Novartis faces shareholder criticism over drug prices at AGM

ZURICH (Reuters) - Novartis's shift into high-tech drugs won praise for providing patients with new options but criticism over prices that may run into the millions of dollars at the Swiss drugmaker's annual general meeting on Thursday.

Shareholders at the event in Basel also approved Novartis's planned spin-off of its Alcon eyecare unit, due for coming months, with investors with five Novartis shares due to receive one share of Alcon stock.

Swiss shareholder group Actares said insurance systems are being "taken hostage" by high prices for life-saving drugs. It called out Novartis's $475,000 cancer cell therapy Kymriah and its still-unapproved gene therapy for spinal muscular atrophy that Novartis contends is cost-effective at $4-$5 million per patient, while independent groups have concluded its value is less than that.

Chief Executive Vas Narasimhan, who did not testify this week before the U.S. Senate with other global drug industry executives also facing criticism for drug prices, said he seeks to price medicines based on their value, adding Novartis needs a fair return to further research and development.

"With respect to pricing in cell and gene therapies, I think what's often lost in the discussion is the remarkable impact of these medicines," Narasimhan said. "These are true breakthroughs that come from a single infusion of a medicine that don't require lifelong therapy."

Actares President Veronika Hendry said high drug prices present society with difficult questions over access.

"With this business model you are taking hostage an insurance system that depends on solidarity," Hendry said. "There's currently a broad discussion going on over exorbitant drug prices, and this discussion is creating resentment and disbelief."

(Reporting by John Miller; Editing by Michael Shields and Brenna Hughes Neghaiwi)

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• Euro zone inflation rises above 3%, cementing ECB rate hike bets
• Spain's PLD Space adds $125 million to its latest funding round
• Germany to blame Moscow for airport drone incident on Tuesday, Bild reports