Novartis Fails to Block MSN Generic of Entresto, Bloomberg Reports

Novartis has lost its bid to block a generic version of Entresto, a heart failure treatment, according to Bloomberg. The generic, made by MSN, is expected to enter the market soon. Novartis has been trying to protect its patent for Entresto, which has been a major contributor to the company's revenue.

Novartis has lost its bid to block a generic version of Entresto, a heart failure treatment, according to Bloomberg. The generic, made by MSN, is expected to enter the market soon. Novartis has been trying to protect its patent for Entresto, which has been a major contributor to the company's revenue.

The Delaware federal court's rejection of Novartis' bid to block MSN's generic Entresto marks a seismic shift in the $7.8 billion heart failure drug's market trajectory [3]. By upholding that MSN's formulation does not infringe U.S. Patent No. 11,096,918—a claim Novartis had weaponized to delay generic competition—the ruling accelerates the erosion of Entresto's patent-protected monopoly. This legal defeat, compounded by the expiration of pediatric exclusivity on July 15, 2025, and the looming threat of Medicare price caps under the Inflation Reduction Act (IRA), creates a perfect storm for Novartis (NVS). Investors must now confront the reality that Entresto's golden era is ending faster than anticipated.

The Delaware court's July 2025 ruling exposed critical flaws in Novartis' litigation strategy. The '918 patent, which Novartis argued covered the amorphous solid form of sacubitril-valsartan, was deemed inapplicable to MSN's crystalline formulation. This distinction—a technicality in drug chemistry—carries monumental financial stakes. The court's narrow interpretation highlights a broader vulnerability in pharmaceutical patent portfolios: overreliance on narrow, formulation-based claims. While Novartis won a partial victory on the '659 patent (covering treatment methods), that settlement only delayed generic entry until July 16, 2025. The subsequent denial of a stay and the Federal Circuit's refusal to intervene further underscored that Novartis' legal options are exhausted.

The stakes are existential. Entresto accounted for 11% of Novartis' 2024 revenue, and its sales are projected to drop sharply once generics flood the market. reveals a steady ascent, but the July 16, 2025, launch of MSN's generic could trigger a freefall. Analysts estimate a 50–70% sales decline by 2026, with generic competition slashing prices to as low as $20–$30 per prescription—down from Entresto's current ~$500 price tag. But the IRA adds a second, equally potent threat. Starting in 2026, Medicare will cap its share of drug costs at $2,000 annually for most high-priced medications. For Entresto, this means Novartis must now negotiate discounts even as generics undercut its pricing power. The combination of generic competition and price controls could reduce Entresto's peak sales by over $5 billion annually—a body blow to Novartis' bottom line.

The Delaware ruling crystallizes the investment case against Novartis: short NVS if generics enter by late 2025, targeting a 20–30% downside by year-end. Key catalysts include: 1. July 16, 2025: MSN's launch date, which will immediately trigger a supply chain shift to lower-cost generics. 2. Q4 2025 Earnings Reports: Novartis will likely report accelerating Entresto sales declines, with analysts revising revenue forecasts downward. 3. IRA Negotiation Deadlines: By early 2026, the price caps will force Novartis to accept Medicare's terms, further squeezing margins.

The stock has underperformed peers by 15% year-to-date amid litigation uncertainty, but the July ruling removes the “wait-and-see” premium. With the '918 patent's expiration in November 2026 still on the horizon, the near-term risk is that generics will capture 40–60% of the market by mid-2026, accelerating NVS's decline. Risk-Adjusted Opportunities: Timing Is Everything Investors should avoid complacency. While Novartis could appeal the Delaware decision—a process that might take 6–12 months—the odds of reversal are low given the court's technical reasoning. Even if Novartis wins a stay, the clock is ticking: the '918 patent's expiration in late 2026 ensures generics will dominate eventually. The safest play remains shorting NVS ahead of Q4 2025, when the market will fully price in generic competition.

References:
[1] https://www.ainvest.com/news/entresto-patent-cliff-navigating-risks-opportunities-cardiovascular-therapeutics-2507/
[2] https://www.tradingview.com/news/reuters.com,2025:newsml_L6N3T80M0:0-novartis-loses-bid-to-block-us-entresto-generic-through-2026/
[3] https://www.ainvest.com/news/entresto-patent-fallacy-novartis-faces-7-8b-revenue-tsunami-2507/