The New Man at NovartisBy
Joe Jimenez says that more than 20 years selling Clorox (CLX) bleach and Heinz ketchup taught him to make decisions quickly. Now, as CEO of Novartis (NVS), Europe's second-largest drugmaker, he'll try to prove that speed can also make a difference in the pharmaceutical business. Jimenez, 50, is replacing Daniel Vasella, 56, who oversaw the merger of Sandoz and Ciba-Geigy that created Novartis in 1996 and has run the company ever since.
At the moment, Jimenez is basking in the glow of Novartis' fourth-quarter results: Net income advanced 49% year over year to $2.32 billion on $12.6 billion in sales, up 28%. But the new CEO, who previously ran the pharmaceutical unit, will soon get a chance to test his reflexes. Novartis' best-selling treatments, the Diovan hypertension pill and Gleevec, a cancer medicine, begin to lose patent protection in 2012, and Novartis—like all large drugmakers—is scrambling to come up with the next generation of medicines.
Jimenez, an American with degrees from Stanford and the University of California at Berkeley, believes his consumer-products background will help. He started his career at Clorox, the world's largest maker of bleach, ran two divisions of ConAgra Foods (CAG), and oversaw H.J. Heinz' (HNZ) European operations. With consumer packaged goods, "Decisions have to be made quickly because the market moves quickly," he says. But pharmaceutical businesses have long development lead times, which "tends to slow decision-making in areas where it doesn't need to."
Jimenez oversaw the introduction of kid-friendly green ketchup when he was Heinz' North America chief executive, says Heinz Chairman and CEO William R. Johnson. In 2002 he moved to Europe, where he overhauled management and cut costs by consolidating factories. He served on the board at AstraZeneca (AZN) and advised the Blackstone Group (BX) before joining Novartis to head consumer health in 2007.
Vasella, meanwhile, will stay on as chairman. Having built Novartis into a health-care powerhouse with $44.3 billion in annual sales, he doesn't plan to retreat into the shadows. When he took over Sandoz, it generated just 45% of revenue from health care. He shed the agrichemicals business and later sold Novartis' medical nutrition and Gerber baby food units to Nestlé for $8 billion. In a recent interview with Bloomberg, he explained that he decided early last year to step down as CEO in 2010. "The question I'm asking myself is how will I detach myself, how not to intervene but still be here," he says. "I cannot say I'm suddenly disinterested."