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The drugmaker is exploring different options to retain its position in the mainstream pharmaceutical space

Novartis AG (ADR) (NYSE:NVS) is currently going through an era of patent expiration as patents of its blockbuster drug Gleevec has expired, leading to a revenue dip. Investors are a bit confused regarding the future of the company and the strategy it would follow from here on. Novartis shares tanked 7.44% year-to-date through Monday, materially underperforming the 3.04% decline of the NYSE ARCA Pharmaceutical Index (DRG).

The drugmaker is working on different options to regain its previous position in the pharmaceutical space. The US Food and Drug Administration designated the company’s investigational molecule LEE011 to be prescribed as first-line therapy for advanced breast cancer.

Gleevec, the company’s cancer drug, lost patent protection in early 2016, and has since been exposed to generics which are much cheaper and provide similar safety and efficacy. The drug had $4.7 billion in sales last year, and by 2020, it is expected to rake in only $550 million in sales. Diovan, its high blood pressure and heart failure treatment, also saw sales plunge to $1.28 billion last year from $5.7 billion four years ago.

The miseries of the company are increasing day by day as its expected heart failure molecule, Entresto, did not show the expected results after its launch. Analysts expected the drug to generate $8 billion this year, but it only clinched $17 million for the first quarter of fiscal year 2016.

Novartis CEO Joseph Jimenez stated: “The environment in which we operate is changing, and we are positioning Novartis to thrive in this environment. Our strategy is to sharpen our focus in areas where we are strongest; ensure that we have the global scale to compete profitably across geographies; and have the innovation power to address unmet medical needs.” He added that the company has been working on different drugs which are currently in its pipeline, such as psoriasis drug Cosentyx® and Entresto®.

With the segregation of the business into Novartis Pharmaceuticals and Novartis Oncology, the company has an excellent opportunity to handle the businesses individually in terms of decision making, marketing, and product commercialization.