Novartis with dynamic growth in the 2007 first quarter

* Strong 2007 first quarter performance: * Group net sales advance 18% (+15% in local currencies) to USD 9.8 billion based on excellent performances from all divisions * Operating income up 11% thanks to business expansion; increase is at a lower rate than net sales primarily due to one-time divestment gain in 2006 first quarter * Net income up 11% to USD 2.2 billion and EPS rises 11% to USD 0.92 per share * Group continuing operations operating income up 18% and net income up 17% * Four important new regulatory approvals received in first quarter, significant progress in achieving multiple new product launches in 2007-2008 * Q1 approvals include Tekturna (hypertension - US), Lucentis (blindness - EU), Exforge (hypertension - EU) and Sebivo (hepatitis B - China) * Completion of strategic positioning on healthcare with pharmaceuticals at the core * Novartis expects record 2007 operating and net income on a continuing basis and reaffirms outlook for Group net sales growth of above five percent in local currencies Key Group figures First quarter +-------------------------------------------------------------------+ | | Q1 2007 | Q1 2006 | % | | | | | Change | |----------------------+---------------+---------------+------------| | | | % of | | % of | | | | | | net | | net | | | | | USD m | sales | USD m | sales | USD | lc | |----------------------+-------+-------+-------+-------+------+-----| | Net sales | 9 819 | | 8 301 | | 18 | 15 | |----------------------+-------+-------+-------+-------+------+-----| | Operating income | 2 453 | 25.0 | 2 202 | 26.5 | 11 | | |----------------------+-------+-------+-------+-------+------+-----| | Net income | 2 171 | 22.1 | 1 956 | 23.6 | 11 | | |----------------------+-------+-------+-------+-------+------+-----| | Basic earnings per | USD | | USD | | 11 | | | share/ADS | 0.92 | | 0.83 | | | | +-------------------------------------------------------------------+ Basel, April 23, 2007- Commenting on the results, Dr. Daniel Vasella, Chairman and CEO of Novartis, said, "I am pleased with the strong start, enhanced by several new approvals for innovative medicines that address important unmet medical needs. All divisions, particularly Pharmaceuticals and Sandoz, delivered excellent performances. We have now completed the divestments of non-core businesses as part of our long-term strategy to focus on healthcare, and we will continue to invest vigorously into R&D to offer a continuously novel range of medicines. I am confident of another year of record sales and earnings in 2007." First quarter 2007 net sales +-------------------------------------------------------------------+ | | Q1 2007 | Q1 2006 | % Change | |-------------------------------+---------+---------+---------------| | | USD m | USD m | USD | lc | |-------------------------------+---------+---------+--------+------| | Pharmaceuticals | 5 923 | 5 052 | 17 | 14 | |-------------------------------+---------+---------+--------+------| | Vaccines and Diagnostics | 231 | | | | |-------------------------------+---------+---------+--------+------| | Sandoz | 1 696 | 1 431 | 19 | 12 | |-------------------------------+---------+---------+--------+------| | Consumer Health continuing | 1 721 | 1 574 | 9 | 6 | | operations | | | | | |-------------------------------+---------+---------+--------+------| | Net sales from continuing | 9 571 | 8 057 | 19 | 15 | | operations | | | | | |-------------------------------+---------+---------+--------+------| | Consumer Health discontinuing | 248 | 244 | | | | operations(1) | | | | | |-------------------------------+---------+---------+--------+------| | Total | 9 819 | 8 301 | 18 | 15 | +-------------------------------------------------------------------+ (1) Discontinuing operations include Medical Nutrition in 2007 and both Medical Nutrition and Nutrition & Santé in 2006. Gerber is not yet reflected as a discontinuing operation as the divestment was only agreed on April 12, 2007. Group net sales up 18% (+15% lc) to USD 9.8 billion Contributions from all divisions, particularly Pharmaceuticals and Sandoz, supported the double-digit improvement. Higher sales volumes accounted for ten percentage points of growth and acquisitions for five percentage points, while currency translation had a positive impact of three percentage points. Net price changes had no impact. Net sales from continuing operations were up 19%. Pharmaceuticals net sales advance 17% (+14% lc) to USD 5.9 billion The two top-selling medicines - Diovan (USD 1.2 billion, +20% lc) and Gleevec/Glivec (USD 674 million, +16% lc) - led the strong underlying performance. Rapid growth also came from Femara (USD 208 million, +32% lc) and from recently launched products, particularly Xolair, Exjade, Lucentis and Prexige. The US gained further market share, with net sales up 18% to USD 2.5 billion. Improving performances in Germany and France underpinned the 22% (+13% lc) increase in Europe. In Japan, net sales growth of 7% (+9%lc) was supported by Diovan. Latin America net sales rose 20% (+19% lc), led by Mexico and Brazil. Vaccines and Diagnostics net sales of USD 231 million Net sales rose 47% over the 2006 period reported by Chiron on higher sales of tick-borne encephalitis vaccines and increased deliveries of components for use in multivalent pediatric vaccines (including Quinvaxem(TM) collaboration with Crucell). Diagnostics benefited from geographic expansion and US approval of West Nile Virus tests used in blood banks. Sandoz net sales rise 19% (+12% lc) to USD 1.7 billion Retail generic sales in the US expanded 27% in the quarter, driven primarily by recent product launches - particularly difficult-to-make products - that contributed about one-third of US quarterly net sales. Strong performances in Germany, Eastern Europe, Canada and Mexico further supported the double-digit expansion. Consumer Health continuing operations net sales up 9% (+6% lc) to USD 1.7 billion OTC generated double-digit growth from strategic brands, expansion in emerging markets and strong growth in Japan, the world's No. 2 OTC market. CIBA Vision benefited from improved lens care product supplies and made progress in improving supplies of contact lens after a shortage at the end of 2006. First quarter 2007 operating income +-------------------------------------------------------------------+ | | Q1 2007 | Q1 2006 | Change | |--------------------------+---------------+---------------+--------| | | | % of | | % of | | | | | net | | net | | | | USD m | sales | USD m | sales | In % | |--------------------------+-------+-------+-------+-------+--------| | Pharmaceuticals | 1 853 | 31.3 | 1 626 | 32.2 | 14 | |--------------------------+-------+-------+-------+-------+--------| | Vaccines and Diagnostics | 27 | 11.7 | | | | |--------------------------+-------+-------+-------+-------+--------| | Sandoz | 318 | 18.8 | 238 | 16.6 | 34 | |--------------------------+-------+-------+-------+-------+--------| | Consumer Health | | | 314 | | | | continuing operations | 329 | 19.1 | | 19.9 | 5 | |--------------------------+-------+-------+-------+-------+--------| | Corporate income & | | | -120 | | | | expense, net | -103 | | | | | |--------------------------+-------+-------+-------+-------+--------| | Operating income from | | | | | | | continuing operations | 2 424 | 25.3 | 2 058 | 25.5 | 18 | |--------------------------+-------+-------+-------+-------+--------| | Consumer Health | | | | | | | discontinuing | | | | | | | operations(1) | 29 | | 144 | | | |--------------------------+-------+-------+-------+-------+--------| | Total | 2 453 | 25.0 | 2 202 | 26.5 | 11 | +-------------------------------------------------------------------+ (1) Discontinuing operations include Medical Nutrition in 2007 and both Medical Nutrition and Nutrition & Santé in 2006. Gerber is not yet reflected as a discontinuing operation as the divestment was only agreed on April 12, 2007. The 2006 results include a pre-tax divestment gain of USD 129 million from the sale of Nutrition & Santé. Group operating income advances 11% to USD 2.5 billion Operating income rose at a strong pace as Pharmaceuticals and Sandoz delivered excellent performances that included operational improvements and contributions from new product launches. For continuing operations, Group operating income advanced 18%, roughly in line with net sales growth. Pharmaceuticals operating income rises 14% to USD 1.9 billion Reflecting the strong business expansion, operating income grew at a double-digit pace, which resulted in an operating margin of 31.3%. R&D investments rose to 20.5% of net sales as more compounds moved into Phase III trials compared to 2006. Marketing & Sales investments rose 18%, but productivity gains partially offset the rising investments to support new product launches. A one-time charge of USD 52 million was taken in the 2007 first quarter for sales returns and additional expenses related to the temporary suspension of Zelnorm sales in the US. Also during the quarter, one-time income of USD 107 million was recognized from a pre-launch inventory provision that was reversed following the US approval of Tekturna in March 2007. The year-ago period included one-time gains of USD 87 million from product divestments. Excluding these one-time gains and expenses in both quarters, operating income rose 17% and the operating margin was 30.4%. Vaccines and Diagnostics operating income of USD 27 million Operating income was USD 98 million before acquisition-related amortization charges of USD 71 million. The reported operating income included a one-time contribution of USD 67 million from a legal settlement, of which USD 59 million was reported as royalty income in Other Revenues. Sandoz operating income climbs 34% to USD 318 million The strong business expansion driven by new product launches led to the double-digit improvement, which was further supported by productivity gains, economies of scale in key markets and synergies from recent acquisitions. These factors more than offset significant investments into new product development and registration, the build-up of sales forces in emerging markets and price erosion driven by regulatory changes, namely in Germany and other European markets. Consumer Health operating income from continuing operations rises 5% to USD 329 million Higher investments in R&D and marketing for new product launches across the division weighed on the performance, which was also affected by increased marketing and sales efforts to better penetrate key markets, including entries into new geographic areas. Corporate Income from associated companies Income from associated companies amounted to USD 97 million in the first quarter, roughly equal with a contribution of USD 104 million in the prior-year period. The investment in Roche provided USD 96 million compared to USD 66 million in the 2006 quarter. The 44% interest in Chiron prior to the full acquisition and consolidation in April 2006 was still accounted for in the 2006 quarter as an associated company and contributed USD 33 million during that period. Financial income, net Net financial income amounted to USD 34 million, a decline of USD 16 million compared to income of USD 50 million in the year-ago quarter, reflecting the drop in average net liquidity to fund acquisitions. During the first quarter, average net liquidity was USD 850 million compared to USD 3.2 billion in the year-ago quarter. However, excellent currency management boosted the average return on net liquidity to 16.0% per year, up from 6.3% per year in the 2006 first quarter. Group net income advances 11% to USD 2.2 billion Group net income grew at a double-digit rate in 2007, but rose 17% for continuing operations in line with the expansion in net sales and operating income. Balance sheet The Group's equity fell slightly to USD 40.5 billion at March 31, 2007 compared to USD 41.3 billion at December 31, 2006. The decline of USD 0.8 billion was principally due to the dividend of USD 2.6 billion and share repurchases of USD 0.8 billion, which was only partially offset by net income in the first quarter. Total liquidity amounted to USD 7.0 billion at March 31, 2007, down from USD 8.0 billion at the beginning of the year. The debt/equity ratio remained unchanged at 0.18:1 compared to the end of 2006. Novartis is one of the few non-financial services companies worldwide to have attained the highest credit ratings from Standard & Poor's, Moody's and Fitch, the three benchmark rating agencies. S&P has rated Novartis as AAA for long-term maturities and as A1+ for short-term maturities. Moody's has rated the Group as Aaa and P1, respectively, while Fitch has rated Novartis as AAA for long-term maturities and as F1+ for short-term maturities. Cash flow Cash flow from operating activities from continuing operations was USD 2.2 billion, an increase of USD 0.1 billion from the year-ago period despite higher working capital requirements to support the organic business expansion. Net cash used in financing activities was USD 2.5 billion, mainly for the 2006 dividend payment of USD 1.8 billion (excluding USD 0.8 billion due to withholding tax to be paid in the 2007 second quarter), the purchase of USD 0.8 billion of treasury shares and other net financing cash flow movements of USD 0.1 billion. Total Group free cash outflow after dividends was USD 256 million compared to a free cash inflow of USD 373 million in the year-ago period. Novartis completes strategic concentration on healthcare Novartis has consistently strengthened its focus on innovation and healthcare businesses during the last decade, creating a portfolio led by pharmaceuticals to address the needs of patients, physicians and society in a dynamically changing healthcare environment. This strategic repositioning on healthcare - which has included the divestments of over 50% of non-core businesses during the last decade - has been completed following the signing of a definitive agreement to sell the Gerber baby foods business in April 2007. This transaction, along with the pending sale of the Medical Nutrition business announced in December 2006, requires customary regulatory approvals and is expected to be completed in 2007. All Novartis businesses activities are now concentrated on healthcare, areas where the Group has expertise and synergies in addressing the needs of customers. These include innovative pharmaceuticals for human and animal health, vaccines, generics and consumer health products such as over-the-counter (OTC) brands and diagnostics. Novartis intends to invest proceeds from recent divestments into its operations, particularly into research and development. Strategic options will also be considered that would strengthen the competitiveness of these businesses, all of which have been improving their leadership positions through dynamic organic growth and targeted acquisitions. The Group's policy for its share repurchase program remains unchanged. In the absence of acquisitions, this policy calls for allocating up to half of free cash flow after the payment of dividends for the repurchase of shares. Group outlook (For continuing operations, barring any unforeseen events) Novartis revised its 2007 net sales outlook on March 30 when announcing it would comply with a request from the US Food and Drug Administration (FDA) to suspend the US marketing and sales of Zelnorm to allow for the review of cardiovascular safety data. Due to this suspension, the revised expectations take into account a reduction in net sales of more than USD 600 million for the rest of 2007. However, based on management actions to reallocate resources and accelerate ongoing productivity initiatives, and also in light of recent regulatory approvals for important new products such as Tekturna, Lucentis and Exforge, Novartis reaffirms expectations for another year of record operating and net income in 2007 from continuing operations. The Group also reaffirms the revised 2007 outlook communicated on March 30 for net sales growth for continuing operations for the Group of above five percent and for the Pharmaceuticals division at a low- to mid-single-digit rate, both in local currencies. Pharmaceutical business and key product highlights Note: All growth figures refer to worldwide sales growth in local currencies Diovan (USD 1.15 billion, +20% lc), the leading angiotensin-receptor blocker by sales worldwide, again delivered solid growth and reaffirmed its position as one of the fastest-growing hypertension medicines. All regions delivered double-digit growth thanks to higher strength doses and greater use of Co-Diovan (fixed-dose combination with a diuretic). A 16% increase in Japanese sales was supported by results from the JIKEI study underscoring the efficacy of Diovan in reducing the risk of cardiovascular events. Gleevec/Glivec (USD 674 million, +16% lc), a targeted treatment used primarily in patients with certain forms of chronic myeloid leukemia (CML) and gastrointestinal stromal tumors (GIST), grew rapidly despite new competition in both disease areas. Growth was driven mostly by increased survival of CML and GIST patients, expansion of the GIST market as well as new indications approved for various rare diseases. Positive interim data made public in April showed GIST patients treated after surgery with Gleevec/Glivec were significantly less likely to experience a return of their cancer over those not taking this medicine. Global submissions are planned. Lotrel (USD 353 million, +20% only in US), the leading fixed-dose combination treatment for hypertension in the US, has benefited from growing use of multiple therapies to help patients reach treatment goals. Zometa (USD 314 million, -4% lc), an intravenous bisphosphonate for patients with bone cancer, was negatively impacted by an overall slowing of its market segment in the US and Europe. However, Zometa has gained market share in treating patients with lung and prostate cancer and has benefited from growth in Japan. Femara (USD 208 million, +32% lc), a leading oral treatment for women with hormone-related breast cancer, remained a key growth driver for Novartis thanks to ongoing market share gains, especially in the use of this agent in women who have undergone surgery (early adjuvant), in the highly competitive segment for aromatase inhibitors. Lamisil (USD 207 million, +2% lc), an oral treatment for fungal nail infections, expanded sales in the US at a double-digit rate, but was partially offset by generic competition in Japan since mid-2006. Generic competition in the US is expected in mid-2007. Trileptal (USD 197 million, +17% lc), a treatment for epilepsy seizures, generated strong growth in Europe and Latin America in addition to the US, where this product is expected to face potential generic competition during the course of 2007. Zelnorm/Zelmac (USD 105 million, -3% lc), a treatment for irritable bowel syndrome and chronic constipation, has been suspended from marketing and sales in the US to comply with a request from the FDA to review recent cardiovascular safety data. This product has also been suspended in seven other countries worldwide. Novartis believes Zelnorm/Zelmac provides important benefits for appropriate patients and will continue working with the FDA and health authorities in other countries to secure access for these patients. Exjade (USD 65 million), the first once-daily oral iron chelator for chronic iron overload, grew rapidly based on its approval in more than 80 countries as a new treatment for iron overload associated with various blood disorders. During the first quarter, Exjade was submitted for approval in Japan, more than one year ahead of schedule. Xolair (USD 34 million), for moderate to severe allergic asthma, has now been launched in over 20 countries following EU approval in October 2005, with approvals now received in over 50 countries. In the US, Novartis co-promotes Xolair with Genentech and shares a portion of operating income. Xolair had first quarter net sales of USD 111 million in the US, resulting in a contribution to Novartis of USD 38 million reported as Other Revenues. Lucentis, for the eye disease "wet" age-related macular degeneration, is being launched in Europe after approval in January 2007. Reimbursement negotiations are underway in key European markets. Lucentis is now available in 36 countries (including Switzerland) as the first and only treatment proven to maintain and improve vision in patients with wet AMD, which is the leading cause of blindness in people over age 50. Genentech holds the US rights. Prexige (lumiracoxib), an oral COX-2 inhibitor approved in more than 40 countries, has gained market share in the eight countries where it has been launched, including Mexico and Germany. It was resubmitted in March for US approval as an effective treatment option for patients suffering from osteoarthritic pain of the knee and hip. The EU approval in November 2006 was based on data from clinical trials involving more than 34,000 patients - one of the largest bodies of evidence supporting the launch of an anti-inflammatory agent. Novartis pipeline and regulatory update With 138 projects in pharmaceutical development, Novartis has one of the industry's most promising pipelines amid plans for multiple new product approvals and launches over the next two years. Several of these anticipated approvals are for potentially best-in-class medicines that would advance treatment standards. Novartis received four important new regulatory approvals during the 2007 first quarter, making significant progress in its goal of achieving multiple new product launches in 2007 and 2008 to support longer-term growth. These include the approval and launch of the high blood pressure medicine Tekturna in the US along with the approval of Exforge in Europe. Also approved were the eye therapy Lucentis in Europe and Sebivo in China for hepatitis B. However, the FDA issued an "approvable letter" for the diabetes treatment Galvus, delaying the potential approval of this investigational medicine. Beyond these recent approvals, key compounds are already in or are moving into late-stage trials. Priority late-stage compounds include FTY720 (multiple sclerosis), QAB149 (respiratory diseases), AGO178 (depression), RAD001 (cancer), ABF656 (hepatitis C) and SOM230 (Cushing's disease). Among the recent developments: * Tekturna/Rasilez[1] (aliskiren), the first new type of high blood pressure medicine in more than a decade, was launched in the US after receiving regulatory approval in March. Known as Tekturna in the US and Rasilez elsewhere, it provides significant blood pressure reductions for a full 24 hours and is generally well tolerated. New data at the American College of Cardiology meeting in March showed Tekturna delivers important additional blood pressure lowering when combined with Diovan. Developed in collaboration with Speedel, Tekturna was submitted for EU approval in September 2006. * Exforge[1], a single tablet combining the angiotensin receptor blocker valsartan and the calcium channel blocker amlodipine, is being launched in European markets throughout 2007 and 2008 after gaining European Union approval in January. US launch plans are under review after the FDA granted tentative approval in December 2006. * Galvus (vildagliptin), in development as a new oral once-daily therapy for patients with type 2 diabetes, received an "approvable letter" from US regulators in February. Novartis is working with the FDA to agree on final actions needed to gain US approval. The FDA has requested additional data, including a clinical study to demonstrate the safety and efficacy of Galvus in specific patient groups with renal (kidney) impairment. Galvus was submitted for US approval in January 2006 to reduce blood sugar levels in patients with type 2 diabetes, both as a monotherapy and when used with other medicines. The global clinical trial program to date has included over 8,000 patients, with some 5,500 treated with Galvus. EU submission was made in August 2006. * Aclasta/Reclast (zoledronic acid), submitted for regulatory approvals as a once-yearly bisphosphonate infusion for various bone-related diseases, received US approval in April as the first new treatment in nearly a decade for patients with Paget's disease of the bone. This indication is already approved in more than 50 countries, including key European markets. This medicine was submitted in late 2006 for approval in the US and Europe as a once-yearly infusion for women with postmenopausal osteoporosis. * Sebivo/Tyzeka (telbivudine), a new oral therapy for hepatitis B, was approved in China - where more than half a million deaths each year are linked to this viral disease - and also Australia. European Union approval is expected in the second quarter of 2007 after an EU regulatory agency recommended approval in February. Sebivo has now been approved in 15 countries, including the US where it is marketed as Tyzeka. Novartis shares the rights for this product with Idenix Pharmaceuticals. * Mycograb, an antifungal compound acquired with NeuTec in 2006, received a EU recommendation against approval in March 2007 due to manufacturing concerns based on a 2005 submission made by NeuTec. Mycograb is being developed for the treatment of life-threatening fungal infections. Novartis is moving production of this drug in-house, and further work will be conducted to support the resubmission for approval. * Tasigna (nilotinib) is awaiting decisions this year from US, EU and Swiss regulatory agencies for use as a new treatment option in patients with certain forms of chronic myeloid leukemia who have developed resistance and/or intolerance to Gleevec/Glivec, a Novartis medicine. Both Tasigna and Gleevec/Glivec inhibit Bcr-Abl, the definitive cause of Philadelphia chromosome-positive chronic myeloid leukemia (Ph+ CML). Tasigna was designed to be a more selective inhibitor of Bcr-Abl and its mutations. * ABF656 (albumin interferon alpha-2b), a longer-acting interferon targeting hepatitis C, has enrolled the first patients in Phase III trials. Interim results from Phase II trials, in which treatment-naïve patients received ABF656 in combination with ribavirin, showed it has the potential for improved efficacy and tolerability with the need for fewer injections compared to pegylated interferon, the current standard of care. Hepatitis C is a potentially fatal liver disease caused by a chronic viral infection estimated to affect more than 170 million patients worldwide. The first regulatory submission is planned for 2009. Novartis and Human Genome Sciences will co-promote ABF656 in the US, while Novartis will have exclusive rights in the rest of the world. * PTK787, an oral angiogenesis inhibitor, has completed trials in advanced colorectal cancer during the first quarter. Final results from the CONFIRM 1 and 2 studies showed PTK787 did not achieve the overall survival endpoint in either study, confirming previously reported interim results on progression-free survival. With its co-developer, Novartis is evaluating options for PTK787, which has been removed from the Novartis near-term submission/launch schedule. Disclaimer This release contains certain forward-looking statements relating to the Group's business, which can be identified by the use of forward-looking terminology such as "expects", "outlook", "long-term strategy", "will", "confident", "expected", "intends", "would", "expectations", "expected", "potential", "believes", "pipeline", "development", "plans", "potentially", "would", "goal", "estimated", "planned", or similar expressions, or by express or implied discussions regarding potential future revenues from any particular products, or potential future sales or earnings of the Novartis Group or its Pharmaceuticals Division; potential new products, or potential new indications for existing products, or regarding potential future revenues from such products; or by discussions of strategy, plans, expectations or intentions. Such statements reflect the current views of management with respect to future events and are subject to certain known and unknown risks, uncertainties, assumptions and other factors that may cause actual results to be materially different from any future results, performance or achievements expressed or implied by such statements. There can be no guarantee that any particular products will reach any particular sales levels. Neither can there be any guarantees that the Novartis Group, or the Pharmaceuticals Division, will achieve any particular financial results. Nor can there be any guarantee that any new products will be approved for sale in any market, or that any new indications will be approved for existing products in any market, or that they will achieve any particular revenue levels. In particular, management's expectations could be affected by, among other things, uncertainties involved in the development of new pharmaceutical products, including unexpected clinical trial results; unexpected regulatory actions or delays or government regulation generally; the Group's ability to obtain or maintain patent or other proprietary intellectual property protection; competition in general; government, industry, and general public pricing and other political pressures; and other risks and factors referred to in the Group's current Form 20-F on file with the US Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated or expected. Novartis is providing the information in this press release as of this date and does not undertake any obligation to update any forward-looking statements contained in this press release as a result of new information, future events or otherwise. About Novartis Novartis AG (NYSE: NVS) is a world leader in offering medicines to protect health, cure disease and improve well-being. Our goal is to discover, develop and successfully market innovative products to treat patients, ease suffering and enhance the quality of life. We are strengthening our medicine-based portfolio, which is focused on strategic growth platforms in innovation-driven pharmaceuticals, high-quality and low-cost generics, human vaccines and leading self-medication OTC brands. Novartis is the only company with leadership positions in these areas. In 2006, the Group's businesses achieved net sales of USD 37.0 billion and net income of USD 7.2 billion. Approximately USD 5.4 billion was invested in R&D. Headquartered in Basel, Switzerland, Novartis Group companies employ approximately 100,000 associates and operate in over 140 countries around the world. For more information, please visit http://www.novartis.com. Further important dates July 17, 2007 First-half and second quarter 2007 results September 12, 2007 Novartis Business Review for investors October 18, 2007 Nine-month and third quarter 2007 results [1] Brand name awaiting regulatory approval in certain markets All product names appearing in italics are trademarks owned by or licensed to Novartis Group Companies Please find full media release in English attached and on the following link: http://hugin.info/134323/R/1120500/206008.pdf Further language versions are available through the following links: German version is available through the following link: http://hugin.info/134323/R/1120502/206012.pdf French version is available through the following link: http://hugin.info/134323/R/1120503/206009.pdf --- End of Message --- Novartis International AG Posfach Basel WKN: 904278; ISIN: CH0012005267; Index: SLCI, SMI, SPI, SLIFE; Listed: Main Market in SWX Swiss Exchange, ZLS in BX Berne eXchange;