Novartis AG is ramping up marketing efforts for the heart drug Entresto, one of two new medicines essential to generating revenue as the company’s bestseller faces generic competition.
The Swiss drugmaker will spend an additional $200 million to hire sales representatives and educate physicians after new treatment guidelines were issued in May backing the use of Entresto for heart failure. The Entresto sales force may increase to more than 1,200 people by the end of 2016, compared with about 400 in the first quarter, according to analysts at Credit Suisse Group AG.
“I have to feed Entresto because this is just too important for the long-term growth of Novartis,” Chief Executive Officer Joe Jimenez said Tuesday in an interview.
Novartis is depending on revenue from newer medicines like Entresto and Cosentyx for psoriasis as its blockbuster cancer treatment Gleevec faces generic competition in the U.S. and sales at its eye-care division Alcon slump. Entresto will bring in about $200 million in 2016, and Novartis has projected that the drug will eventually reach peak sales of $5 billion a year.
Partly as a result of the increased Entresto spending, Novartis said profit may fall this year. Core operating income will either be about the same as 2015 or decline by a percentage in the low single digits at constant exchange rates, the company said in a statement. Sales will show little change.
“The level of spending this year is significant because it’s a new launch,” Jimenez said. “The spending will follow the normal curve of launches, where it continues for few years and then it reduces after that.”
Novartis fell 0.9 percent to 79.70 Swiss francs at 11:28 a.m. in Zurich. The shares have declined about 21 percent this year.
Entresto generated $32 million in the second quarter. Analysts had cut their estimates by about 25 percent in the last three months to an average of $34 million, according to data compiled by Bloomberg.
The drug has received a warmer reception in Europe than the U.S., the largest market for pharmaceuticals, since its introduction last year.