Swiss pharmaceutical major Novartis AG ( NVS ) reported third-quarter 2025 results on Tuesday, reaffirming its full-year guidance as strong sales from key growth drugs offset mounting generic competition in the U.S.

The company’s net sales rose 8% year over year to $13.91 billion, missing Wall Street’s consensus estimate of $14.11 billion. On a constant-currency (cc) basis, sales were up 7%.

Core operating income climbed 6% to $5.46 billion (+7% cc), supported by a 16-percentage-point contribution from higher volumes.

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These gains were partly offset by a 7-percentage-point drag from generic erosion, mainly from Promacta, Tasigna, and Entresto, and a 2-percentage-point negative impact from pricing pressures.

Despite the generic headwinds, Novartis ( NVS ) maintained a stable core operating income margin of 39.3% (cc). Core net income came in at $4.3 billion, up 5% year over year (+6% cc), while adjusted earnings per share of $2.25 were in line with analyst expectations.

Vas Narasimhan, CEO of Novartis ( NVS ), said, “Novartis delivered solid financial performance in Q3, more than offsetting the impact of increasing generic erosion in the U.S. Our key growth drivers performed well…we remain well on track to achieve our guidance for 2025 and over the mid-term.”

Growth was fueled by strong demand for several blockbuster therapies. Kisqali, the company’s breast cancer treatment, surged 68% (cc) to $1.33 billion, while Kesimpta, for multiple sclerosis, rose 44% (cc) to $1.22 billion. Scemblix climbed 95% (cc) to $358 million, and Pluvicto, used in prostate cancer treatment, advanced 45% (cc) to $564 million.

Fiscal 2025 Outlook

Novartis ( NVS ) reaffirmed that net sales will grow in the high single digits for fiscal 2025, while core operating income is projected to increase in the low teens.

The company continues to see steady momentum across its innovative medicines portfolio despite a challenging pricing and patent environment.

Strategic Expansion Through Acquisitions

In a major strategic move, Novartis ( NVS ) recently agreed to acquire Avidity Biosciences Inc. ( RNA ) in a $12 billion all-cash deal, one of the largest biotech acquisitions of the year.

Analysts noted that the acquisition underscores Novartis’ push into neuroscience and rare diseases, adding Avidity’s late-stage antibody oligonucleotide conjugate (AOC) pipeline, which holds promise for muscle and neuromuscular disorders.

Separately, Novartis ( NVS ) announced plans to launch a direct-to-patient platform in the U.S. starting November 1, 2025, allowing cash-paying patients to purchase Cosentyx (secukinumab) at a 55% discount off the list price.

The move is seen as part of the company’s broader effort to expand patient access and reduce dependence on traditional pharmacy benefit manager (PBM) channels.

Price Action: NVS stock was trading lower by 2.91% to $125.37 premarket at last check Tuesday.

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