Novartis Q2 2026: Entresto Sales Plunge 50%, Pipeline Advances, and Plant Closure
Novartis posted Q2 2026 earnings above expectations but a 50% drop in Entresto sales from U.S. generics hurt performance. The company highlighted new EU and Japan approvals for Rhapsido and Itvisma, and a manufacturing restructuring including a German plant closure and investment in radioligand production. A $1.8 billion peptide drug pact with Unnatural Products was also announced.
Novartis reported second-quarter 2026 sales and core operating profit that exceeded analyst estimates, but the results were tempered by a steeper-than-expected impact from generic competition. Entresto, the company’s blockbuster heart failure drug, saw U.S. sales drop 50% to $1.18 billion as generics entered the market. European patent exclusivity for Entresto will begin in November, and analysts project a slower rate of decline later in the year.
Despite the generic erosion, Novartis reaffirmed its full-year 2026 guidance: low-single-digit growth in net sales and a low-single-digit decline in core operating income, with foreign exchange translation expected to add roughly one percentage point to both metrics.
The quarter also brought several pipeline and regulatory milestones. The company secured approvals for Rhapsido in the European Union and Japan and for Itvisma in the European Union. For Kisqali, six-year follow-up data were released and the U.S. Food and Drug Administration granted pediatric exclusivity. A biologics license application was submitted for Del-zota, and Del-brax demonstrated positive Phase I/II biomarkers.
In manufacturing operations, Novartis plans to close its solid dosage production site in Wehr, Germany, by the end of 2028, a move that will eliminate approximately 220 jobs. Simultaneously, the company is investing €35 million ($41 million) in a new facility in Halle, Germany, dedicated to radioligand therapies for personalized cancer treatment; the site is scheduled to begin operations in 2027.
Separately, Novartis entered a research collaboration and licensing agreement with Unnatural Products focused on orally delivered macrocyclic peptides for cardiovascular disease. The deal is valued at up to $1.8 billion, consisting of a $100 million upfront payment and up to $1.7 billion in milestone payments, plus tiered royalties on net sales ranging from mid-single to low double-digits. Novartis will lead IND-enabling studies, clinical development, manufacturing, and global commercialization.