Novartis Expects Operating Profit to Fall in 2026 Amid Entresto Competition

Swiss pharma giant Novartis anticipates a slight operating profit decline throughout 2026. This projection stems from rising competition for its older, established medications. Specifically, cheaper generic copies of the heart drug Entresto now threaten revenue streams.

Despite this cautious forecast, the company celebrated a stable fourth-quarter performance recently. Adjusted operating profit grew by 1% during the final months of last year. Strong sales of newer treatments drove this growth across several global markets. Patients increasingly rely on the breast cancer therapy Kisqali and the multiple sclerosis drug Kesimpta. Furthermore, the psoriasis treatment Cosentyx continues to perform well in a crowded market.

Quarterly earnings reached $4.92 billion, which precisely matched analyst expectations for the period. Investors monitored these figures closely as the firm navigates a challenging patent landscape. Consequently, the company is pivoting toward a fresh portfolio of high-growth cancer medicines. It currently places heavy bets on drugs like Scemblix to offset upcoming losses.

Last year, the firm executed a massive $30 billion acquisition and licensing strategy. This aggressive expansion aims to bridge the gap left by expiring product patents. Blockbuster drugs like the allergy shot Xolair will soon face intense market pressure. Therefore, management is working tirelessly to refresh their clinical pipeline with innovative therapies.

Transitioning from old staples to new breakthroughs requires significant capital and strategic patience. However, the recent quarterly success suggests that their newer launches possess strong momentum. Industry experts believe these “growth engines” are essential for long-term financial stability.

The company remains focused on specialized medicine to maintain its competitive edge globally. Although 2026 looks lean, the long-term outlook depends on these strategic investments. Novartis continues to streamline its operations to maximize efficiency during this transition. This proactive approach helps the firm absorb the impact of the “patent cliff.”