The launch by Teva Pharmaceuticals, announced on September 7, is considered "at risk" since the two companies are involved in patent infringement litigation, which began in 2005. Teva risks potentially significant damages if Novartis prevails in litigation. A trial date has not been set. Teva launched this product after the US District Court in Newark, New Jersey, denied on September 5 a request for a preliminary injunction.

The worldwide rights to Famvir, which had 2006 net sales of USD 166 million in the US, was acquired in December 2001. As a result of Teva's actions, a one-time accounting charge will be taken in the 2007 third quarter for the impairment of intangible assets, and it is expected to be in range of USD 250 million to USD 300 million.

Novartis reaffirms its outlook for record operating and net income from continuing operations in 2007 as well as for mid-single-digit growth in net sales for Group continuing operations and for low-single-digit growth in the Pharmaceuticals Division, both in local currencies.

About Novartis
Novartis AG (NYSE: NVS) is a world leader in offering medicines to protect health, cure disease and improve well-being. Our goal is to discover, develop and successfully market innovative products to treat patients, ease suffering and enhance the quality of life. We are strengthening our medicine-based portfolio, which is focused on strategic growth platforms in innovation-driven pharmaceuticals, high-quality and low-cost generics, human vaccines and leading self-medication OTC brands. Novartis is the only company with leadership positions in these areas. In 2006, the Group's businesses achieved net sales of USD 37.0 billion and net income of USD 7.2 billion. Approximately USD 5.4 billion was invested in R&D. Headquartered in Basel, Switzerland, Novartis Group companies employ more than 100,000 associates and operate in over 140 countries around the world. For more information, please visit http://www.novartis.com.