|
 Jimenez, who will have been at the helm for eight years when he
retires, has hived off animal health, vaccines and over-the-counter
drugs businesses at Novartis to focus on generally more profitable
prescription medicines, particularly in cancer.
But sales have been hit as top-selling drugs such as blood cancer
treatment Gleevec have lost patent protection, while eye business
Alcon has lagged expectations and generics arm Sandoz has faced
intense pressure on prices in the United States.
Novartis got a boost last week, when the United States approved its
$475,000-per-patient Kymriah treatment for young people with B-cell
acute lymphoblastic leukemia, one of a series of new drugs it
expects to revive sales growth starting next year.
Jimenez, 57, said on Monday now was a good time to move on.
"I really believe a leader has to be in place at the beginning of
that growth phase to see it through," he told reporters on a call.
"And that wouldn't be me, given that I'm already eight years into my
tenure."
Narasimhan, 41, is among a new generation of youthful leaders at
Novartis, including head researcher Jay Bradner at the Novartis
Institutes For Biomedical Research.
Together, they have sought to improve the company's way of moving
drugs from the laboratory into commercial products, something they
acknowledge has not always worked efficiently.
"That's going to continue to be the focus of the company: To
translate that innovation into commercial success," said Narasimhan,
a U.S. citizen.
Analysts said Narasimhan's skills as a Harvard-trained medical
doctor and former McKinsey consultant may be the blend Novartis
needs to balance research and business.
"The appointment ... brings deep medical and commercial knowledge
plus strong communication, and we expect this fresh start to be
taken very well by the markets," said David Evans, a Kepler
Cheuvreux analyst.
DECISIONS
But there will be plenty in Narasimhan's in-tray.
His appointment comes as Novartis is reviewing Alcon for a possible
sale that could bring in $25-$35 billion.
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He must also decide what to do with its $10 billion stake in its
over-the-counter (OTC) drugs venture with GlaxoSmithKline. Novartis
faces a deadline of March 2018 to decide whether to exercise a sell
option for its 36.5 percent stake.
Narasimhan will have to weigh up too what to so with Novartis's $14
billion stake in cross-town rival Roche, which the company has said
could be sold.
Novartis shares have lagged the Stoxx European Health Care Index by
around 9 percent during Jimenez's tenure. At 1025 GMT, they were
down 0.9 percent at 80.10 Swiss francs.
Having held various roles at Novartis since 2005, Narasimhan became
global head of drug development and chief medical officer in 2016.
Jimenez said his departure would not affect a strategic review of
Alcon, with an update due by year's end.
"We're going to consider all options ranging from keeping the
business up to a capital markets exit," he said. "There really is no
change, so don't read anything into it."
He also hailed last week's U.S. approval of Kymriah, the first
so-called CAR-T therapy to win the U.S. Food and Drug
Administration's blessing.
"We started this five years ago, it was a big bet, a lot of people
thought we were crazy and it's paying off," Jimenez said. "We have
big plans."
(Reporting by John Miller; Editing by Muralikumar Anantharaman and
Mark Potter)
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