Major Novartis Shareholder Calls for Board Changes After Drug Trial Setbacks
A major shareholder in Novartis has called for a board shake-up following significant setbacks in clinical trials, which led to the company's shares falling by more than 10% and wiping nearly $30 billion from its market value. David Samra of Artisan Partners criticized the board’s oversight of acquisitions, particularly highlighting failures like the Avidity deal and the MorphoSys acquisition. He urged improvements in governance and compensation structures but did not blame CEO Vas Narasimhan for recent issues. The setbacks include a failed late-stage trial for a muscle-wasting disorder drug acquired from Avidity and disappointing results from heart drug pelacarsen, which had already caused an earlier drop in shares. Novartis maintains its financial guidance remains unchanged and emphasizes continued investment in organic growth and shareholder returns through dividends and buybacks. Samra's public call for change may encourage other investors to push for reforms as activist pressure mounts over the company’s M&A strategy.
Tickers: $NVS
Topics: Drug Trial Setbacks Pharmaceuticals Shareholder Pressure