Novartis AG’s share price down, appoints Bruno Strigini as chief of the company’s oncology unit

The Switzerland-based Novartis AG made an official statement, revealing that Mr. Bruno Strigini was appointed as head of the companys cancer unit. Mr. Stirgini, who is going to occupy the leading position at one of Novartis most important unit – the oncology division, is known for previously taking the position of president of the European and Canadian operations of Merck.

According to the companys official announcement, the appointment will take immediate effect. Mr. Bruno Strigini will take the helm after Mr. Alessandro Riva is stepping down from the leading position of Novartis Oncology Development and Medical Affairs unit, after taking it on an interim basis in January 2014.

The news comes at a time when Novartis AG is trying to consolidate its cancer unit by purchasing the cancer business of its U.K.-based competitor GlaxoSmithKline Plc in a deal estimated to about 14.5 billion dollars. When the acquisition is finalized, about one fifth of Novartis AGs 54-billion-dollar annual revenue will be generated from the sales of cancer drugs.

A great variety of products from the cancer portfolio of GlaxoSmithKline Plc were sold to Novartis in April this year. The deal with GSK is the most significant one that Novartis has sealed so far. The company has been recently trying to consolidate its overall performance, but the acquisition was beneficial for GlaxoSmithKline, too, because it provided it with the opportunity to restructure its units in an attempt to increase its growth.

As the Chief Executive of GlaxoSmithKline – Sir Andrew Witty said in an interview for the Financial Times in April this year: “M&A is a strategy to be used sparingly. But it has an extremely valuable role to play if you can find targeted transactions that allow you to strengthen in areas where you have long-term competitive advantages.”

Currently, cancer treatments have become a desired target for a great number of drug manufacturers, who are trying to improve their positions in oncology. In May 2014, Novartis AG sealed a deal with Sun Pharmaceuticals Industries Ltd, which is based in India.

Novartis AG was losing 0.44% to trade at 79.95 Swiss francs per share by 12:19 GMT, marking a one year change of +15.87%.