In order to comply with International Financial Reporting Standards 
(IFRS), Novartis has separated the Group's reported financial data into 
"continuing" and "discontinued" operations. The results of the Alcon 
business in 2019 are reported as discontinued operations. See page 43 
and Notes 2, 3 and 10 in the Condensed Financial Report for a full 
explanation. 
 
   The commentary below focuses on continuing operations including the 
businesses of Innovative Medicines and Sandoz, as well as the continuing 
Corporate functions. We also provide information on discontinued 
operations. 
 
   Continuing operations fourth quarter 
 
   Net sales were USD 12.8 billion (+3%, +1% cc) in the fourth quarter 
driven by volume growth of 6 percentage points, offset by price erosion 
of 2 percentage points and the negative impact from generic competition 
of 3 percentage points. 
 
   Operating income was USD 2.6 billion (+45%, +51% cc) mainly due to lower 
impairments, lower legal charges and income from contingent receivables. 
 
   Net income was USD 2.1 billion (+86%, +93% cc) driven by higher 
operating income and benefiting from lower taxes. EPS was USD 0.92 (+84%, 
+93% cc), growing in line with net income. 
 
   Core operating income was USD 3.5 billion (+1%, +2% cc) mainly driven by 
higher sales. Core operating income margin was 27.4% of net sales, 
decreasing by 0.5 percentage points (+0.4 percentage points cc). 
 
   Core net income was USD 3.0 billion (+2%, +3% cc) mainly driven by 
growth in core operating income. Core EPS was USD 1.34 (+2%, +3% cc), 
growing in line with core net income. 
 
   Free cash flow from continuing operations amounted to USD 3.3 billion 
(-4%) compared to USD 3.5 billion in the prior year quarter, as higher 
cash flows from operating activities were more than offset by increased 
net investment for intangible assets. 
 
   Innovative Medicines net sales were USD 10.2 billion (+3%, +1% cc) with 
volume contributing 6 percentage points to growth, pricing had a 
negative impact of 1 percentage point and generic competition had a 
negative impact of 4 percentage points mainly due to Afinitor and 
Exjade. Pharmaceuticals BU sales grew 2% (cc) driven by strong growth 
from Entresto, Cosentyx and Zolgensma. Growth was partly offset by 
declines in Established Medicines and mature Ophthalmology brands. 
Oncology BU sales were broadly in line with prior year (+1% cc). Strong 
performance of Promacta/Revolade, Jakavi, Tafinlar + Mekinist, Kymriah, 
Adakveo and Kisqali was offset by generic competition, mainly for Exjade 
and Afinitor. The COVID-19 pandemic continued to negatively impact 
dermatology and ophthalmology. 
 
   Sandoz net sales were USD 2.5 billion (+2%, 0% cc) with a volume 
increase of 3 percentage points. There was a negative price effect of 3 
percentage points, despite the benefit from off-contract sales in the 
US. Global sales of Biopharmaceuticals grew 16% (cc), driven by 
continued strong growth in Europe. 
 
   Continuing operations full year 
 
   Net sales were USD 48.7 billion (+3%, +3% cc) in the full year mainly 
driven by Entresto, Zolgensma and Cosentyx. Volume contributed 9 
percentage points to sales growth, partly offset by price erosion of 3 
percentage points and the negative impact from generic competition of 3 
percentage points. 
 
   Operating income was USD 10.2 billion (+12%, +19% cc) mainly driven by 
higher sales and productivity including lower spend. 
 
   Net income was USD 8.1 billion (+13%, +20% cc) mainly driven by higher 
operating income. EPS was USD 3.55 (+14%, +21% cc), growing faster than 
net income and benefiting from lower weighted average number of shares 
outstanding. 
 
   Core operating income was USD 15.4 billion (+9%, +13% cc) mainly driven 
by higher sales, improved gross margin and productivity including lower 
spend. Core operating income margin was 31.7% of net sales, increasing 
by 2.0 percentage points (+2.8 percentage points cc). 
 
   Core net income was USD 13.2 billion (+9%, +12% cc) mainly driven by 
growth in core operating income. Core EPS was USD 5.78 (+9%, +13% cc), 
growing faster than core net income and benefiting from lower weighted 
average number of shares outstanding. 
 
   Free cash flow from continuing operations amounted to USD 11.7 billion 
(-10%) compared to USD 12.9 billion in 2019, as higher operating income 
adjusted for non-cash items was more than offset by payments related to 
legal matters and lower divestment proceeds. 
 
   Innovative Medicines net sales were USD 39.0 billion (+3%, +4% cc) with 
volume contributing 10 percentage points to growth, pricing a negative 3 
percentage points and generic competition had a negative impact of 3 
percentage points. Pharmaceuticals BU grew 5% (cc) driven by Entresto 
(+44% cc), Zolgensma (reaching USD 0.9 billion), Cosentyx (+13% cc) and 
Ilaris (+31% cc). Growth was partly offset by declines in Gilenya, and 
lower demand for Lucentis due to COVID-19. Other Ophthalmology products 
were also impacted by both COVID-19 and generic competition. Oncology BU 
grew 3% (cc) driven by Promacta/Revolade (+23% cc), Jakavi (+20% cc), 
Kisqali (+45% cc), Tafinlar + Mekinist (+16% cc) and Piqray (reaching 
USD 0.3 billion), partly offset by generic competition mainly on 
Afinitor and Exjade. 
 
   Sandoz net sales were USD 9.6 billion (-1%, 0% cc) with volume growth of 
2 percentage points despite the negative impact of COVID-19 mainly on 
the retail business. There was a negative price effect of 2 percentage 
points, despite the benefit from off-contract sales and favorable 
revenue deduction adjustments. Sales in Europe grew 2% (cc), while sales 
in the US declined 14%, due to the continued volume decline in oral 
solids including partnership terminations. Global sales of 
Biopharmaceuticals grew 19% (cc) to USD 1.9 billion, driven by continued 
double-digit growth across all regions. 
 
   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, the prior year 
included three months of operating results of the divested business. 
 
   In 2020, there were no operational activities related to discontinued 
operations. In the full year of 2019, discontinued operations net sales 
were USD 1.8 billion, operating income amounted to USD 71 million and 
net income from discontinued operations was USD 4.6 billion, including 
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 2 "Distribution of Alcon Inc. to Novartis AG 
shareholders", Note 3 "Significant transactions -- Completion of the 
spin-off of the Alcon business through a dividend in kind distribution 
to Novartis AG shareholders" and Note 10 "Discontinued operations" in 
the Condensed Financial Report. 
 
   Total Group full year 
 
   For the total Group, net income amounted to USD 8.1 billion compared to 
USD 11.7 billion in the prior year, including the non-taxable non-cash 
net gain on distribution of Alcon Inc. which amounted to USD 4.7 
billion. Basic earnings per share was USD 3.55 compared to USD 5.12 in 
prior year. Cash flow from operating activities for the total Group 
amounted to USD 13.6 billion and free cash flow to USD 11.7 billion. 
 
   Q4 key growth drivers 
 
   Underpinning our financial results in the quarter is a continued focus 
on key growth drivers including: 
 
 
 
 
Entresto            (USD 716 million, +35% cc) sustained strong growth 
                     with increased patient share across markets, driven 
                     by demand as the essential first choice therapy for 
                     rEF heart failure. 
------------------  ----------------------------------------------------------- 
Cosentyx            (USD 1 109 million, +13% cc) saw continued growth 
                     despite lower new patient starts across the market 
                     in dermatology and rheumatology due to COVID-19. 
------------------  ----------------------------------------------------------- 
Promacta/Revolade   (USD 471 million, +23% cc) grew across all regions, 
                     driven by increased use in chronic immune thrombocytopenia 
                     and as first-line treatment for severe aplastic anemia 
                     in the US. 
------------------  ----------------------------------------------------------- 
Jakavi              (USD 376 million, +24% cc) growth was driven by strong 
                     demand in the myelofibrosis and polycythemia vera 
                     indications. 
------------------  ----------------------------------------------------------- 
Zolgensma           (USD 254 million, +33% cc) growth was driven by expansion 
                     outside the US, including reimbursement in the EU 
                     and Japan, despite COVID-19 impacts. 
------------------  ----------------------------------------------------------- 
Tafinlar +          (USD 408 million, +13% cc) continued to show solid 
Mekinist             growth driven by demand in adjuvant melanoma as well 
                     as NSCLC. 
------------------  ----------------------------------------------------------- 
Kymriah             (USD 141 million, +42% cc) grew strongly in Europe, 
                     US and Japan. Coverage continued to expand, with more 
                     than 290 qualified treatment centers and 27 countries 
                     having coverage for at least one indication. 
------------------  ----------------------------------------------------------- 
Mayzent             (USD 57 million) continued to grow steadily, fulfilling 
                     an important unmet medical need in patients showing 
                     signs of progression. 
------------------  ----------------------------------------------------------- 
Adakveo             (USD 34 million) US launch continued to progress well, 
                     with more than 600 accounts purchasing Adakveo to 

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