Novartis Wins Full FDA Nod For Fabhalta And Wider EU Itvisma Use

What happened

The US Food and Drug Administration granted traditional approval for Fabhalta (iptacopan) to slow kidney function decline in adults with primary IgA nephropathy who are at risk of disease progression. IgA nephropathy is a kidney disease that can lead to progressive loss of kidney function. This full approval follows an earlier accelerated approval pathway and confirms the treatment's clinical benefit in slowing disease progression. The regulatory milestone comes as Novartis continues to advance its priority medicines portfolio, which includes other key therapies such as Kisqali, Pluvicto, Kesimpta, Leqvio, and Scemblix. Fabhalta is part of Novartis' broader strategic focus on high-innovation pharmaceuticals targeting serious diseases with significant unmet medical needs.

Why it matters

Traditional FDA approval for Fabhalta strengthens Novartis' position in the nephrology market and supports the company's strategy to offset expected revenue losses from upcoming patent expirations on blockbuster medicines such as Cosentyx and Kisqali around the turn of the decade. The approval validates Novartis' investment in advanced therapies and biologics, areas management has prioritised as core growth drivers. Full approval typically expands commercial access and reimbursement opportunities compared with accelerated approval, potentially increasing Fabhalta's sales trajectory. For investors, this regulatory win reinforces confidence that Novartis' pipeline investments are translating into approved products that can drive future earnings growth. The approval also demonstrates progress on key therapies including remibrutinib, Fabhalta, and ianalumab, which analysts view as critical to the company's long-term growth trajectory beyond minor quarterly earnings fluctuations.

Bigger picture

The Fabhalta approval arrives as Novartis navigates what CEO Vas Narasimhan has described as the largest patent expiry period in the company's history. Sales of heart drug Entresto, already facing generic competition, are expected to drop by $4 billion this year, while Cosentyx and Kisqali face patent losses around the turn of the decade. To offset these declines, Novartis is advancing multiple experimental medicines with estimated peak annual sales potential exceeding $10 billion collectively, including pelacarsen in cardiovascular disease, remibrutinib in multiple sclerosis, and del-desiran in genetic disorders. Regulatory progress on medicines like Fabhalta supports management's confidence that aggressive R&D spending during this transition period will deliver tomorrow's product launches. Novartis' premium valuation of approximately 16 times forward earnings reflects investor expectations that the pipeline will deliver sustained growth, but analysts warn that maintaining this multiple requires successful clinical readouts and continued commercial momentum from priority medicines.

What to watch

Investors should monitor sales momentum for Fabhalta and other priority medicines including Kisqali, Pluvicto, Kesimpta, Leqvio, and Scemblix to assess whether exceptional growth rates can be sustained. Three major drug trial readouts expected in the second half of the year-pelacarsen for cardiovascular disease, remibrutinib for multiple sclerosis, and del-desiran for genetic disorders-are seen as vital to justifying Novartis' valuation and shaping the company's growth outlook into the next decade. Analysts suggest at least two of the three trials need to succeed to support the current 16 times forward earnings multiple. Management commentary on second-half 2026 guidance will be important, particularly any indication that stronger growth remains on track as comparisons become easier after the initial wave of generic competition. Finally, watch for updates on how the Most Favored Nation pricing policy affects Novartis' launch strategy, as management has warned the full impact could become visible over the next 18 months, potentially influencing where and when the company launches new medicines globally.