Q1 2019 Results - Novartis Disclaimer. 2. Novartis Q1 2019 Results | April 24, 2019 | Novartis...

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Transcript of Q1 2019 Results - Novartis Disclaimer. 2. Novartis Q1 2019 Results | April 24, 2019 | Novartis...

  • Q1 2019 Results Investor Presentation April 24, 2019

    Novartis AG Investor Relations

  • Disclaimer

    Novartis Q1 2019 Results | April 24, 2019 | Novartis Investor Presentation 2

    This presentation contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995, that can generally be identified by words such as “potential,” “expected,” “will,” “planned,” “pipeline,” “outlook,” or similar expressions, or by express or implied discussions regarding potential new products, potential new indications for existing products, or regarding potential future revenues from any such products; or regarding the potential outcome, or financial or other impact on Novartis, of the spinoff of our Alcon Division, or of the proposed divestiture of certain portions of our Sandoz Division business in the US; or regarding the potential impact of the share buyback plan; or regarding potential future sales or earnings of the Group or any of its divisions or potential shareholder returns; or by discussions of strategy, plans, expectations or intentions. Such forward-looking statements are based on the current beliefs and expectations of management regarding future events, and are subject to significant known and unknown risks and uncertainties. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those set forth in the forward-looking statements. You should not place undue reliance on these statements. In particular, our expectations could be affected by, among other things: global trends toward healthcare cost containment, including ongoing government, payer and general public pricing and reimbursement pressures and requirements for increased pricing transparency; regulatory actions or delays or government regulation generally, including potential regulatory actions or delays with respect to the proposed transactions or the development of the products described in this presentation; the potential that the strategic benefits, synergies or opportunities expected from the Alcon and Sandoz transactions may not be realized or may be more difficult or take longer to realize than expected; the inherent uncertainties involved in predicting shareholder returns; the uncertainties inherent in the research and development of new healthcare products, including clinical trial results and additional analysis of existing clinical data; our ability to obtain or maintain proprietary intellectual property protection, including the ultimate extent of the impact on Novartis of the loss of patent protection and exclusivity on key products that commenced in prior years and will continue this year; safety, quality or manufacturing issues; uncertainties regarding actual or potential legal proceedings, including, among others, actual or potential litigation with respect to the proposed transactions, product liability litigation, litigation and investigations regarding sales and marketing practices, intellectual property disputes and government investigations generally; uncertainties involved in the development or adoption of potentially transformational technologies and business models; our performance on environmental, social and governance measures; general political, economic and trade conditions, including uncertainties regarding the effects of ongoing instability in various parts of the world; uncertainties regarding future global exchange rates; uncertainties regarding future demand for our products; uncertainties regarding potential significant breaches of data security or data privacy, or disruptions of our information technology systems; and other risks and factors referred to in Novartis AG’s current Form 20-F on file with the US Securities and Exchange Commission. Novartis is providing the information in this presentation as of this date and does not undertake any obligation to update any forward-looking statements as a result of new information, future events or otherwise.

  • Vas Narasimhan Chief Executive Officer

    Company overview

  • Novartis off to a strong start in 2019

    Novartis Q1 2019 Results | April 24, 2019 | Novartis Investor Presentation

    Sales

    +7%

    Raised core OpInc guidance

     Completed Alcon spin-off

     Up to USD 5bn share buyback to be completed end 20193

     Plan strong & growing dividend up from CHF 2.85 paid in 2019

    4

    1. Refers to continuing operations as defined on page 32 of the Condensed Interim 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. Core results are non-IFRS measures. Further details regarding non-IFRS measures can be found starting on page 41 of the Condensed Interim Financial Report 2. Presented to MDA in April 2019; The brand name Zolgensma® has been provisionally approved by the FDA for the investigational product AVXS-101 (onasemnogene abeparvovec-xioi), but the product itself has not received marketing authorization or BLA approval from any regulatory authorities 3. USD 0.8b of an up to USD 5b commitment completed in 2018, and the remainder expected to be completed by end 2019

    Strong operational performance1 Continuing operations % cc

    Major innovation milestones

    Continued transformation to focused medicines company

    Core margin

    +2.6% pts

    Core OpInc

    +18%

    4

    Zolgensma® STR1VE interim analysis2

  • Starting to deliver operating leverage with Q1 Innovative Medicines core1 margin of 33.3%

     Sales momentum on key growth drivers

     Launch investments largely within existing infrastructure

     NTO and NBS productivity

     Core1 R&D cost at 20.2% of IM division sales in Q1

    Novartis Q1 2019 Results | April 24, 2019 | Novartis Investor Presentation 5

    IM Division 2017

    IM Division 2018

    31 32 Mid 30s

    Innovative Medicines Core margin (%)

    IM Division 2022

    Key drivers:

    1. Core results are non-IFRS measures. Further details regarding non-IFRS measures can be found starting on page 41 of the Condensed Interim Financial Report

  • 6

    Q1 Sales USD m

    vs. PY cc

    Growth vs. PY USD m

    24

    33

    50

    157

    30

    100

    211

    47

    26

    791

    357

    106

    307

    91

    45

    297

    281

    258

    41%

    85%

    nm1

    24%

    115%

    nm1

    18%

    20%

    20% 1. Not meaningful

    Novartis Q1 2019 Results | April 24, 2019 | Novartis Investor Presentation

    Lutathera®

    Continued sales momentum of Innovative Medicines

    http://www.novartisoncology.com/products/jakavi.jsp

  • Cosentyx®: Strong growth in Q1 driven by underlying demand

    Novartis Q1 2019 Results | April 24, 2019 | Novartis Investor Presentation 7

     US Q1 TRx growth +37%1 vs. PY

     US Q1 sales increased +49% vs. PY

     Continued strong growth across all indications, US and ex-US

     Received China approval for PsO in March; expected launch H2 2019

    1. IQVIA National Prescription Audit for rheumatologists and dermatologists, WE 03/29/2019.

    Sales evolution USD m, % cc

    Q1 2018 Q1 2019

    580 791

    Ex-US US

    +41%

  • Cosentyx®: Gaining share in a growing competitive psoriasis market, on course for leadership in spondyloarthritis

    Novartis Q1 2019 Results | April 24, 2019 | Novartis Investor Presentation 8

     NBRx growth +23% QoQ, outperforming US market +14%1

     Continues to lead in TRx among new entrants in US1

     IL-17 vs. IL-23 ARROW readout on track end 2019

    QoQ – Q1 2019 vs. Q4 2018 New entrants – Siliq, Tremfya, Taltz 1. IQVIA National Prescription Audit for dermatologists, WE 04/05/2019 2. NBRx share 3. TRx share All trademarks are the property of their respective owners

    US NBRx1 Dermatology

    150

    Jul/18Jan/18 Oct/18Apr/18 Jan/19 Apr/19

    300

    450

    19%2

     Surpassed Humira® in TRx in rheumatology in US1

     Cosentyx® US NBRx share 43% vs. Humira® 20%2

     PREVENT (nr-axSpA) readout on track end 2019

    Dec/18Jun/18

    4,000

    Feb/18 Sep/18 Mar/19

    0 2,000

    28%3

    US TRx1 Rheumatology3 Taltz®Stelara® Tremfya®Cosentyx® Taltz®Enbrel®Cosentyx® Stelara®Humira®

  • Entresto®: Strong Q1 sales growth fueled by PIONEER-HF and operational execution

    Novartis Q1 2019 Results | April 24, 2019 | Novartis Investor Presentation 9

    Sales evolution USD m, % cc

    Q1 2018 Q1 2019

    200

    357Ex-US US

    +85%  Underlying demand continuing to build, supported by

    PIONEER-HF data across all geographies

     US weekly NBRx all-time high of 3.9k in Q11

     PARAGON-HF on track for H2 readout, Entresto® potentially to be first and only drug approved in HFpEF

    1. NBRx IMS New to Brand, WE 04/05/19

  • Oncology grew +9% (cc) in Q1, continued strong performance of key growth drivers

    Novartis Q1 2019 Results | April 24, 2019 | Novartis Investor Presentation 10

    Promacta®/Revolade® USD m, % cc

    257 307

    Q1 2019Q1 2018

    +24%

    Tafinlar® + Mekinist®

    267 297

    Q1 2019Q1 2018