Novartis CEO To Step Down Next Year

Novartis announced the shocking departure of Chief Executive Officer Joseph Jimenez after eight years at the helm of Europe’s largest drugmaker, handing off the challenge of selling underperforming assets and developing new medicines to a Harvard-trained doctor.

Novartis CEO Joe Jimenez will step down on Feb. 1 and hand over to drug development chief Vas Narasimhan to decide the fate of $50 billion in assets and make good on a pledge to return the Swiss company to sales growth.

Jimenez, 57, who is stepping down after eight years at the helm, restructured and streamlined the Basel-based drugmaker following its rapid global expansion through mergers and acquisitions under his predecessor Daniel Vasella.

He has hived off animal health, vaccines and over-the-counter drugs businesses at Novartis to focus on generally more profitable prescription medicines, particularly in cancer.

Jimenez said that it was the right moment to hand over and his family “is ready to return to Silicon Valley and the U.S.”

“I’ve been CEO for eight years and I’ve been pretty public about the fact that I didn’t think a CEO should stay much longer than that,” Jimenez said on a call. “You come in, you see what you want to change, you change it, and then it’s time to pass it on to a successor.”

Novartis has had a difficult past two years with sales falling as the patents expired, including on its best-selling Gleevec cancer drug. Initial sales of a new heart drug were disappointing, and uncertainty also remains over the future of its underperforming Alcon eyecare business, acquired from Nestlé for $50 billion in 2010.

Harvard Doctor

Vasant Narasimhan, 41, chief medical officer and global head of drug development at the Basel, Switzerland-based company, will succeed Jimenez from Feb. 1.

Narasimhan joined Novartis in 2005 and has held a variety of leadership positions at the company. He is also among a new generation of youthful leaders at Novartis, including head researcher Jay Bradner at the Novartis Institutes For Biomedical Research.

Prior to his current role, Narasimhan served as head of development for Novartis Pharmaceuticals. Before joining the company in 2005, he worked at McKinsey & Co. He received his medical degree from Harvard Medical School in the U.S. and obtained a master’s degree in public policy from Harvard’s John F. Kennedy School of Government. He holds a bachelor’s degree in biological sciences from the University of Chicago.

Narasimhan’s expertise in clinical development, and medicine make him well suited to run Novartis, especially during the ongoing review of Alcon’s operations, according to Vincent Meunier, an analyst.