patents expire for Entresto, Promacta, and Tasigna
- Entresto sales drop 42%; group revenue declines
- Revenue returns to growth (+1% cc); new cancer drugs surge 36%
- Management expects generic impact to ease, guides low single-digit revenue growth
Management's view and stock reaction
CEO Vas Narasimhan had previously signalled that the negative impact from generics would be significantly stronger in the first half of 2026 than in the second. Novartis has repeatedly stated that the erosion from copycat medicines likely peaked in the first half. The company left its full-year guidance unchanged: low single-digit revenue growth in constant currencies, with core operating profit expected to decline by a similar low single-digit percentage. Despite the better-than-expected quarter, management did not raise the outlook, a decision that some analysts had hoped for. Investors nonetheless rewarded the stock: Novartis shares have climbed 17 percent since the start of the year to almost CHF 127, making it the most expensive European pharmaceutical stock by valuation. Over five years, the shares have gained 58 percent, while Roche stock has lost 4 percent over the same period.
