Richard Seynor, CEO of Sandoz, had an interview with a journalist from the Slovenian Press Agency
The Slovenian Press Agency published an article on Sandoz's business results in 2020 and the challenges they faced due to the COVID-19 pandemic, on the transformation of Sandoz and also on the operations and importance of Sandoz in Slovenia. The article is based on an interview with journalist Janja Zalar and Sandoz CEO Richard Saynor, and is only available in Slovene at this link. As we wish that foreign-speaking people could also read it, we copy a translation of the article below.
Sandoz CEO: The pandemic highlighted the importance of reliable supply to respond to patients’ needs (interview)
Ljubljana (STA) - The Covid-19 pandemic had a significant impact on the way pharmaceutical companies operate. Generic manufacturer Sandoz, which is also present in Slovenia, initially faced high demand, and it soon became clear like never before how important it is to have reliable supply to respond to patients’ needs, Sandoz CEO Richard Saynor told STA.
Sandoz, the Novartis generics division, has faced huge price pressures in recent years, leading to the announcement of major changes and regional consolidation two years ago. Saynor, who took over the leadership of Sandoz in mid-2019, explained that the transformation has now been largely completed. In doing so, however, they looked not only at the price pressures they face, but at Sandoz strategy as a whole.
They are now implementing their refined strategy, focusing on areas that drive growth. Saynor highlighted sales of biosimilars, as Sandoz is the world’s leading manufacturer in this area. Biosimilars are biological medicines commercialized after the patents for original brands of biological medicines expire. Unlike generics, biosimilars are active substances derived from living cells of plants or animals and not synthetically created compounds.
Sandoz still has the most challenges in the US, where it faces strong competition and substantial price pressures. Although Sandoz announced divestments in the US two years ago, the deal was terminated by mutual agreement last year. "We are the third largest manufacturer of generics in the US. We are thinking about how we can strengthen our business further, it is important that we operate there with a broad portfolio," he commented on the challenges in the US.
Over the last 18 months, Sandoz has also focused on organizing its own supply chain, previously established fully within Novartis. Most of the production sites have also returned under the auspices of Sandoz, so they now control costs and operations themselves. "We focused on growth and where we can introduce new products and we are competitive. I think Covid-19 actually helped us with that, as we realized we do not have to always be the cheapest," he said.
In generics, the cost of manufacturing, the quality of products and accessibility of products to patients are three key determinants, "but you cannot have it all” says Saynor. If you focus on price only, product quality or security of supply may decline. What the pandemic has shown us like never before is how important it is to have reliable supply, including in Europe, to be able to respond to patients’ needs at all times. “Of course, we need to be cost-effective, but that does not mean we need to be the cheapest,” Saynor stressed.
Sandoz started preparing for potential supply challenges as soon as they learned about the start of the spread of the new Coronavirus in China. They increased stocks of key medicines ahead of a significant increase in demand in the first quarter of last year, as countries, as well as patients, began stockpiling. “Because of the uncertainty, there were many stockpiled months’ worth of prescription drugs," he explained.
Demand then stabilized and even declined later in the year, with fewer hospital interventions and fewer contacts resulting in reduced antibiotic use in particular.
According to Saynor, supply chains in Slovenia and Europe were very stable and strong. Sandoz was able to provide medicines on time, and committed to stable pricing on a basket of key medicines used in treating patients with Covid-19.
Sandoz employs more than 21,000 people, including associates in manufacturing, so organizing work in these changed circumstances was also a big challenge.
"The pandemic will certainly have an impact in ways we cannot even imagine. There will certainly be fewer business trips for a while, as these are also expensive and not environmentally friendly," he says. In addition to different ways of organizing work, he also expects changes in communication with doctors, as more and more contact with patients now takes place through various digital platforms.
Last but not least, the pandemic has also triggered policy shifts, as the issue of imports and local production, which can also be important for security of supply, comes to the fore. "This is also an important issue for the Slovenian, Austrian and German governments, which are facing the question of how to ensure better supply," he explained.
Sandoz has one of its largest manufacturing hubs in Slovenia, where it produces injectable and biological medicines, so as a production location it has always been very important for Sandoz. "We have a very long history with Lek, and Sandoz has further built on this. We have a good and supportive relationship with the government, the employees are very talented and engaged, so Slovenia will remain an important part of our network. This will not change," Saynor assured.
"Every time we think about where we need to expand production and introduce new projects, Slovenia is certainly high on the list of potential locations we look at, as we already have a strong development center here," he added.
Regarding the accessibility of its generic and biosimilar medicines in Slovenia, Saynor pointed out that Sandoz has traditionally been one of the largest providers of medicines to the market. The accessibility of generic and biosimilar medicines is currently very good for Slovenian patients. He sees an opportunity for growth in biosimilars, which, according to Saynor, offer patients excellent products at prices that would not otherwise be feasible.
"We see that, when we introduce biosimilars, the market changes radically, as these can really change patients’ lives. And here it is important to be in an ongoing dialogue with the government to see how we can also help the healthcare system," he also told STA.
For additional information contact:
Communications & External Engagement
Lek Pharmaceuticals d. d.
Phone: +386 1 580 22 43
Fax: +386 1 580 24 32