Shares in Novartis (NYSE:NVS) were up today after the company beat expectations on Wall Street with its second-quarter financial results.
The Switzerland-based company posted profits of $7.77 billion, or $3.34 per share, on sales of $13.16 billion for the three months ended June 30. Novartis saw its quarterly sales climb 7% compared with the same period last year.
Adjusted to exclude 1-time items, earnings per share were $1.29, ahead of consensus on The Street, where analysts were looking for sales of $12.94 billion.
“We made significant progress this quarter to transform Novartis into a focused medicines company. We completed the Alcon strategic review, exited the OTC joint venture, and strengthened our innovation engine with the acquisition of AveXis,” CEO Vas Narasimhan said in prepared remarks.
The chief executive also told reporters at Bloomberg and CNN that Novartis plans to hold off on raising the prices of any of its medicines for the remainder of the year. The move comes a week after President Donald Trump criticized Pfizer and its CEO, Ian Read, on Twitter about the company’s plan to hike the prices of several of its drugs.
Read eventually agreed to defer any price increases until next year and Trump swiftly followed his critical tweet with a call to action for other pharmaceutical companies.
“Pfizer is rolling back price hikes, so American patients don’t pay more. We applaud Pfizer for this decision and hope other companies do the same,” he tweeted.
Novartis’ plan to hold off on its price hikes comes as the company works to find a way out of the limelight – reports revealed in May that former Novartis CEO Joe Jimenez agreed to pay nearly $1.2 million to a consulting firm linked to Michael Cohen, the president’s attorney.
The pharmaceutical company said that it paid $100,000 per month for a one-year deal to gain Cohen’s insight on how to navigate the Trump administration’s approach to healthcare policy, bringing the total to more than $1 million.
Novartis has fought to distance itself from the controversy, largely pinning the decision to enter into the contract with Cohen on ex-CEO Jimenez. The company has also noted that it quickly determined that Cohen could not deliver the insight that Novartis was looking for.
Today’s Q2 beat and promise to hold off on drug price increases helped push the company’s shares up – NVS shares were trading at $80.86 apiece in mid-morning activity, up 2.8%.
