May 23, 2019 / 1:26 PM / a month ago

Novartis CEO sees chance to accelerate profit margin target

FILE PHOTO: CEO Vas Narasimhan of Swiss drugmaker Novartis addresses the company's annual news conference in Basel, Switzerland January 30, 2019. REUTERS/Arnd Wiegmann

ZURICH (Reuters) - Novartis could reach its main drugs business’s margin target “a little sooner” than 2022, as it now forecasts, as it cuts costs and as new drugs including gene therapy accelerate, Chief Executive Vas Narasimhan told investors.

“Our goal right now is to get to the 35%, and make sure that’s a sustainable 35%,” Narasimhan said at a U.S. event. “That could happen a little sooner, we’ll see based on how the launches go. If they did (launch well), I think we would get there sooner, and our goal would be then to continue to push beyond that.”

Hitting the target would mark an increase from the first quarter of 2019, when the Swiss drugmaker’s core operating income of $2.92 billion rose to 33.3% of sales, from 31.3% in the year-earlier period.

Reporting by John Miller; Editing by Michael Shields

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