- The spin-off is expected to be completed in H2 2023, subject to approvals.
- Sandoz generated USD 9.6bn in sales in 2021.
- Sandoz will be listed on the SIX Swiss Exchange with an ADR program in the US.
- Novartis will focus on five core therapeutic areas and technology platforms.
Spin-Off Overview
Novartis plans to separate Sandoz, its generics and biosimilars division, into a standalone company through a 100% spin-off. This move aims to maximize shareholder value by creating the leading European generics company and a global leader in biosimilars. The spin-off will allow Novartis shareholders to benefit from the potential future growth of both Sandoz and Novartis Innovative Medicines.
Strategic Focus
The separation will enable both companies to pursue independent growth strategies. Sandoz is expected to leverage its existing biosimilars pipeline of over 15 molecules and a strong management team to drive its next wave of growth. Novartis will focus on becoming a more concentrated innovative medicines company, enhancing its financial profile and return on capital.
Financial and Structural Details
Sandoz will be headquartered in Switzerland and listed on the SIX Swiss Exchange, with an American Depositary Receipt (ADR) program in the US. The transaction is expected to be generally tax neutral for Novartis and is subject to market conditions, tax rulings, final Board endorsement, and shareholder approvals, with completion anticipated in the second half of 2023.
Future Plans for Novartis
Post-spin-off, Novartis will continue to strengthen its position in five core therapeutic areas: Hematology, Solid Tumors, Immunology, Neuroscience, and Cardiovascular. The company will also focus on technology platforms such as Gene Therapy, Cell Therapy, Radioligand Therapy, Targeted Protein Degradation, and xRNA. Novartis aims to maintain a balanced geographic footprint and progress its new organizational structure to increase focus, competitiveness, and synergies.
Sandoz's Growth Strategy
Sandoz, as a standalone entity, will focus on its vision to deliver patient access by investing in key strategic areas like Biosimilars, Antibiotics, and Generic Medicines. The company aims to achieve an investment-grade credit rating, providing financial flexibility for growth and attractive dividends.
