Novartis raises FY guidance as Q3 core operating income rises 10%

Novartis lifted its full-year core operating income guidance after Q3 net sales grew 4% in constant currencies, driven by double-digit gains across five

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Novartis posted third-quarter net sales of USD 14.5 billion, up 4% in constant currencies (cc), and raised its full-year guidance for core operating income from an expected decline to growth in the low single digits. Core operating income for the quarter reached USD 6.0 billion, up 10% cc, with the core operating income margin expanding 2 percentage points to 41.6% of net sales.

The strong top-line performance was driven by a cluster of high-growth brands. Scemblix, the BCR-ABL inhibitor used in chronic myeloid leukaemia, grew 67% cc to USD 593 million. Leqvio, the RNA-interference cholesterol-lowering therapy developed with Alnylam, grew 63% cc to USD 506 million, benefiting from inclusion on China's national reimbursement drug list. Kisqali, the CDK4/6 inhibitor for breast cancer, added 37% cc to reach USD 1.8 billion, while Kesimpta for multiple sclerosis grew 22% cc to USD 1.5 billion.

On a reported basis, operating income fell sharply, down 59% to USD 1.8 billion, principally because of a USD 1.9 billion partial impairment of the del-desiran in-process research and development asset. Del-desiran, an investigational RNA-targeting therapy for myotonic dystrophy type 1 (DM1), failed to meet its primary endpoint in the Phase III HARBOR study. Novartis said it observed evidence of clinical activity in secondary and exploratory analyses and will engage with regulators on the next step.

Pipeline developments

The quarter also brought substantive news from across the pipeline. Remibrutinib, a BTK inhibitor, met its primary endpoint in the Phase III REMODEL-1 and REMODEL-2 trials in relapsing multiple sclerosis, significantly reducing annualised relapse rate versus teriflunomide and showing superiority on all key secondary endpoints including MRI lesion reduction. Novartis described the safety profile as favourable and free from the liver signals that complicated earlier BTK inhibitors in MS.

Pluvicto, the radioligand therapy for prostate cancer, received approvals in the US and China for earlier-stage metastatic hormone-sensitive disease, extending its approved footprint across all stages of PSMA-positive metastatic prostate cancer. Rhapsido gained a new FDA approval in symptomatic dermographism, while pelabresib was submitted to the European Medicines Agency for myelofibrosis and del-zota received FDA priority review for Duchenne muscular dystrophy affecting exon 44.

The quarter ended with a setback for pelacarsen: the Lp(a)-lowering antisense therapy did not reduce cardiovascular events in the Phase III HORIZON trial despite demonstrating Lp(a) reduction, a result that raises questions about whether Lp(a) lowering alone is sufficient to alter hard cardiovascular outcomes at the patient population level studied.

Market context and competitive read-across

Novartis is one of several large-cap pharmaceutical groups repositioning around high-science modalities. Its radioligand therapy franchise, which includes both Pluvicto and Lutathera, is a differentiating asset in a field that remains thinly populated. Bristol Myers Squibb and Bayer have advanced RLT programmes, but Novartis currently leads in commercial approvals.

The BTK inhibitor landscape in multiple sclerosis is crowded at Phase III, with Sanofi's tolebrutinib, Merck KGaA's evobrutinib and AbbVie's fenebrutinib all in late development. Positive Phase III data for remibrutinib in RMS will be viewed as a significant differentiator, particularly given the clean safety profile reported; liver toxicity concerns have constrained competitors in this class.

Chief executive Vas Narasimhan said the company remained "well on track to deliver our mid- and long-term outlook", citing the replacement power of priority launches against ongoing generic erosion, notably on Entresto, which fell 38% cc following patent expiry.

Novartis will report full-year results on 3 February 2027. A management meeting for investors is scheduled in London on 18 and 19 November 2026.

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