Novartis Pharmaceuticals Corporation to Appeal Judgment in Alabama Pricing Case

NovartisNovartis Pharmaceuticals Corporation (NPC) announced it will appeal a verdict in the Montgomery County Circuit Court. Novartis disputes the State of Alabama's claims that the prices provided by NPC to reporting services resulted in overpayment to pharmacists and doctors in the Alabama State Medicaid system.

NPC was among 73 pharmaceutical manufacturers named in a lawsuit filed in 2005 by the Alabama Attorney General, claiming that the average wholesale price (AWP) and wholesale acquisition cost (WAC) provided by pharmaceutical companies to price reporting services resulted in overpayment to pharmacists and doctors in the State Medicaid system. The jury rejected the State's claims for the punitive damages but decided against NPC on the State's claims for compensatory damages awarding $33 million.

NPC believes Alabama's claims were unfounded because it reported true and accurate prices, based on terms that have been known and used by all participants in pharmaceuticals markets, including Alabama Medicaid, for more than 30 years.

About Novartis
Novartis Pharmaceuticals Corporation researches, develops, manufactures and markets leading innovative prescription drugs used to treat a number of diseases and conditions, including those in the cardiovascular, metabolic, cancer, organ transplantation, central nervous system, dermatological, GI and respiratory areas. The company's mission is to improve people's lives by pioneering novel healthcare solutions.

Located in East Hanover, New Jersey, Novartis Pharmaceuticals Corporation is an affiliate of Novartis AG (NYSE: NVS), which provides healthcare solutions that address the evolving needs of patients and societies. Focused solely on growth areas in healthcare, Novartis offers a diversified portfolio to best meet these needs: innovative medicines, cost-saving generic pharmaceuticals, preventive vaccines and diagnostic tools, and consumer health products. Novartis is the only company with leading positions in these areas. In 2007, the Group's continuing operations (excluding divestments in 2007) achieved net sales of USD 38.1 billion and net income of USD 6.5 billion. Approximately USD 6.4 billion was invested in R&D activities throughout the Group. Headquartered in Basel, Switzerland, Novartis Group companies employ approximately 98,200 full-time associates and operate in over 140 countries around the world. For more information, please visit http://www.novartis.com.

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