“We are very well positioned for the golden decade”

The war in Iran is affecting the flow of goods. Is Sandoz affected? If so, to what extent could this affect your revenue?

The situation is very concerning for everyone affected. At this stage, we do not expect significant supply chain disruptions or other material impacts on our business for the foreseeable future, as we have had alternative supply routes in place for several years now. However, the longer this conflict continues, the greater the impact on supply and energy costs will be, not only for our industry but for all of us. Ensuring secure access to essential medicines is not just an operational challenge, but a question of long-term healthcare autonomy and resilience. We are aware of the important role that we play.

In the longer term, particularly between 2028 and 2033, the pharmaceutical industry will face a patent cliff. How does Sandoz plan to capture this market?

The brand companies see a patent cliff. We see a ‘golden decade’: for patients, for Sandoz, for our investors, and for healthcare systems in the countries where we operate. Branded medicines worth an unprecedented ~$650 billion-plus are due to lose exclusivity over the next 10 years. Roughly half is in biosimilars, the other half in generics. The current Sandoz pipeline targets nearly two-thirds of that total by value.

As the global leader in affordable medicines, we are already strongly positioned to succeed. We are also investing today to build additional capacity, to drive increased patient access in the future. Regulatory streamlining will also support the opportunity, meaning we can develop more biosimilars and get more medicines to more patients.

With over 400 molecules in development and 32 biosimilars, your pipeline is particularly robust. Which products do you consider the most promising?

It’s probably misleading to call out specific assets, because our strength is precisely in the depth and breadth of our pipeline. The biosimilar candidates are the largest and most exciting opportunities, while the generic assets are equally important and provide volume and scale.

Biosimilars are progressing faster and offering better margins. How do you explain this phenomenon?

On the supply side, biosimilars are complex large molecules made from living organisms, which are more difficult and expensive to develop than standard generics. Sandoz has highly advanced capabilities for this, combined with the strengths of our leading generics platform, but not everybody does. And demand is intensive and growing all the time – because this relatively new class of medicines offers societies amazing benefits in terms of increased access at lower cost, changing more patients’ lives for the better.

Launched in 2006, Omnitrope was the first authorized biosimilar. Twenty years later, it remains one of your best-selling products. How do you explain such longevity?

Because we remain committed to providing patients and healthcare systems with the best possible option – something the competition has been unable or unwilling to do. That’s the thing about biosimilars: the different market dynamics mean you don’t see the steep price declines you often have with generics. Omnitrope is a great example: we operate in a multicompetitor market, where we have not only maintained our leadership against new entrants but have also overtaken the reference medicine.

The first patents for diabetes and obesity medications expire in 2026. When will you enter this promising market?

GLP-1s are a huge opportunity, but Europe and the US are still several years out. We plan to launch in some early markets, notably Canada and Brazil, potentially by the end of this year. It’s too early to make financial predictions, as this market has no clear historical parallels. There’s no major drug class to date where the originators were unable to meet market demand. So, we’ll carry on watching the signals, but initial signs are promising.

What factors could jeopardize the projected growth link to the patent cliff?

We certainly won’t be the only company targeting this patent cliff – and that’s a good thing. Healthy competition is good for patients and for healthcare systems. Indeed, 10 years from now, we may be facing competitors that are not yet on our radar. It’s a highly dynamic environment, where speed and agility are critical, but we’re ready for it.

For biosimilars in particular, the issue today is more the lack of financial incentive to develop new versions of many molecules, particularly smaller ones: the ‘biosimilar void’. But it’s encouraging to see regulatory moves towards streamlined development, which promise to significantly reduce both cost and time to market. We are seeing a growing tendency by some brand companies to extend monopolies through various forms of patent abuse.

We are determined to stop this, as it prevents patients from accessing the medicines they need. And we have one of the best legal teams in the industry. So, I am very optimistic.

Generic drug manufacturers are regularly sued by originators. Why is this?

Patents and regulatory frameworks exist to ensure a balance between protecting innovation and protecting the public interest. And we support that at Sandoz too. But monopolies are a lucrative business, and some originators exploit any available loophole to extend the patent life. For them, the legal cost of doing this is small compared to the high profits it can generate. Patients and healthcare systems pay the price.

Generic and biosimilar companies are challenging the originators on these practises, but the regulators are not doing this so much. Sandoz and other generic and biosimilar companies therefore have an extremely important role to play in ensuring the affordability of healthcare systems in our countries. We’re pushing very hard for reforms that would restore fair competition.

What are your annual legal fees and how do you expect them to change in future?

While we don’t disclose specifics, patent abuse by some originators means we have to spend much more than is necessary. More importantly, these unlawful practices block patient access to affordable medicines and increase healthcare system costs. Ultimately, the central priority should be improving access for patients.

The price of antibiotics is falling. Will Sandoz maintain this activity in the long term, given the demand on the one hand and the very low margins on this type of product on the other?

Antibiotics are the backbone of modern medicine. Sandoz pioneered this field 80 years ago and continues to lead the way, with Europe’s last major end-to-end production network for penicillin. I hope we’ll still be leading the way 80 years from now. But that will only happen if governments and regulators act to ensure a sustainable market framework that lets us sell these critical therapies at a price that reflects their true value to society – not at the price of a pack of chewing gum.

Sandoz is a Swiss company but doesn’t manufacture anything here…

We’re very proud to be a Swiss company, with a 140-year heritage that starts right here, in Basel. However, given the economics of our industry, manufacturing in Switzerland would be too expensive, and we need to be competitive. The day that changes, we’ll be knocking at the door! But note that Europe is our home region and the majority of our production is here in Europe.

India has become the world’s pharmacy. Aren’t you concerned about this low-cost competition, given that most of your factories are located in Europe?

It’s a very real challenge: Europe combines high labour and energy costs, high bureaucracy, and a lack of government support for some key industries. Let’s be clear, though. Our goal is to be the most trusted and reliable supplier of affordable, high-quality medicines – profitable and sustainable.

Our European base positions us to meet that goal, provided policymakers ensure a functioning market framework that enables fair competition. That will need to include some form of incentive for domestic production and protection against price dumping from Asia, to guarantee long-term sustainability and strategic autonomy.

Sandoz has a relatively small presence in the United States – the world’s largest market for generic drugs – with 22% of your revenue generated in North America. Do you plan to expand your business in the United States in the coming years?

Sandoz is a European-based company, with a solid and growing presence in the US. The US offers considerable opportunities to expand.

From our strong European base, we are well positioned to pursue the growth opportunities in the large but complex US healthcare market – complex from both a legal and system perspective. The intellectual property (IP) and legal environment in the US make it challenging to launch new products: there can be a new patent challenge lurking around every corner. So, we’re excited about growing in the US, particularly in biosimilars – and clear-eyed about how to manage it.

So far, generic drugs have been spared tariffs in the United States. What visibility do you have for the future, given the unpredictability of the Trump administration?

Our Sandoz colleagues have had good discussions with the US administration. The US administration seems to recognise the critical importance of generic and biosimilar medicines for patients, and that the generic and biosimilar industry provides 90% of medications for US patients at about 12% of the total cost. But I don’t have a crystal ball.

Would you be willing to build factories in the United States to expand in the American market while avoiding potential tariffs? And why?

I would love to say it makes economic sense to build production facilities in the world’s largest market. That’s not yet the case. The underlying problem in the US is not production costs; it’s related to the US healthcare system, its economics, the extent of patent abuse, and every launch by a generic company being litigated by the originator. The good news is that market dynamics can be changed by governments with a commitment to do so. Fingers crossed!

During the annual results press conference, you announced that Sandoz was in discussions with the US government on numerous issues. What are these issues?

I’m not in a position to add much just yet. What I would say right now is that we are having meaningful and ongoing discussions with people who seem to understand the underlying issues.

In 2024, Sandoz was sanctioned by France due to a drug shortage and insufficient stockpiles. How can drug shortages be prevented?

I would ask a question in return: what is a drug shortage? Very often, the drug is available in a neighbouring region or country, but some bureaucratic regulatory requirement prevents the exact same medication from being shipped over the border. One quick fix – which the Swiss are now implementing – is to introduce electronic leaflets.

More generally, if you want to ensure stable supply, then you need to reward healthy competition, by allowing companies to respond flexibly to temporary demand shifts. What won’t help is to perpetuate the current system of constant price pressure, regardless of economic and political reality. It’s Economics 101: you can’t drive prices to the bottom, my earlier comment on this; perhaps it will remain as is?

Do you think requiring companies to build up stock-piles is the right approach to solve the problem?

No. If companies need to produce at full capacity to be competitive, then obligatory stockpiles simply divert products from the market or choke off supply to other countries. Also, stockpiles might need to be written off partly over time and are a waste to society.

Since its separation from Novartis in 2023, Sandoz share price has risen by more than 150%. Was the integration into Novartis a hindrance? What did the separation bring you?

The separation was the right strategic choice for both companies: we operate in two increasingly different industries. Sandoz today is the standalone global leader in affordable medicines, with the financial backing and strategic freedom to truly fulfil its Purpose: pioneering access for patients.

What makes Sandoz so attractive to investors?

Investors see that we deliver consistently on our promises in terms of reaching both our strategic and financial performance milestones. As of end 2025, we recorded 17 consecutive quarters of net sales growth. And we are very well positioned for the golden decade as the global market leader in biosimilars.

What’s more, I think we have raised the profile of the industry as a whole, not least thanks to our substantial social impact. In 2025, we reached more than 1 billion patients and saved healthcare systems well over $25 billion, while our total social impact is estimated at around $400 billion annually.