Full Breakdown
Novartis Faces Shareholder Push for Board Overhaul After Dual Trial Failures
By Drooid · · How we work
Core Event: Shareholder Calls for Board Shake-up
On September 10, David Samra, managing director at Artisan Partners and founding partner of International Value Group, publicly urged a restructuring of Novartis’ board. Samra said the board must strengthen oversight of acquisitions after a muscle-wasting disorder drug from the $12 billion Avidity takeover failed a late-stage study and a heart-drug candidate, pelacarsen, disappointed investors. The setbacks sent Novartis shares down more than 10%, erasing nearly $30 billion in market value.
Background & Context
Novartis CEO Vas Narasimhan has overseen a 60 % share-price rally since taking the helm in 2018, despite a challenging global environment. The company’s recent M&A activity includes the 2024 acquisition of German biotech MorphoSys, which was written down only months after the deal.
Official Statements & Responses
Novartis issued a statement affirming that its financial guidance remains unchanged despite the trial setbacks.
Data & Statistics
- Share price decline: >10 % on the day of the announcements.
- Market-value loss: ? $30 billion.
- Year-to-date gain before the slide: ? 20 %.
- CEO-led share-price rally since 2018: ? 60 %.
- Acquisition amounts: $12 billion for Avidity; 2024 purchase of MorphoSys (value not disclosed).
Verbatim Quotes
- “I think he needs to make changes at the board level. One of them should be on improving the team that's doing these deals because clearly they have been uninspiring at best,” — David Samra, test of CEO
- “I think that the board needs to improve their oversight of acquisitions... they need to bring in better talent on the board to do that and have an acquisition committee.” — David Samra, test of CEO
- “If you do a $12 billion deal and it goes to zero, the management needs to be penalised for that,” — David Samra, test of CEO
- “The acquisition track record is not very good,” — David Samra, test of CEO