Press Release: Novartis continues strong momentum with double-digit sales growth, robust margin expansion and multiple approvals in Q1

Ad hoc announcement pursuant to Art. 53 LR

-- Net sales grew +15% (cc1, +12% USD) with core operating income1 up +27%

(cc, +23% USD)

-- Sales growth driven by continued strong performance from Entresto

(+22% cc), Kisqali (+56% cc), Kesimpta (+43% cc), Cosentyx (+18%

cc), Leqvio (+72% cc) and Scemblix (+76% cc)

-- Core operating income margin1 reached 42.1%, +400 basis points

(cc), mainly driven by higher net sales

-- Operating income grew +44% (cc, +38% USD); net income up +37% (cc, +34%

USD)

-- Core EPS1 grew +31% (cc, +27% USD) to USD 2.28

-- Free cash flow1 of USD 3.4 billion (+66% USD) driven by higher net cash

flows from operating activities

-- Selected innovation milestones:

-- Pluvicto FDA approval for pre-taxane mCRPC

-- Vanrafia (atrasentan) FDA accelerated approval for IgA

nephropathy

-- Fabhalta (iptacopan) FDA, EC and China NMPA approvals for C3G

-- Remibrutinib global submissions for CSU, with priority review

voucher in US

-- OAV101 IT Phase III STEER study positive readout in SMA

-- Full-year 2025 guidance2 raised: Sales expected to grow high single digit,

core operating income expected to grow low double-digit

Basel, April 29, 2025 -- Commenting on Q1 2025 results, Vas Narasimhan, CEO of Novartis, said:

"Novartis has had a strong start to the year, delivering a +15% cc increase in sales and a +27% cc rise in core operating income in Q1. Our priority brands, including Kisqali, Kesimpta and Leqvio, continue to show strong momentum, which we anticipate will drive our growth through 2030 and beyond. We also achieved significant innovation milestones in the quarter, with new approvals for Pluvicto in the pre-taxane setting, Vanrafia for IgA nephropathy, and Fabhalta for C3G. Additionally, we completed global submissions for remibrutinib in CSU, the first indication for this promising pipeline-in-a-pill. We remain focused on advancing our leading pipeline and confident in achieving our growth outlook."

Key figures

Q1 2025 Q1 2024 % change

USD m USD m USD cc

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Net sales to third parties 13 233 11 829 12 15

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Operating income 4 663 3 373 38 44

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Net income 3 609 2 688 34 37

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EPS (USD) 1.83 1.31 40 42

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Free cash flow 3 391 2 038 66

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Core operating income 5 575 4 537 23 27

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Core net income 4 482 3 681 22 26

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Core EPS (USD) 2.28 1.80 27 31

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1. Constant currencies (cc), core results and free cash flow are non-IFRS measures. An explanation of non-IFRS measures can be found on page 31 of the Condensed Interim Financial Report. Unless otherwise noted, all growth rates in this Release refer to same period in prior year. 2. Please see detailed guidance assumptions on page 5.

Strategy

Our focus

Novartis is a "pure-play" innovative medicines company. We have a clear focus on four core therapeutic areas (cardiovascular-renal-metabolic, immunology, neuroscience and oncology), with multiple significant in-market and pipeline assets in each of these areas, that address high disease burden and have substantial growth potential. In addition to two established technology platforms (chemistry and biotherapeutics), three emerging platforms (gene & cell therapy, radioligand therapy and xRNA) are being prioritized for continued investment into new R&D capabilities and manufacturing scale. Geographically, we are focused on growing in our priority geographies -- the US, China, Germany and Japan.

Our priorities

1. Accelerate growth: Renewed attention to deliver high-value medicines

(NMEs) and focus on launch excellence, with a rich pipeline across our

core therapeutic areas.

2. Deliver returns: Continuing to embed operational excellence and deliver

improved financials. Novartis remains disciplined and shareholder-focused

in our approach to capital allocation, with substantial cash generation

and a strong capital structure supporting continued flexibility.

3. Strengthen foundations: Unleashing the power of our people, scaling data

science and technology and continuing to build trust with society.

Financials

Net sales were USD 13.2 billion (+12%, +15% cc), with volume contributing 15 percentage points to growth. Generic competition had a negative impact of 2 percentage points and pricing had a positive impact of 2 percentage points, benefiting from revenue deduction adjustments mainly in the US.

Operating income was USD 4.7 billion (+38%, +44% cc), mainly driven by higher net sales, partly offset by higher investments behind priority brands and launches.

Net income was USD 3.6 billion (+34%, +37% cc), mainly driven by higher operating income, partly offset by higher income taxes. EPS was USD 1.83 (+40%, +42% cc), benefiting from the lower weighted average number of shares outstanding.

Core operating income was USD 5.6 billion (+23%, +27% cc), mainly driven by higher net sales, partly offset by higher investments behind priority brands and launches, and R&D investments. Core operating income margin was 42.1% of net sales, increasing 3.7 percentage points (4.0 percentage points cc).

Core net income was USD 4.5 billion (+22%, +26% cc), mainly due to higher core operating income. Core EPS was USD 2.28 (+27%, +31% cc), benefiting from the lower weighted average number of shares outstanding.

Free cash flow amounted to USD 3.4 billion (+66% USD), compared with USD 2.0 billion in the prior-year quarter, driven by higher net cash flows from operating activities.

Q1 priority brands

Underpinning our financial results in the quarter is a continued focus on key growth drivers (ranked in order of contribution to Q1 growth) including:

Entresto (USD 2 261 million, +22% cc) sustained robust, demand-led

growth globally, including in China and Japan with

increased penetration in hypertension

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Kisqali (USD 956 million, +56% cc) sales grew strongly across

all regions, including +87% growth in the US with

strong momentum from the recently launched early breast

cancer indication as well as continued share gains

in metastatic breast cancer

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Kesimpta (USD 899 million, +43% cc) sales grew across all regions

driven by increased demand and strong access

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Cosentyx (USD 1 534 million, +18% cc) sales grew mainly in

the US, emerging growth markets and Europe, driven

by recent launches as well as volume growth in core

indications

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Leqvio (USD 257 million, +72% cc) continued steady growth,

with a focus on increasing account and patient adoption,

and continuing medical education

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Scemblix (USD 238 million, +76% cc) sales grew across all regions,

demonstrating the continued high unmet need in CML

and strong momentum from the recently launched early-line

indication in the US

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Fabhalta (USD 81 million) sales grew driven by continued launch

execution across all markets in PNH as well as the

recent launch in IgAN in the US

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Pluvicto (USD 371 million, +21% cc) continued stable performance

in the US and grew in Europe in the mCRPC post-taxane

setting. With the FDA's approval for earlier use before

chemotherapy, which approximately triples the eligible

patient population, the focus is on driving demand

in established RLT sites while activating new sites

and supporting referring providers to enable patient

access

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Zolgensma (USD 327 million, +13% cc) sales grew as it continues

to demonstrate strong performance in the incident

population

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Lutathera (USD 193 million, +15% cc) sales grew mainly in the

US, Europe and Japan due to increased demand and earlier

line adoption particularly in the US and Japan

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