COVER SECTION Industry Update
Getting into the Driver’s Seat with the New Alcon
by Matt Young and Brooke Herron
To win the race, you’ve got to split from the pack. On April 9, 2019, global ophthalmic device leader Alcon announced its separation from Novartis. This independence gives Alcon more ‘steering’ control . . . and more opportunities for growth. Below, we ‘hitch a ride’ with Alcon — in this racing-themed edition of CAKE — to see how it is shifting gears and driving the industry.
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ust as cars and teams in motorsports have sponsors, so did Alcon, which had two ‘sponsors’ through the years: Nestle and the more recent, Novartis — but not anymore. In an interview with Mr. Raj Narayanan, Alcon’s Asia Pacific Regional President, he explained the difference between how medical device companies like Alcon and pharmaceutical companies like Novartis work. Mr. Narayanan, who is now transitioning to the Alcon headquarters in Geneva, sat down with CAKE
Magazine at Alcon’s regional office in Singapore to keep us ‘up to speed’ with the transition. Speaking from both personal and professional experience — Mr. Narayanan is a great person to explain how Alcon’s transition from Novartis will roll out. “Big pharma is all about blockbusters, they have long development timelines, and the pace at which things move is different for all the right reasons,” he explained. “With medical devices, it’s small, incremental innovation . . . it is much more agile and the interactions with the customers are very different.” Mr. Narayanan said the spin-off allows Alcon to operate as a medical device company, without the constraints of being part of a larger parent company. Ultimately, this will translate to better customer support. And now that Alcon has returned to its roots as an independent company, it can steer its own course in investments and decision-making. “Going forward, we can make the right decisions for our business and allocate capital in the most appropriate
way,” added Mr. Narayanan. “We realize that we have a once-in-a-lifetime opportunity to create a truly world-class medical device technology company in ophthalmology.” According to him, this transition is fueled by dedication to the following tenets: agility, simplification, accountability, and empowering the company’s 20,000-plus employees. Now in pole position, Alcon is driving its own resource and capital allocations to fuel opportunities for growth.
Leaderboard Stats Eye care boasts an approximately $23 billion annual market, growing at roughly 4% each year. Last year, Alcon had sales of $7.1 billion, including $4.0 billion in surgical (up 7% from the prior year), and $3.1 billion in vision care (up 3%). Looking ahead, Alcon plans to build on its core strengths to earn lowto mid-single digit net sales growth in 2019 and accelerating to mid-single digit sales growth over the next five
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June/July 2019
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