BENCHMARKING
In 2005, Novartis was widely recognized for its Corporate Citizenship program:
| • | Fortune
magazine named Novartis one of the World’s Most Admired Companies | | • | The
Financial Times ranked Novartis among the World’s Most Respected Companies | | • | Barron’s
magazine named Novartis one of the World’s Most Respected Companies. |
Novartis also is recognized as a leader by the rapidly expanding Socially Responsible
Investment (SRI) community. In 2005, Novartis was again selected as a component
of the Dow Jones Sustainability Indexes (DJSI), which track the performance of
companies in terms of corporate sustainability. KEY
CHALLENGES Pharmaceutical innovation in coming decades
must address emerging diseases and other unmet medical needs to deliver sustained
improvements in life expectancy and quality of life comparable to those achieved
in the 20th Century. Yet a flow of new medicines can’t be taken for granted.
Daniel Vasella, M.D., Chairman and Chief Executive Officer of Novartis, emphasizes
the dominant role played by pharmaceutical companies in conducting and funding
research and development. “Often the public forgets or ignores the immense progress
achieved by medical practice thanks to modern pharmacotherapy,” Dr. Vasella says.
“Remember that overall, the pharmaceutical industry invests more than USD 50 billion
a year in research and development, the single most important source of investment
in health research.” |
| During
2005, the Novartis Pharmaceuticals Division increased R&D investments by 18% to
almost USD 4 billion, one of the highest figures in the global pharmaceutical
industry relative to sales (19.6%)1. Still, there
is considerable public hostility to the pharmaceutical industry today. Critical
stakeholders and the media attack the industry on issues ranging from pricing
and promotional practices, to limited access to medicine in developing countries
and scant research devoted to “neglected” diseases such as tuberculosis and malaria.
In addition, drug safety has moved into the spotlight following withdrawals of
major medicines in recent years. Pharmaceutical companies
are subject to more stringent scrutiny by the public and regulators than many
other industries. Regulatory agencies may at any time
reassess the safety and efficacy of our products based on new scientific knowledge
or other factors. In addition to normal price competition in the marketplace,
the prices of our Pharmaceuticals Division’s products are subject to direct controls
and other pressures imposed by governments and health care providers in most countries.
There are significant differences, however, between strategies of individual companies
within that regulatory framework. Novartis, for example, is the only major pharmaceutical
company holding positions of global leadership in both innovative, patent-protected
medicines and generics.
CLINICAL TRIAL REGISTRY
During 2005, Novartis and other pharmaceutical companies unveiled major initiatives
to improve disclosure of results of clinical trials. The move came amid legal
challenges 1 Figure is percentage of Pharmaceuticals
Division sales |
| in
the US – and calls from editors of 11 major medical journals for creation of a
public registry for clinical studies involving human patients. That
registry became reality last year under the leadership of Dr. Vasella in his capacity
as President of the International Federation of Pharmaceutical Manufacturers Associations
(IFPMA). Fulfilling a pledge to provide an industry blueprint to improve clinical
trial transparency, IFPMA launched a clinical trials portal offering access to
online information concerning more than 250 000 clinical trials worldwide.
In 2003, Novartis established its own web-based registry, providing retrospective
data on results of global and local clinical studies. At the end of 2005, the
Novartis Clinical Trial Results Database (CTRD) included more than 250 trials.
Novartis also provides information on trials of medicines to treat serious and
life-threatening diseases, through an electronic registry sponsored by the US
National Institutes of Health. “We believe that all
trial results must be published – whether they are favorable or not,” says James
Shannon, M.D., Head of Development for the Novartis Pharmaceuticals Division.
“We recognize that there are important public health benefits associated with
making clinical trial information more widely available to healthcare practitioners
and patients.”
DRUG SAFETY The
withdrawal of the painkiller Vioxx® by the US company that discovered and marketed
the drug – along with withdrawals of other medicines in recent years – has ignited
a heated debate about drug safety. “There is no doubt that the news around |
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