Novartis shareholder urges board overhaul after costly Avidity acquisition setbacks

Novartis investor David Samra, managing director at Artisan Partners, told Reuters that the company’s board should be reshaped to improve oversight of its dealmaking activities. He said the board needs to tighten control over the team that negotiates acquisitions, which he described as uninspiring.

Samra’s comments came after Novartis reported two clinical failures, including the loss of efficacy for del-desiran, the lead asset from its $12 billion purchase of Avidity Biosciences, in a rare muscle-wasting disease. While the drug has not been completely abandoned, the setback raised questions about the overall value of the Avidity deal.

The news sent Novartis shares down more than 10%, erasing roughly $30 billion from its market value. Analysts highlighted concerns that the acquisition may not deliver the expected return, especially as the company pushes into RNA therapeutics and neuromuscular disease.

The shareholder’s call for board changes reflects broader investor anxiety about the company’s strategy and execution of large-scale deals.