Pharma giant increases profits by 31% as brands shine

The Irish arm of pharma giant Novartis last year increased its profits by 31% on the back on strong performance by a number of brands.

In accounts filed by Novartis Ireland Ltd to the Companies Office, the firm increased its pre-tax profits from €1.4m to €1.86m.

This followed revenues at the firm increasing from €61.9m to €66.4m in the 12 months to the end of Dec 2012.

Novartis is one of a number of pharma giants that operate out of Ringaskiddy, Co Cork.

According to the directors’ report, its revenues increased by 7.3%, “driven by the strong performance of its launched brands”. New brands launched last year included Seebri, Binocrit, Zarzio, and Gilenya.

The directors state gross margins decreased from 2011 due to changes in the portfolio mix.

They point out that a “three-year framework was agreed, as of Nov 1, 2012, between the Irish Pharmaceutical Healthcare Association and the Department of Health and the HSE on the supply terms, conditions, and prices of medicines”.

According to the report: “The directors are pleased with the performance of the company for 2012 given the continued economic environment and competitive pressures in the market.”

The directors state that Novartis was in a strong position at year end, with net current assets of €11m.

The figures show that the company’s cost of sales last year increased from €42.2m to €46.3m, with its selling and marketing costs falling slightly, from €16.1m to €15.6m.

The figures show that Novartis’s operating profit last year increased from €1.5m to €1.9m.

The company’s profits were reduced by €47,000 in ‘other finance’ costs. The firm incurred an actuarial loss of €4.2m and accumulated profits reduced to €7.8m.

The filings show that staff costs at Novartis last year increased from €8.4m to €8.7m&.

The report also shows that directors’ remuneration for management services last year came to €264,000.