Pharmaceutical company Novartis AG invested $9.996 billion in Research and Development in 2022, an increase of 4.8% year-on-year.
In April 2022, the company announced the introduction of a new organizational model designed to support the company’s innovation, growth and productivity ambitions as a focused drug company.
The restructuring will simplify the organization and its processes, and is expected to generate $1.5 billion in savings by 2024, a portion of which has already been achieved in 2022, enabling Novartis to increase its long-term core operating income margin forecast.
The company expects these savings to help it progress toward its aspiration to achieve a core margin of more than 40% beyond 2027 and to continue to invest in its pipeline as a pure drug company (following the planned spin-off of Sandoz, which is subject to approval by the Novartis AG Board of Directors and shareholders).
However, there was an immediate impact on operating income as the company incorporated related costs in the latter part of the year, which, together with higher legal settlements and unfavorable fair market value adjustments to financial assets, affected operating income growth.
In 2022, Novartis was still delivering high-value medicines to patients. The company received 23 approvals in its key markets: the United States, the European Union, China and Japan, including for Pluvicto, a new radioligand treatment for advanced prostate cancer, in the United States and the European Union.
The company advanced its pipeline of investigational drugs, with several important clinical data paving the way for new launches in 2023 and beyond, including iptacopan, its investigational monotherapy for the treatment of paroxysmal nocturnal hemoglobinuria (PNH).
However, the company also had disappointments, as some clinical trials of experimental compounds failed to meet its primary endpoints, such as ACZ885 (canakinumab) in lung cancer, and UNR844 in presbyopia.
In 2022, the company began integrating Advanced Accelerator Applications (AAA), a Novartis company focused on radioligand therapies, into its existing manufacturing and supply structure.
Novartis manufactures its products through the following technologies in facilities around the world: large molecule, small molecule, cell and gene therapy, RNA therapy and radioligand therapy.