? Full year net sales for continuing operations1 up 9% (cc2, +6% USD):
o Pharmaceuticals BU growing 12% (cc) driven by Cosentyx USD 3.6 billion (+28% cc), Entresto
USD 1.7 billion (+71% cc) and Zolgensma USD 361 million
o Oncology BU growing 10% (cc) driven by Promacta/Revolade USD 1.4 billion (+23% cc), Kisqali
USD 0.5 billion (+111% cc) and Lutathera USD 0.4 billion (+160% cc)
o Sandoz sales grew 2% (cc, -1% USD) driven by Biopharmaceuticals
? Core2 operating income grew 17% (cc, +12% USD) and Innovative Medicines core margin improved
to 33.5% of sales, driven by sales momentum and productivity, while funding growth investments
? Free cash flow2 grew 15% to USD 12.9 billion mainly driven by higher operating income
? Net income from continuing operations declined 44% due to the one-time net gain from the sale
of the OTC JV in prior year, excluding this item net income was broadly in line with prior year
? Total Group net income was USD 11.7 billion, including the one-time effect from the Alcon spin-off
? Continued focusing Novartis as a leading medicines company:
o Alcon successfully spun-off, creating significant shareholder value. Following the spin-off, a onetime non-cash IFRS gain of USD 4.7 billion was recorded in discontinued operations
o The Medicines Company acquired, adding inclisiran a potentially transformative cholesterol-lowering therapy
o Xiidra acquired, strengthening ophthalmic pharmaceuticals portfolio
? Advanced transformation of Manufacturing and Business Services to optimize footprint and efficiencies
? 2019 breakthrough innovation milestones:
o Five NME approvals of potential blockbusters: Zolgensma, Piqray, Mayzent, Beovu and Adakveo
o Major submissions including: ofatumumab, inclisiran, capmatinib and Cosentyx in nr-axSPA
o Over 30 readouts supporting submission or enabling transition to Phase III
? Significant progress across ESG priorities including steps towards Carbon Neutrality by 2025
in our own operations; set ambitious 2020 ESG targets linked to compensation
? Dividend of CHF 2.95 per share, an increase of 4%, proposed for 2019
? 2020 guidance - Focused medicines company3 - Net sales expected to grow mid to high-single
digit (cc); core operating income expected to grow high-single to low double digit (cc)
Basel, January 29, 2020 — Commenting on the results, Vas Narasimhan, CEO of Novartis, said:
“Novartis delivered an exceptional 2019. Strong sales growth drove double digit increases in core operating
income and free cash flow. Significant margin expansion puts us on track to reach mid to high 30s core
margin for Innovative Medicines in the mid-term. We launched an unprecedented 5 new molecular entities
in 2019 and advanced a breadth of early programs in our pipeline that address significant unmet needs.
Looking ahead, we expect to sustain our long-term growth and margin expansion driven by our in market
growth drivers and the 15 ongoing or upcoming major launches, while advancing our rich pipeline.”
Key figures2 Continuing operations1
Q4 2019 Q4 2018 % change FY 2019 FY 2018 % change
USD m USD m USD cc USD m USD m USD cc
Net sales 12 403 11 481 8 9 47 445 44 751 6 9
Operating income 1 823 1 362 34 37 9 086 8 403 8 14
Net income 1 129 1 220 -7 -6 7 147 12 800 -44 -41
EPS (USD) 0.50 0.53 -6 -4 3.12 5.52 -43 -40
Free cash flow 3 488 2 913 20 12 937 11 256 15
Core Operating income 3 462 3 112 11 13 14 112 12 557 12 17
Core Net income 2 985 2 681 11 13 12 104 10 920 11 15
Core EPS (USD) 1.32 1.16 14 15 5.28 4.71 12 17

1 Refers to continuing operations as defined on page 45 of the Condensed Financial Report, excludes Alcon, includes the businesses of Innovative Medicines and Sandoz (including the US generic oral solids and
dermatology portfolio), as well as the continuing corporate functions. 2 Constant currencies (cc), core results and free cash flow are non-IFRS measures. An explanation of non-IFRS measures can be found on
page 58 of the Condensed Financial Report. Unless otherwise noted, all growth rates in this Release refer to same period in prior year. 3 Removes Alcon and the Sandoz US dermatology and oral solids portfolio
from both 2019 and 2020. Forecast assumption that no Gilenya and Sandostatin LAR generics enter in 2020 in the US.

Strategy Update
During 2019, we continued focusing Novartis as a leading medicines company powered by advanced
therapy platforms and data science. We are now uniquely positioned with scale and diversification across
therapeutic areas and we continue to execute our five strategic priorities: embrace operational
excellence, deliver transformative innovation, go big on data and digital, build trust with society, and build
a new culture by unleashing the power of our people.
We successfully spun-off Alcon as a separate public company, creating significant value for our
shareholders. We acquired Xiidra, expanding our ophthalmic pharmaceuticals franchise, and in January
2020 we acquired The Medicines Company, adding inclisiran, a potentially transformational cholesterollowering therapy to address cardiovascular disease. Sandoz is in the process of becoming a more
autonomous and leaner division within Novartis, and returned to sales growth (cc) and margin expansion
in 2019 despite continued pricing pressure in the US.
Operationally, strong sales growth drove double digit growth in core operating income and free cash
flow. Innovative Medicines core margin increased by 1.8 percentage points (cc) to 33.5% of sales, and
we expect this margin to improve to the mid to high 30’s in the mid-term. Sales in China grew double
digit and we expect to double our China business by 2024.
2019 was a breakthrough innovation year for Novartis, with five NME approvals with blockbuster potential
including the first drug treatment for breast cancer with a PIKC3A mutation, the first oral drug to treat
aSPMS, the first gene therapy to treat SMA and next generation treatments for sickle cell disease and
wet AMD. Additionally we submitted regulatory filings for several major drugs, including inclisiran, and
we had over 30 readouts supporting submissions or enabling transition to Phase 3. Our pipeline remains
rich including many 2020 catalysts and we expect to maintain innovation momentum.
We are continuing our cultural journey and are seeing progress towards becoming more inspired, curious
and unbossed. We advanced an enterprise-wide digital transformation spanning the entire value chain,
from development to commercial operations. We continue our journey to rebuild trust with society based
on four pillars; ethical standards, pricing and access, global health and corporate citizenship. We have
introduced ESG targets for 2020 across these pillars which are transparent, systemically reviewed and
linked to compensation.
Financials
In order to comply with International Financial Reporting Standards (IFRS), Novartis has separated the
Group’s reported financial data for the current and prior years into “continuing” and “discontinued”
operations. The results of the Alcon business are reported as discontinued operations. See page 45 and
Notes 2, 3 and 11 in the Condensed Financial Report for a full explanation.

The commentary below focuses on continuing operations including the businesses of Innovative
Medicines and Sandoz (including the US generic oral solids and dermatology portfolio), as well as the
continuing Corporate functions. We also provide information on discontinued operations.
Continuing operations fourth quarter
Net sales were USD 12.4 billion (+8%, +9% cc) in the fourth quarter driven by volume growth of 13
percentage points, mainly from Entresto, Zolgensma, Cosentyx and Kisqali. Strong volume growth was
partly offset by the negative impacts of pricing (3 percentage points) and generic competition (1
percentage point).
Operating income was USD 1.8 billion (+34%, +37% cc) mainly driven by higher sales and divestments,
partly offset by growth investments, higher legal provisions and higher amortization.
Net income was USD 1.1 billion (-7%, -6% cc) due to higher taxes, including a one-time, non-cash deferred tax expense, partly offset by higher operating income. EPS was USD 0.50 (-6%, -4% cc), benefiting from lower weighted average number of shares outstanding.
Core operating income was USD 3.5 billion (+11%, +13% cc) mainly driven by higher sales, partly offset by growth investments. Core operating income margin was 27.9% of net sales, increasing by 0.8 percentage points (+0.8 percentage points cc).

Core net income was USD 3.0 billion (+11%, +13% cc) driven by growth in core operating income. Core
EPS was USD 1.32 (+14%, +15% cc) growing faster than core net income driven by lower weighted
average number of shares outstanding.
Free cash flow from continuing operations amounted to USD 3.5 billion (+20%) compared to USD 2.9
billion in the prior year quarter. The increase was mainly driven by higher cash flows from operating
activities and higher proceeds from the divestment of intangible assets.
Innovative Medicines net sales were USD 9.9 billion (+10%, +11% cc) in the fourth quarter.
Pharmaceuticals BU sales grew 14% (cc), driven by continued momentum on Entresto and Cosentyx
and the launch uptake of Zolgensma. Oncology BU grew 8% (cc) driven by continued momentum on
Kisqali and Kymriah and the launch uptake of Piqray. Volume contributed 15 percentage points to sales
growth. Generic competition had a negative impact of 2 percentage points. Net pricing had a negative
impact of 2 percentage points.
Sandoz net sales were USD 2.5 billion (+1%, +2% cc), driven by strong volume growth of 5 percentage
points partially offset by 3 percentage points of price erosion. Excluding the US, net sales grew strongly
(+8% cc). Global sales of Biopharmaceuticals grew to USD 425 million (+11% cc), mainly driven by
continued strong double-digit growth in Europe.
Novartis continues to expect the previously-announced divestment of the Sandoz US oral solids and
dermatology portfolio to be completed in Q1 2020, pending regulatory approval. Novartis remains fully
committed to this business until it is divested to Aurobindo. The results of this business are included in
continuing operations.
Continuing operations full year
Net sales were USD 47.4 billion (+6%, +9% cc) in 2019 driven by volume growth of 12 percentage points,
mainly from Cosentyx, Entresto and Zolgensma for the Pharmaceuticals BU and Promacta/Revolade,
Kisqali and Lutathera for the Oncology BU. Strong volume growth was partly offset by the negative impacts
of pricing (2 percentage points) and generic competition (1 percentage point).
Operating income was USD 9.1 billion (+8%, +14% cc) mainly driven by higher sales, higher divestments
and productivity programs, partly offset by growth investments, legal provisions and higher impairments.
Net income was USD 7.1 billion (-44%, -41% cc) as prior year benefited from a USD 5.7 billion net gain
recognized from the sale of our stake in the GSK consumer healthcare joint venture. EPS was USD 3.12
(-43%, -40% cc) benefiting from lower weighted average number of shares outstanding.
Core operating income was USD 14.1 billion (+12%, +17% cc) mainly driven by higher sales and
productivity programs, partly offset by growth investments. Core operating income margin was 29.7% of
net sales, increasing by 1.6 percentage points (+1.9 percentage points cc).
Core net income was USD 12.1 billion (+11%, +15% cc) driven by growth in core operating income partly
offset by the discontinuation of core income from the GSK consumer healthcare joint venture. Core EPS
was USD 5.28 (+12%, +17% cc) growing faster than core net income driven by lower weighted average
number of shares outstanding.
Free cash flow from continuing operations amounted to USD 12.9 billion (+15%) compared to USD 11.3
billion in 2018. The increase was mainly driven by higher operating income adjusted for non-cash items.
Innovative Medicines net sales were USD 37.7 billion (+8%, +11% cc) in 2019. Pharmaceuticals BU
grew 12% (cc) driven by Cosentyx reaching USD 3.6 billion, Entresto USD 1.7 billion and Zolgensma
USD 361 million. Oncology BU grew 10% (cc) driven by Promacta/Revolade reaching USD 1.4 billion, Kisqali USD 0.5 billion and Lutathera USD 0.4 billion. Volume contributed 13 percentage points to sales growth. Generic competition had a negative impact of 1 percentage point. Net pricing had a negative impact of 1 percentage point.
Sandoz net sales were USD 9.7 billion (-1%, +2% cc) driven by strong volume growth of 8 percentage points partially offset by 6 percentage points (of price erosion, mainly in the US. Excluding the US, net sales grew strongly (+7% cc). Global sales of Biopharmaceuticals grew to USD 1.6 billion (+16% cc), driven by continued strong double-digit growth in Europe from Hyrimoz (adalimumab), Rixathon (rituximab) and Erelzi (etanercept).

Discontinued operations
Discontinued operations include the business of Alcon and certain Corporate costs directly attributable to Alcon up to the spin-off date. As the Alcon spin-off was completed on April 9, 2019, there were no operating results in the fourth quarter of 2019.
Discontinued operations net sales in 2019 were USD 1.8 billion compared to USD 7.1 billion in 2018 and operating income amounted to USD 71 million compared to an operating loss of USD 234 million in 2018.
Net income from discontinued operations in 2019 amounted to USD 4.6 billion compared to a net loss of USD 186 million in 2018 driven by the non-taxable non-cash net gain on distribution of Alcon Inc. to Novartis AG shareholders which amounted to USD 4.7 billion. For further details see Note 3 “Significant transactions – Completion of the spin-off of the Alcon business through a dividend in kind distribution to Novartis AG shareholders”.

Total Group fourth quarter
For the total Group, net income amounted to USD 1.1 billion compared to USD 1.2 billion in prior year, and basic earnings per share was USD 0.50 compared to USD 0.52 in prior year. Cash flow from operating activities for the total Group amounted to USD 3.5 billion and free cash flow to USD 3.5 billion.

Total Group full year
For the total Group, net income amounted to USD 11.7 billion compared to USD 12.6 billion in prior year, and basic earnings per share was USD 5.12 compared to USD 5.44 in prior year. Cash flow from operating activities for the total Group amounted to USD 13.6 billion and free cash flow to USD 12.9 billion.

Key growth drivers (Q4 performance):
Underpinning our financial results in the fourth quarter is a continued focus on key growth drivers including:
? Entresto (USD 518 million, +65% cc) continued to deliver strong double-digit performance,
benefiting from the PIONEER data on hospital initiation and higher demand in ambulatory settings.
? Zolgensma (USD 186 million) US launch continued to progress well. Policies are in place covering
~97% of commercial patients and >50% of Medicaid patients. Currently, 16 states representing
~32% of newborns are screening for SMA in the US.
? Cosentyx (USD 965 million, +21% cc) continued to grow strongly across indications and regions. In
the US sales grew 25% with broad first line access in all three indications.
? Kisqali (USD 155 million, +166% cc) accelerated in the US driven by use in metastatic breast cancer
patients, independent of menopausal status or combination partner, and benefiting from overall
survival data, as well as strong uptake and patient share gain in Europe and other regions.
? Kymriah (USD 96 million) grew driven by ongoing uptake in the US and Europe. There are over 200
qualified treatment centers and more than 20 countries worldwide have coverage for at least one
indication.
? Piqray (USD 67 million) US launch continued to progress well. Piqray is the first and only treatment
for the 40% of HR+/HER2- advanced breast cancer patients who harbor a PIK3CA mutation.
? Promacta/Revolade (USD 380 million, +16% cc) grew at a double-digit rate in most regions driven
by increased use in chronic immune thrombocytopenia (ITP) and further uptake as first-line
treatment for severe aplastic anemia (SAA) in the US.
? Tafinlar + Mekinist (USD 356 million, +15% cc) grew double-digit due to demand in metastatic and
adjuvant melanoma as well as NSCLC, with ongoing uptake of the adjuvant melanoma indication in
Europe.
? Jakavi (USD 293 million, +17% cc) grew double-digit across all regions driven by demand in the
myelofibrosis and polycythemia vera indications.
? Beovu (USD 35 million) was launched in the US following FDA approval in October. Initial launch
uptake has been strong and broad access has been established including a permanent J-code from
CMS effective January 1, 2020.
? Lutathera (USD 107 million, +31% cc) continued to grow led by the US, with over 170 centers
actively treating patients, and ongoing launches in Europe. Sales from all AAA brands (including
Lutathera and radiopharmaceutical diagnostic products) were USD 168 million.
? Mayzent (USD 17 million) launch is progressing and efforts are ongoing to accelerate patient onboarding and drive urgency to treat.
? Biopharmaceuticals (biosimilars, biopharmaceutical contract manufacturing and Glatopa) grew to
USD 425 million (+11% cc), driven by continued strong double-digit growth in Europe.
? Emerging Growth Markets, which comprise all markets except the US, Canada, Western Europe,
Japan, Australia and New Zealand, sales grew 12% (cc), driven by China (USD 544 million) growing
21% (cc) from strong volume growth, including the launches of Cosentyx and Entresto.
Net sales of the top 20 Innovative Medicines products in 2019
Q4 2019
USD m
% change FY 2019
USD m
% change
USD cc USD cc
Cosentyx 965 20 21 3 551 25 28
Gilenya 803 -4 -3 3 223 -4 -1
Lucentis 517 -1 1 2 086 2 7
Tasigna 491 3 4 1 880 0 3
Entresto 518 63 65 1 726 68 71
Sandostatin 402 1 2 1 585 0 2
Afinitor/Votubia 365 -9 -8 1 539 -1 1
Promacta/Revolade 380 15 16 1 416 21 23
Tafinlar + Mekinist 356 14 15 1 338 16 20
Galvus Group 342 5 5 1 297 1 5
Gleevec/Glivec 313 -16 -15 1 263 -19 -17
Xolair 303 13 16 1 173 13 19
Jakavi 293 14 17 1 114 14 20
Diovan Group 266 2 5 1 064 4 9
Exforge Group 245 -2 -1 1 025 2 7
Exjade/Jadenu 231 -19 -19 975 -11 -9
Votrient 177 -11 -10 755 -9 -6
Ilaris 178 15 16 671 21 25
Zortress/Certican 123 3 5 485 5 8
Kisqali 155 158 166 480 104 111
Top 20 products total 7 423 7 8 28 646 7 11
see for more o
https://www.novartis.com/sites/www.novartis.com/files/q4-2019-media-release-en.pdf