Novartis splits drugs business into two, pharma chief to leave
By John Miller and Ben Hirschler
ZURICH/LONDON (Reuters) - Novartis is splitting its pharmaceuticals division into two business units, one focused on cancer and the second on other drugs, while switching out its current pharma head in the second high-profile management reshuffle this year.
David Epstein, the American head of Novartis Pharmaceuticals and a 27-year veteran with the group, will leave the company to "explore new challenges from the U.S.", Novartis said.
Epstein's re-location to the United States implies he is not in the running to replace Andrew Witty as chief executive of British drugmaker GlaxoSmithKline next year, as some have speculated. GSK has said it expects to choose a new CEO towards the end of the 2016.
Novartis' reorganization of its main drugs unit, which accounts for about two-thirds of its $49 billion in annual sales, shows the growing importance of oncology to the company, after it bought GSK's marketed cancer drugs for $16 billion last year.
It comes as Novartis struggles with the patent expiration of blood cancer drug Glivec and slower-than-expected revenue from its new heart failure medicine, Entresto.
Epstein is the second high-ranking Novartis official to exit within months. Ex-Hospira chief Michael Ball replaced Jeff George at the company's struggling Alcon eye care business in January as its sales declined again.
"Novartis expects this change to help drive our growth and innovation strategy, with an increased focus and improved execution," the company said in a statement.
"The new structure reflects the importance of oncology to Novartis following the successful integration of the oncology assets acquired from GlaxoSmithKline." Continued...