Novartis CEO Vas Narasimhan hits the brakes on US drug price hikes -- right after tapping the gas
President Donald Trump may not be getting the cascading drug prices he promised, but he is holding the line against any increases — at least for this year.
Novartis CEO Vas Narasimhan today joined Pfizer CEO Ian Read in promising to put the brake on US drug price hikes. And that will add to the pressure on the rest of the major players to do the same.
“We have voluntarily pulled back on any further price increases this year,” Narasimhan told reporters during a conference call today.
Novartis apparently can afford it. A big Q2 beat estimates on the pharma giant’s numbers, helping push its stock price up more than 2%. Narasimhan promised analysts that Novartis would hit the top of the range on its profit forecast for the year.
One reason for that projected performance may be because Novartis just recently raised prices on some of its priciest drugs, as reported by Politico just days ago.
The price freeze arrives after Novartis has been hammered on the ethics front for months in the wake of revelations that former CEO Joe Jimenez had agreed to pay Trump’s personal attorney, Michael Cohen, $1.2 million for a consulting contract. The company portrayed the relationship as brief and inconsequential, only agreeing to pay out the money in monthly allotments because it was contractually bound to do so.
But just days ago Democratic senators who had been probing the link outlined months of contacts between the ex-CEO and Cohen, saying that the current executive crew in charge had misrepresented that relationship, which was continued at least to last fall, which they said was evidence of the company’s willingness to pay for influence with the new administration.
Novartis, bunkered down now, kicked back against the accusations. But the company has had little success in clearing the air.
Image: Vas Narasimhan.