Basel, Switzerland-based Novartis is separating its pharmaceuticals division into two distinct business lines, with one focused on cancer therapies and the second on other drugs, according to Reuters. The pharmaceutical company is also saying goodbye to its CEO in its second high-profile leadership change this year.
David Epstein, division head and CEO of Novartis Pharmaceuticals, will leave the organization to "explore new challenges from the U.S.," the company said, according to Reuters.
The decision to reorganize Novartis' main drugs unit, which makes up roughly two-thirds of its $49 billion in annual sales, demonstrates the increasing importance of oncology to the company since acquiring GlaxoSmithKline's marketed cancer drugs for $16 billion in 2015.
The reorganization comes as Novartis deals with the patent expiration of Glivec, a blood cancer drug, as well as weak revenue from its new heart failure medication, Entresto.
"Novartis expects this change to help drive our growth and innovation strategy, with an increased focus and improved execution," Novartis said in a statement, according to Reuters. "The new structure reflects the importance of oncology to Novartis following the successful integration of the oncology assets acquired from GlaxoSmithKline."
Industry analysts said the separation of the pharmaceuticals business should improve overall transparency and could help showcase the value of Novartis' large oncology operations, according to the report.