Will Novartis’ Entresto drive the business in 2017?
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Will Novartis’ Entresto drive the business in 2017?

Novartis’ advanced heart-failure drug Entresto has been something of a disappointment. After clinical trials that clearly demonstrated it was a better option than anything else on the market, hopes were high that it would become an “uber-blockbuster”. An underfunded launch and patient access barriers have seen this dream fail to become a reality. Even when Novartis started pumping money behind the drug and negotiating with payers to improve access, sales for 2016 totaled a lackluster $170 million against the company’s predicted $200 million. Jefferies analyst Jeffrey Holford, however, thinks Entresto’s fortunes are about to change.

Novartis’ share price is up 11% so far this year

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SOURCE: Yahoo Finance

Holford claims that Entresto’s upswing in sales is set to continue. Entresto garnered $84 million in sales for the first quarter of 2017 – that’s a considerable rise from the first quarter of the previous year, when it raised $67 million. As a result, he is now predicting that the drug will hit revenues of $4.7 billion by 2021 – this is a much more positive forecast than the consensus, which sees Entresto logging $3.1 billion by that time. In a note to clients, he wrote:

"We have already seen one round of acceleration of the Entresto launch in 2016 on the back of the better-than-expected timing and wording of US and European treatment guidelines in May 2016. We believe that this second wave of acceleration will continue for a long time as payer hurdles continue to fall and enthusiasm builds among cardiologists."

Novartis’ CEO Joe Jimenez told investors on the company’s earning call last month that he expected to see “increasing total scripts” for Entresto over the coming year, and that the drug’s story – although slow – was positive. At time of writing, it remains one of the most impressive heart drugs on the market – Novartis is hoping that it gets the recognition it deserves and drives health – and sales – to new heights in 2017.

Disclosure

Dominion holds Novartis in its Global Trends Managed Fund.


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