Shares of Swiss drug maker Novartis AG (NYSE: NVS) surged as much as 5% on Thursday after the Company reported better-than-expected second quarter earnings and sales. Novartis posted earnings of USD 1.34 per share, ahead of USD 1.20 estimated by Wall Street. Revenues grew 4% year over year to USD 11.8 Billion, topping projections of USD 11.7 Billion.
The pharmaceutical company is divided into two segments- Innovative Medicines and Sandoz, or generics. Novartis’ Innovative Medicines business delivered net sales of USD 9.3 Billion for the quarter as Pharmaceuticals sales grew 10% and Oncology grew 9% on a constant-currency basis. The Company said gains were partly offset by generic competition. Sandoz net sales declined 1% to USD 2.4 Billion as price erosion in the U.S. offset a 10% rise in volume growth.
“We had another outstanding quarter from an innovation perspective, from an operating performance, and financial performance perspective,” said CEO Vasant Narasimhan. Company recorded a few innovation highlights this quarter. In May, the Food and Drug Administration approved Novartis’ gene therapy treatment, Zolgensma, for spinal muscular atrophy. The same day, the drug maker gained approval for its breast cancer treatment, Piqray.
For fiscal 2019, Novartis expects revenues to grow mid to high-single on a constant currency basis, up from previous guidance of mid-single digit. The Company said its Innovative Medicines segment should grow mid to-high-single digit while its Sandoz business is expected to remain flat to up low single digit.
Novartis’ stock price has climbed nearly 24% this year versus competitors like Bayer AG (OTC: BAYRY), down 4%, and Pfizer, Inc. (NYSE: PFE), down 2%.