ZURICH Oct 25 Delays to restarting production
at the U.S. factory that makes Novartis AG's popular
migraine medicine Excedrin are turning into a major headache for
the Swiss drugmaker's boss.
Joseph Jimenez is so fed up with having to push back the
timeline to restart manufacturing at its consumer health site in
Lincoln, Nebraska that he's given up making forecasts.
"What I would like to do is stop making projections, because
we've proven that we are not able to accurately project,"
Jimenez told reporters at its third-quarter results
Novartis suspended production at the site late last year
after consumers complained of chipped and broken pills,
inconsistent bottle packaging and the mixing of different
products in the same container.
The company had hoped for production to restart in May, with
shipments of over-the-counter (OTC) brands resuming mid-year,
but it has been forced to repeatedly push back that timeframe.
Novartis is the latest in a string of big drug makers to be
plagued by manufacturing issues, as price pressures and the loss
of patents on best-selling treatments force them to trim costs.
In the most high-profile case in recent years, Johnson &
Johnson Chief Executive William Weldon stepped down in
April after repeated recalls called into question the quality of
the healthcare group's products.
Novartis Chief Financial Officer Jon Symonds said last year
that J&J's quality control problems had allowed the Swiss group
to grab market share from its U.S. rival.
Now its consumer health business is hurting from its own
quality issues. Sales at the division fell 22 percent in the
third quarter, on top of drops of 24 and 20 percent in the prior
two quarters. The site has annualised sales of $1 billion.
Novartis is banking on a loyal following of consumers to
make sure the sales hit is not permanent. Jimenez said the
drugmaker had received numerous emails from consumers asking
when Excedrin would be available again in the United States.
"If you have brand loyalty people miss you and while it's
unfortunate ... being missed as a brand is what you strive for,"
said Jane Parker, CEO of InterbrandHealth.
"In Excedrin's case when you look around the Internet people
are searching for Excedrin. It has a loyalty and there is an
implied commitment between the customer and the brand."
Novartis said on Thursday it had outsourced the production
of three OTC products - Lamisil, Excedrin and Triaminic - to
third party manufacturers to get products to consumers as
quickly as possible.
Jimenez said these products should be available in the
fourth quarter. "We're going to go and thank our most loyal
users for waiting with us," he said.