Novartis

Stock performance

History

Novartis was formed in 1996 through the merger of two historic Basel chemical and pharmaceutical companies, Ciba-Geigy and Sandoz, both with roots stretching back to the nineteenth-century Swiss dye and chemical industry that gradually evolved into pharmaceuticals. The combined company built a broad prescription-medicine portfolio and, notably, retained and expanded Sandoz's generic and biosimilar drug business for many years before spinning it off as an independently listed company in 2023 to sharpen Novartis's focus purely on innovative, patent-protected medicines.

Business model

Novartis researches, develops, and markets prescription pharmaceuticals concentrated in cardiovascular, immunology, neuroscience, and oncology disease areas, following its 2023 spinoff of the Sandoz generics business to focus entirely on higher-margin, patent-protected innovative medicines. Like other major pharmaceutical companies, sustained R&D investment to replace drugs losing patent protection with new approvals is central to maintaining growth.

Market position

Novartis is one of the largest pharmaceutical companies in the world by revenue, competing with fellow Basel neighbor Roche as well as Pfizer, Merck, and AstraZeneca globally. Its 2023 separation from the Sandoz generics business was one of the more significant recent restructurings among major global pharmaceutical companies, aimed at improving its growth and margin profile by shedding lower-margin generic-drug operations.

Country impact

Novartis is one of the largest and most valuable companies in Switzerland and, alongside Roche, anchors Basel's position as one of the world's premier pharmaceutical research hubs. It is a major Swiss employer in research and manufacturing and a significant contributor to the country's pharmaceutical export industry, one of Switzerland's largest economic sectors.