Novartis has record profitability – more jobs in Basel

Posted on 25 October 2008 by Hans-T

Outside of the banks and finance companies, there are many sectors of the Swiss economy that are only minimally affected by the financial crisis and continue to show a growth of jobs in Switzerland.

Consider the case of Swiss pharmaceutical giant Novartis, based in Basel. A Spokesperson for Novartis said this week that Novartis has no exposure whatever to insolvent financial institutions. The group’s figures for the first three quarters show a 12% increase in profitability over last year for a total of $31.4 billion, and a net profit of $7.25 billion. Novartis’ profitability rose by 19% compared to the same period last years, with the 3rd quarter’s results 32% higher over last year’s. Most of the Swiss employment provided by Novartis are jobs in Basel.

The pharmaceutical giant owes its resplendent financial fortunes to the effects of change as well as its global restructuring, in which more than 2500 jobs (mainly outside of Switzerland) were eliminated worldwide.

The multinational drug company, which contributes to the considerable amount of research and engineering work in Basel, has recently been launching an array of new medicines to counter the pressures from the increasing number of generic drugs competing with established Jobs in Basel - Pharmaceuticals - Novartis

pharmaceutical products. Over the last 9 months alone Novartis launched nearly 100 new drugs to offset the losses expected from generics competing with established patented medicines such as Diovan (for hypertension) which by itself is responsible for $5 billion in sales. Nonetheless, analysts say it will not be before 2010 that these new products will reach their full sales potentials. The increased revenue is expected to feed demand for increased research and development work in Switzerland.

Jobs in Basel - PharmaceuticalsAcross the Atlantic, where like its competitors, Novartis got the green light from the American FDA, sales have declined a modest 4%. But Novartis has offset these modest declines with huge gains in emerging economies (+17%) as well as in Europe where sales are up 7%.

Analysts have expressed a bullish attitude on Novartis, noteworthy especially in this period of market turbulence, and continue to recommend buying Novartis stock, considered to be a strong long term investment. Wegelin bank analysts say the stock is a ‘sure value,’ and some analysts see the stock rising above CHF 70.

For Basel, Novartis continues to provide a large number of jobs in Basel and to contribute substantially to tax revenues.

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