On Thursday, Novartis announced its intent to separate its generics and biosimilars division, Sandoz, into a new publicly traded standalone company by way of a 100% spin-off (turning a subsidiary into a new and separate company)

As per the company’s press statement, the spin-off is aimed at maximising shareholder value by creating a European generics company and a global leader in biosimilars (biopharmaceutical drugs designed to have active properties similar to those of a drug that has previously been licensed).

This will likely allow Novartis shareholders to participate fully in the potential future upside for both Sandoz and Novartis Innovative Medicines. The company asserted that the spin-off would enable enhanced focus and the ability to pursue independent growth strategies. Sandoz may deliver the next wave of growth based on the existing biosimilars pipeline of 15+ molecules.

Novartis is a Swiss-American multinational pharmaceutical corporation and one of the largest pharmaceutical companies in the world. Founded in 1996, it aims to become a focused innovative medicines company with a stronger financial profile and improved return on capital. Vasant Narasimhan is its current CEO.