2:21 PM
Jun 14, 2019
 |  BioCentury  |  Product Development

Despite senior management shake-up, Novartis’ pipeline is primed to deliver

Why the executive exodus at Novartis likely won’t derail CEO Narasimhan’s growth plans

A string of departures at Novartis AG and strategic shifts by new CEO Vasant Narasimhan have produced a fairly thorough makeover of the executive committee he inherited in 2018. The team gains a pipeline that is stocked with first-in-class agents and potential blockbusters -- dealing the newcomers a strong hand as they settle in.

In the space of two weeks, Novartis lost one executive team member and two other leaders, bringing to four the top level departures this year.

But it’s not all one-way traffic. Narasimhan been filling positions with internal and external talent, finding leaders with experience in growing commercial revenues and managing new modalities, both of which will be necessary ingredients for the pharma’s success.

In all, his executive team contains eight new faces since he took over as CEO, including two newly-created positions. Ten members of the team -- including himself and head of early R&D Jay Bradner -- have less than three years’ tenure. Bradner is President of Novartis Institutes of BioMedical Research (NIBR) (see Figure: “Shuffling the Deck at Novartis”).

The longest standing members lie outside of R&D and commercial operations -- CFO Harry Kirsch and Chief People and Organization Officer Steven Baert, who both joined the executive committee in 2014. 

Novartis says the shake-up won’t halt its momentum.

“We have a new, diverse leadership team in place that shares the same cultural and strategic aspiration and is committed for the longer term. Moreover, we have a good track record in managing leadership changes without disrupting the business,” the pharma said in an emailed statement to BioCentury.

The new executives have been handed a healthy portfolio.

In his 18 months, Narasimhan has added assets via licenses and acquisitions and expanded Novartis’ digital technologies, including the launch of the first digital therapeutic.

He has also added novel modalities via acquisition of gene therapy company Avexis Inc. and radio-ligand therapy companies Advanced Accelerator Applications S.A. and Endocyte Inc.

The result is a pipeline of 25 candidates spanning Phase II to registration, with 10 earmarked as blockbusters, including multiple first-in-class candidates.

The new additions to the committee now have to get these assets across the finish line and execute on launches, about half of which will be in competitive markets.

Figure: Shuffling the deck at Novartis

In the 18 months that Vasant Narasimhan has been CEO of Novartis AG, the pharma's executive committee has undergone dramatic changes, with only four of the 13 members having more than two years’ tenure on the committee.

Narasimhan has elevated two positions to the executive committee, split a previous position in two, and removed a position. These changes reflect Narasimhan's focus on innovative medicines and digital health, and his desire to make Novartis' operations more efficient. For example, the position of digital health officer was created prior to his appointment as CEO, but in March 2018, Narasimhan elevated Bertrand Bodson to the executive committee, providing him more clarity as he integrates digital technologies across the company's business.

Two of the members represent new roles at the pharma after the departure of Andre Wyss, who served as president of Novartis operations. When he departed in 2018, his role was split into the more focused functions of business services and technical operations.

The CEO position of Alcon Inc. was eliminated after the unit’s spin out into a publicly traded company in April.

Three other positions have seen turnover due to retirements and departures to other companies. These are President...

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