Table of contents
Introduction and use of certain terms
Forward-looking statements
Part I
Item 1. Identity of Directors, Senior Management and Advisers
Item 2. Offer Statistics and Expected Timetable
Item 3. Key Information
3.A Selected financial data
3.B Capitalization and indebtedness
3.C Reasons for the offer and use of proceeds
3.D Risk factors
Item 4. Information on the Company
4.A History and development of Novartis
4.B Business overview
Innovative Medicines
Compound/ product | Common name | Mechanism of action | Potential indication | Business franchise | Formulation/ route of administration | Year project entered current development phase | Planned filing dates/current phase | ||||||||
ABL0011 | asciminib | BCR‑ABL inhibitor | Chronic myeloid leukemia, 3rd line | Hematology | Oral | 2021 | US approved EU registration | ||||||||
Chronic myeloid leukemia, 1st line2 | Hematology | Oral | 2021 | 2025/III | |||||||||||
ACZ885 | canakinumab | IL‑1 beta inhibitor | Non‑small cell lung cancer, adjuvant | Solid Tumor | Subcutaneous injection | 2018 | 2023/III | ||||||||
AVXS-101 (OAV101) | onasemno- gene abepar- vovec | Survival motor neuron (SMN) gene therapy | Spinal muscular atrophy (IT formulation)3 | Neuroscience | Intrathecal injection | 2021 | 2025/III | ||||||||
Beovu | brolucizumab | VEGF inhibitor | Diabetic macular edema | Ophthalmology | Intravitreal injection | 2021 | US/EU registration | ||||||||
Diabetic retinopathy | Ophthalmology | Intravitreal injection | 2020 | 2025/III | |||||||||||
BYL719 | alpelisib | PI3K‑alpha inhibitor | PIK3CA-related overgrowth spectrum | Solid Tumor | Oral | 2021 | US registration | ||||||||
Triple negative breast cancer | Solid Tumor | Oral | 2020 | 2023/III | |||||||||||
Human epidermal growth factor receptor 2-positive (HER2+) advanced breast cancer | Solid Tumor | Oral | 2020 | 2025/III | |||||||||||
Ovarian cancer | Solid Tumor | Oral | 2021 | 2023/III | |||||||||||
CFZ533 | iscalimab | CD40 inhibitor | Liver transplantation | Immunology, Hepatology and Dermatology | Intravenous infusion | 2019 | ≥2026/II | ||||||||
Sjögren's syndrome | Immunology, Hepatology and Dermatology | Subcutaneous injection | 2019 | ≥2026/II | |||||||||||
Coartem | artemether + lumefantrine | PGH-1 | Malaria, uncomplicated (<5 kg patients) | Established Medicines | Oral | 2020 | 2024/III | ||||||||
Cosentyx | secukinumab | IL‑17A inhibitor | Ankylosing spondylitis head‑to‑head study versus Sandoz biosimilar Hyrimoz (adalimumab) | Immunology, Hepatology and Dermatology | Subcutaneous injection | 2017 | 2022/III | ||||||||
Hidradenitis suppurativa | Immunology, Hepatology and Dermatology | Subcutaneous injection | 2019 | 2022/III | |||||||||||
Giant cell arteritis | Immunology, Hepatology and Dermatology | Subcutaneous injection | 2021 | 2024/III | |||||||||||
Lichen planus | Immunology, Hepatology and Dermatology | Subcutaneous injection | 2020 | 2025/II | |||||||||||
Lupus nephritis | Immunology, Hepatology and Dermatology | Subcutaneous injection | 2020 | ≥2026/III | |||||||||||
Psoriatic arthritis (IV formulation) | Immunology, Hepatology and Dermatology | Intravenous infusion | 2019 | 2022/III | |||||||||||
Ankylosing spondylitis (IV formulation) | Immunology, Hepatology and Dermatology | Intravenous infusion | 2019 | 2023/III | |||||||||||
CSJ117 | TBD | TSLP inhibitor | Asthma | Respiratory and Allergy | Inhalation | 2020 | ≥2026/II | ||||||||
1 Approved in the US as Scemblix for chronic myeloid leukemia | |||||||||||||||
2 Project added to selected development projects table in 2021 – entered Confirmatory Development | |||||||||||||||
3 Clinical hold lifted; pivotal confirmatory study initiating |
Compound/ product | Common name | Mechanism of action | Potential indication | Business franchise | Formulation/ route of administration | Year project entered current development phase | Planned filing dates/current phase | ||||||||
Jakavi | ruxolitinib | JAK1/2 inhibitor | Acute graft‑versus‑host disease | Hematology | Oral | 2021 | EU registration4 | ||||||||
Chronic graft‑versus‑host disease | Hematology | Oral | 2021 | EU registration5 | |||||||||||
KAE609 | cipargamin | PfATP4 inhibitor | Malaria, uncomplicated | Established Medicines | Oral | 2017 | ≥2026/II | ||||||||
Malaria, severe | Established Medicines | Oral | 20196 | ≥2026/II | |||||||||||
KAF156 | ganaplacide | Imidazolopiperazines derivative | Malaria, uncomplicated | Established Medicines | Oral | 2017 | ≥2026/II | ||||||||
Kisqali | ribociclib | CDK4 inhibitor | Hormone receptor-positive (HR+)/human epidermal growth factor receptor 2-negative (HER2-) early breast cancer (adjuvant) | Solid Tumor | Oral | 2018 | 2023/III | ||||||||
Kymriah | tisagen- lecleucel | CD19 CAR-T | Relapsed/refractory follicular lymphoma | Hematology | Intravenous infusion | 2021 | US/EU registration | ||||||||
Leqvio | inclisiran | siRNA (regulation of LDL-C) | Secondary prevention of cardiovascular events in patients with elevated levels of LDL-C | Cardiovascular, Renal and Metabolism | Subcutaneous injection | 2018 | ≥2026/III | ||||||||
LJN452 | tropifexor, licogliflozin (in fixed-dose combination) | FXR agonist and SGLT1/2 inhibitor | Nonalcoholic steatohepatitis | Immunology, Hepatology and Dermatology | Oral | 2019 | ≥2026/II | ||||||||
LMI070 | branaplam | mRNA splicing modulator | Huntington's disease7 | Neuroscience | Oral | 2021 | ≥2026/II | ||||||||
LNA043 | TBD | ANGPTL3 agonist | Knee osteoarthritis8 | Immunology, Hepatology and Dermatology | Intra-articular | 2021 | ≥2026/II | ||||||||
LNP023 | iptacopan | CFB inhibitor | IgA nephropathy | Cardiovascular, Renal and Metabolism | Oral | 2021 | 2023/III | ||||||||
C3 glomerulopathy | Cardiovascular, Renal and Metabolism | Oral | 2021 | 2023/III | |||||||||||
Paroxysmal nocturnal hemoglobinuria | Hematology | Oral | 2021 | 2023/III | |||||||||||
Membranous nephropathy | Cardiovascular, Renal and Metabolism | Oral | 2019 | ≥2026/II | |||||||||||
Atypical hemolytic uremic syndrome9 | Hematology | Oral | 2021 | 2025/III | |||||||||||
LOU064 | remibrutinib | BTK inhibitor | Chronic spontaneous urticaria | Immunology, Hepatology and Dermatology | Oral | 2021 | 2024/III | ||||||||
Sjögren's syndrome | Immunology, Hepatology and Dermatology | Oral | 2019 | ≥2026/II | |||||||||||
Multiple sclerosis10 | Neuroscience | Oral | 2021 | 2025/III | |||||||||||
Lutathera | lutetium Lu 177 dotatate/ lutetium (177Lu) oxodotreotide | Radioligand therapy targeting SSTR | Gastroenteropancreatic neuroendocrine tumors, 1st line in G2/3 tumors | Solid Tumor | Intravenous infusion | 2020 | 2023/III | ||||||||
4 US filing by Incyte Corporation | |||||||||||||||
5 US filing by Incyte Corporation | |||||||||||||||
6 Reflects the year in which the decision to enter the disclosed phase was made; “first patient, first visit” has not yet occurred | |||||||||||||||
7 Project added to selected development projects table in 2021 – entered Confirmatory Development | |||||||||||||||
8 Project added to selected development projects table in 2021 – entered Confirmatory Development | |||||||||||||||
9 Project added to selected development projects table in 2021 – entered Confirmatory Development | |||||||||||||||
10 Project added to selected development projects table in 2021 – entered Confirmatory Development |
Compound/ product | Common name | Mechanism of action | Potential indication | Business franchise | Formulation/ route of administration | Year project entered current development phase | Planned filing dates/current phase | ||||||||
177Lu- PSMA-617 | lutetium Lu 177 vipivotide tetraxetan/ lutetium (177Lu) vipivotide tetraxetan | Radioligand therapy targeting PSMA | Metastatic castration-resistant prostate cancer, post-taxane11 | Solid Tumor | Intravenous infusion | 2021 | US/EU registration | ||||||||
Metastatic castration-resistant prostate cancer, pre-taxane12 | Solid Tumor | Intravenous infusion | 2021 | 2023/III | |||||||||||
Metastatic hormone-sensitive prostate cancer13 | Solid Tumor | Intravenous infusion | 2021 | 2024/III | |||||||||||
LXE408 | TBD | Proteasome inhibitor | Visceral leishmaniasis | Established Medicines | Oral | 201914 | ≥2026/II | ||||||||
MBG453 | sabatolimab | TIM-3 antagonist | Myelodysplastic syndrome | Hematology | Intravenous infusion | 2020 | 2022/2023/III | ||||||||
Unfit acute myeloid leukemia | Hematology | Intravenous infusion | 2020 | 2024/II | |||||||||||
MIJ821 | TBD | NR2B negative allosteric modulator | Major depressive disorder15 | Neuroscience | Intravenous infusion | 2021 | ≥2026/II | ||||||||
NIS793 | TBD | TGF-beta 1 inhibitor | Pancreatic cancer, 1st line16 | Solid Tumor | Intravenous infusion | 2021 | 2025/III | ||||||||
QBW251 | icenticaftor | CFTR potentiator | Chronic obstructive pulmonary disease | Respiratory and Allergy | Oral | 2019 | 2025/II | ||||||||
QGE031 | ligelizumab | IgE inhibitor | Chronic spontaneous urticaria | Immunology, Hepatology and Dermatology | Subcutaneous injection | 2018 | TBD17/III | ||||||||
Chronic inducible urticaria18 | Immunology, Hepatology and Dermatology | Subcutaneous injection | 2021 | 2025/III | |||||||||||
Food allergy19 | Respiratory and Allergy | Subcutaneous injection | 2021 | 2025/III | |||||||||||
SAF312 | libvatrep | TRPV1 antagonist | Chronic ocular surface pain | Ophthalmology | Topical | 2016 | ≥2026/II | ||||||||
SKO13620 | ensovibep | Multispecific DARPin | Coronavirus infection | Established Medicines | Intravenous infusion | Not applicable (N/A) | 2022/II | ||||||||
TQJ230 | pelacarsen | ASO targeting lipoprotein(a) | Secondary prevention of cardiovascular events in patients with elevated levels of lipoprotein(a) | Cardiovascular, Renal and Metabolism | Subcutaneous injection | 2019 | 2025/III | ||||||||
UNR844 | TBD | Reduction of disulfide bonds | Presbyopia | Ophthalmology | Topical | 2019 | 2024/II | ||||||||
VAY736 | ianalumab | BAFF-R inhibitor | Autoimmune hepatitis | Immunology, Hepatology and Dermatology | Subcutaneous injection | 2018 | ≥2026/II | ||||||||
Sjögren’s syndrome | Immunology, Hepatology and Dermatology | Subcutaneous injection | 2017 | ≥2026/II | |||||||||||
VDT48221 | tislelizumab | Anti-PD-1 monoclonal antibody | Esophageal cancer, 2nd line | Solid Tumor | Intravenous infusion | N/A | US registration22 | ||||||||
Non‑small cell lung cancer | Solid Tumor | Intravenous infusion | N/A | 2022/III | |||||||||||
Nasopharyngeal carcinoma, 1st line | Solid Tumor | Intravenous infusion | N/A | 2022/III | |||||||||||
Gastric cancer, 1st line | Solid Tumor | Intravenous infusion | N/A | 2023/III | |||||||||||
Esophageal cancer, 1st line | Solid Tumor | Intravenous infusion | N/A | 2023/III | |||||||||||
Localized esophageal cancer | Solid Tumor | Intravenous infusion | N/A | 2023/III | |||||||||||
Hepatocellular carcinoma, 1st line | Solid Tumor | Intravenous infusion | N/A | 2023/III | |||||||||||
Small cell lung cancer, 1st line | Solid Tumor | Intravenous infusion | N/A | 2024/III | |||||||||||
Bladder urothelial cell carcinoma, 1st line | Solid Tumor | Intravenous infusion | N/A | 2024/III | |||||||||||
VPM087 | gevokizumab | IL-1 beta antagonist | Colorectal cancer, 1st line | Solid Tumor | Intravenous infusion | 2019 | ≥2026/I | ||||||||
Xolair | omalizumab | IgE inhibitor | Food allergy | Respiratory and Allergy | Subcutaneous injection | 2019 | 2023/III | ||||||||
11 Previously disclosed as metastatic castration-resistant prostate cancer | |||||||||||||||
12 Project added to selected development projects table in 2021 – entered Confirmatory Development | |||||||||||||||
13 Project added to selected development projects table in 2021 – entered Confirmatory Development | |||||||||||||||
14 Reflects the year in which the decision to enter the disclosed phase was made; “first patient, first visit” has not yet occurred | |||||||||||||||
15 Project added to selected development projects table in 2021 – entered Confirmatory Development | |||||||||||||||
16 Project added to selected development projects table in 2021 – entered Confirmatory Development | |||||||||||||||
17 Phase III PEARL data in evaluation | |||||||||||||||
18 Project added to selected development projects table in 2021 – entered Confirmatory Development | |||||||||||||||
19 Project added to selected development projects table in 2021 – entered Confirmatory Development | |||||||||||||||
20 In-licensed from Molecular Partners in 2021 (option deal) | |||||||||||||||
21 In-licensed from an affiliate of BeiGene, Ltd. in 2021 | |||||||||||||||
22 Biologics License Application (BLA) submitted by BeiGene, Ltd. to the FDA |
Compound/ product | Potential indication | Change | Reason | ||||
ACZ885 | Non‑small cell lung cancer, 2nd line | Removed | Development discontinued | ||||
Non‑small cell lung cancer, 1st line | Removed | Development discontinued | |||||
AVXS‑201 (OAV201) | Rett syndrome | Removed | Development discontinued | ||||
Beovu | Retinal vein occlusion | Removed | Development discontinued | ||||
BYL719 | Head and neck squamous cell carcinoma, 2nd and 3rd line | Removed | Development discontinued | ||||
CEE321 | Atopic dermatitis | Removed | Development discontinued | ||||
CFZ533 | Renal transplantation | Removed | Development discontinued | ||||
ECF843 | Dry eye | Removed | Development discontinued | ||||
Entresto | Chronic heart failure with preserved ejection fraction | Commercialized | |||||
Post‑acute myocardial infarction | Removed | Development discontinued | |||||
KJX839 | Hyperlipidemia | Commercialized as Leqvio | |||||
Kymriah | Relapsed/refractory diffuse large B‑cell lymphoma in 1st relapse | Removed | Development discontinued | ||||
LJC242 | Nonalcoholic steatohepatitis | Removed | Development discontinued | ||||
LMI070 | Spinal muscular atrophy | Removed | Development discontinued | ||||
OMB157 | Relapsing multiple sclerosis | Commercialized as Kesimpta | |||||
PDR001 | Malignant melanoma (combo) | Removed | Development discontinued | ||||
Tabrecta | Solid tumors | Removed | Development discontinued | ||||
2021 net sales to third parties | |||||
USD millions | % | ||||
United States | 14 999 | 36 | |||
Europe | 14 919 | 36 | |||
Asia, Africa, Australasia | 9 304 | 22 | |||
Canada and Latin America | 2 773 | 6 | |||
Total | 41 995 | 100 | |||
Of which in Established Markets 1 | 31 459 | 75 | |||
Of which in Emerging Growth Markets 1 | 10 536 | 25 | |||
1 Emerging Growth Markets comprise all markets other than the Established Markets of the US, Canada, Western Europe, Japan, Australia and New Zealand. |
Sandoz
Product | Originator drug | Description | |||
Amoxicillin/clavulanic acid | Augmentin ® | Antibiotic | |||
Zoledronic acid | Aclasta | Osteoporosis treatment | |||
Acetylcysteine | Various | Mucolytic agent | |||
Tacrolimus | Various | Immunosuppressive agent | |||
Active ingredients | Description | ||
Oral and sterile penicillins | Anti‑infectives | ||
Oral and sterile cephalosporins | Anti‑infectives | ||
Clavulanic acid and mixtures with clavulanic acid | Beta‑lactam inhibitors | ||
Classical and semisynthetic macrolides | Anti‑infectives | ||
Intermediates | Description | ||
Various cephalosporin intermediates | Anti‑infectives | ||
Macrolide base intermediates | Anti‑infectives | ||
Various crude compounds produced by fermentation | Cyclosporine, ascomycin, rapamycin, mycophenolic acid, etc. | ||
Product | Originator drug | Description | |||
Omnitrope | Genotropin ® | Recombinant human growth hormone to treat growth disorders and growth hormone deficiency | |||
Binocrit and Epoetin alfa Hexal | Eprex®/Erypo ® | Recombinant protein (erythropoiesis-stimulating) agent to treat anemia | |||
Zarzio, Zarxio and Filgrastim Hexal | Neupogen ® | Recombinant protein (granulocyte colony-stimulating factor, short-acting) used in oncology | |||
Glatopa | Copaxone ® | Treatment for relapsing forms of multiple sclerosis | |||
Erelzi 1 | Enbrel ® | Fusion protein (TNF-alpha receptor) to treat multiple immune-mediated inflammatory diseases | |||
Rixathon | MabThera ® | Chimeric monoclonal antibody (directed against CD20 protein on B-cells) to treat blood cancers and immunological diseases | |||
Hyrimoz | Humira ® | Monoclonal antibody (TNF-alpha antibody) to treat multiple immune-mediated inflammatory diseases | |||
Zessly | Remicade ® | Monoclonal antibody (TNF-alpha antibody) to treat multiple immune-mediated inflammatory diseases | |||
Ziextenzo | Neulasta ® | PEGylated form of a recombinant human granulocyte colony-stimulating factor (long-acting) to reduce duration of chemotherapy-induced neutropenia and incidence of chemotherapy-induced febrile neutropenia | |||
1 Approved in the US in 2016. In patent litigation with Amgen, which markets Enbrel®, the US District Court of New Jersey ruled against Sandoz in August 2019, which was upheld on appeal. The decision is now final and Sandoz cannot launch its Erelzi product in the US until 2029. |
Project/ product | Common name (INN) | Mechanism of action | Potential indication/indications | Therapeutic areas | Route of administration | Current phase | |||||||
GP2411 | denosumab | Anti-RANKL monoclonal antibody | Osteoporosis (same as originator) | Endocrinology, Neurology | Subcutaneous | Phase III | |||||||
SOK583 | aflibercept | Recombinant fusion protein that blocks VEGF-A | Ophthalmology indication (same as originator) | Ophthalmology | Intravitreal | Phase III | |||||||
EGI014A11 | trastuzumab | Anti-HER2 recombinat IgG1, humanized monoclonal antibody | HER2+ cancer tumors | Oncology | Intravenous | Registration | |||||||
DST356A12 | natalizumab | Anti-alpha4 integrin monoclonal antibody | Multiple sclerosis and Crohn’s disease | Neurology, Immunology (US only) | Intravenous | Phase III | |||||||
HFT896, SMQ969, PYB1063 | insulin glargine, lispro, aspart | Long-acting (HFT896)/ rapid-acting insulin | Diabetes | Endocrinology, Diabetology | Subcutaneous | Phase III/ Phase I | |||||||
VVF3794 | bevacizumab | Recombinant humanized monoclonal antibody that blocks VEGF | Solid tumors | Oncology | Intravenous | Phase III | |||||||
1 Development in collaboration with EirGenix, Inc. | |||||||||||||
2 Development in collaboration with Polpharma Biologics | |||||||||||||
3 Development in collaboration with Gan & Lee | |||||||||||||
4 Development in collaboration with Bio-Thera Solutions |
2021 net sales to third parties | |||||
USD millions | % | ||||
Europe | 5 278 | 55 | |||
United States | 1 819 | 19 | |||
Asia, Africa, Australasia | 1 662 | 17 | |||
Canada and Latin America | 872 | 9 | |||
Total | 9 631 | 100 | |||
Of which in Established Markets 1 | 6 855 | 71 | |||
Of which in Emerging Growth Markets 1 | 2 776 | 29 | |||
1 Emerging Growth Markets comprise all markets other than the Established Markets of the US, Canada, Western Europe, Japan, Australia and New Zealand. |
4.C Organizational structure
4.D Property, plants and equipment
Location | Size of site (in square meters) | Major activity | |||
Basel, Switzerland – St. Johann | 589 000 | Global Group headquarters; global Innovative Medicines Division headquarters; global Sandoz Division headquarters; research and development; production of drug substances and drug intermediates | |||
Kundl and Schaftenau, Austria | 480 000 | Production of biotechnological products, drug products and finished products, anti‑infectives, active drug substances and nucleic acids; product development | |||
East Hanover, New Jersey | 391 000 | Innovative Medicines Division US headquarters; research and development | |||
Barleben, Germany | 340 000 | Production of broad range of generics finished dosage forms | |||
Cambridge, Massachusetts | 201 800 | Research and development | |||
Menges, Slovenia | 133 763 | Production of drug substances and drug intermediates | |||
Shanghai, China | 106 500 | Research and development | |||
Stein, Switzerland | 64 700 | Production of sterile vials, pre‑filled syringes and ampoules; inhalation capsules, tablets and transdermals; active pharmaceutical ingredients; and cell and gene therapies | |||
Holzkirchen, Germany | 64 200 | Sandoz Division production of transdermal delivery systems and certain international and global service functions. | |||
Huningue, France | 35 000 | Production of drug substances for clinical and commercial supply | |||
Princeton, New Jersey | 14 300 | Sandoz Division US headquarters | |||
Libertyville, Illinois | 9 800 | Production, warehouse and administrative offices for the Novartis Gene Therapies unit within the Innovative Medicines Division | |||
Item 4A. Unresolved Staff Comments
Item 5. Operating and Financial Review and Prospects
5.A Operating results
(USD millions unless indicated otherwise) | Year ended Dec 31, 2021 | Year ended Dec 31, 2020 | Change in USD % | Change in constant currencies %1 | |||||
Net sales from continuing operations | 51 626 | 48 659 | 6 | 4 | |||||
Other revenues | 1 251 | 1 239 | 1 | 1 | |||||
Cost of goods sold | -15 867 | -15 121 | -5 | -3 | |||||
Gross profit from continuing operations | 37 010 | 34 777 | 6 | 5 | |||||
Selling, general and administration | -14 886 | -14 197 | -5 | -3 | |||||
Research and development | -9 540 | -8 980 | -6 | -5 | |||||
Other income | 1 852 | 1 742 | 6 | 6 | |||||
Other expense | -2 747 | -3 190 | 14 | 14 | |||||
Operating income from continuing operations | 11 689 | 10 152 | 15 | 13 | |||||
% of net sales to third parties | 22.6 | 20.9 | |||||||
Income from associated companies | 15 339 | 673 | nm | nm | |||||
Interest expense | -811 | -869 | 7 | 6 | |||||
Other financial income and expense | -80 | -78 | -3 | 44 | |||||
Income before taxes from continuing operations | 26 137 | 9 878 | 165 | 163 | |||||
Income taxes | -2 119 | -1 807 | -17 | -17 | |||||
Net income | 24 018 | 8 071 | 198 | 195 | |||||
Attributable to: | |||||||||
Shareholders of Novartis AG | 24 021 | 8 072 | 198 | 195 | |||||
Non-controlling interests | -3 | -1 | -200 | -200 | |||||
Total basic earnings per share (USD) | 10.71 | 3.55 | 202 | 200 | |||||
Net cash flows from operating activities from continuing operations | 15 071 | 13 650 | 10 | ||||||
Free cash flow 1 | 13 282 | 11 691 | 14 | ||||||
1 For an explanation of non-IFRS measures and reconciliation tables, see "—Non-IFRS measures as defined by Novartis." | |||||||||
nm = not meaningful |
(USD millions) | Year ended Dec 31, 2021 | Year ended Dec 31, 2020 | Change in USD % | Change in constant currencies % | |||||
Innovative Medicines | 41 995 | 39 013 | 8 | 6 | |||||
Sandoz | 9 631 | 9 646 | 0 | -2 | |||||
Net sales to third parties from continuing operations | 51 626 | 48 659 | 6 | 4 | |||||
(USD millions) | Year ended Dec 31, 2021 | Year ended Dec 31, 2020 | Change in USD % | Change in constant currencies % | |||||
Total Novartis Oncology business unit | 15 476 | 14 711 | 5 | 4 | |||||
Hematology | 8 363 | 7 782 | 7 | 6 | |||||
Solid Tumor | 7 113 | 6 929 | 3 | 2 | |||||
Total Novartis Pharmaceuticals business unit | 26 519 | 24 302 | 9 | 7 | |||||
Immunology, Hepatology and Dermatology | 5 777 | 4 868 | 19 | 18 | |||||
Neuroscience | 5 052 | 4 323 | 17 | 15 | |||||
Ophthalmology | 4 330 | 4 410 | -2 | -4 | |||||
Cardiovascular, Renal and Metabolism | 3 560 | 2 498 | 43 | 40 | |||||
Respiratory and Allergy | 2 065 | 1 900 | 9 | 6 | |||||
Established Medicines | 5 735 | 6 303 | -9 | -10 | |||||
Total Innovative Medicines | 41 995 | 39 013 | 8 | 6 | |||||
US | Rest of world | Total | |||||||||||||||||||
Brands | Business franchise | Key indication | USD m | % change USD/cc2 | USD m | % change USD | % change cc2 | USD m | % change USD | % change cc2 | |||||||||||
Cosentyx | Immunology, Hepatology and Dermatology | Psoriasis, ankylosing spondylitis, psoriatic arthritis and non-radiographic axial spondyloarthritis | 2 883 | 15 | 1 835 | 24 | 20 | 4 718 | 18 | 17 | |||||||||||
Entresto | Cardiovascular, Renal and Metabolism | Chronic heart failure | 1 712 | 34 | 1 836 | 50 | 45 | 3 548 | 42 | 40 | |||||||||||
Gilenya | Neuroscience | Relapsing multiple sclerosis | 1 427 | -9 | 1 360 | -6 | -8 | 2 787 | -7 | -9 | |||||||||||
Lucentis | Ophthalmology | Age-related macular degeneration | 2 160 | 12 | 8 | 2 160 | 12 | 8 | |||||||||||||
Tasigna | Hematology | Chronic myeloid leukemia | 882 | 3 | 1 178 | 7 | 5 | 2 060 | 5 | 4 | |||||||||||
Promacta/Revolade | Hematology | Immune thrombocytopenia (ITP), severe aplastic anemia (SAA) | 947 | 14 | 1 069 | 18 | 17 | 2 016 | 16 | 15 | |||||||||||
Tafinlar + Mekinist | Solid Tumor | BRAF V600+ metastatic and adjuvant melanoma; advanced non-small cell lung cancer (NSCLC) | 606 | 7 | 1 087 | 12 | 9 | 1 693 | 10 | 8 | |||||||||||
Jakavi | Hematology | Myelofibrosis (MF), polycythemia vera (PV) | 1 595 | 19 | 16 | 1 595 | 19 | 16 | |||||||||||||
Xolair 1 | Respiratory and Allergy | Severe allergic asthma (SAA), chronic spontaneous urticaria (CSU) and nasal polyps | 1 428 | 14 | 12 | 1 428 | 14 | 12 | |||||||||||||
Sandostatin | Solid Tumor | Carcinoid tumors and acromegaly | 843 | 1 | 570 | -5 | -8 | 1 413 | -2 | -3 | |||||||||||
Zolgensma | Neuroscience | Spinal muscular atrophy (SMA) | 469 | 2 | 882 | 91 | 90 | 1 351 | 47 | 46 | |||||||||||
Galvus Group | Established Medicines | Type 2 diabetes | 1 092 | -9 | -8 | 1 092 | -9 | -8 | |||||||||||||
Ilaris | Immunology, Hepatology and Dermatology | Auto-inflammatory (CAPS, TRAPS, HIDS/MKD, FMF, SJIA, AOSD and gout) | 501 | 25 | 558 | 18 | 19 | 1 059 | 21 | 22 | |||||||||||
Gleevec/Glivec | Hematology | Chronic myeloid leukemia and GIST | 263 | -17 | 761 | -13 | -15 | 1 024 | -14 | -15 | |||||||||||
Afinitor/Votubia | Solid Tumor | Breast cancer/TSC | 521 | -19 | 417 | -5 | -6 | 938 | -13 | -14 | |||||||||||
Kisqali | Solid Tumor | HR+/HER2- metastatic breast cancer | 339 | 7 | 598 | 62 | 61 | 937 | 36 | 36 | |||||||||||
Exforge Group | Established Medicines | Hypertension | 14 | -13 | 887 | -8 | -11 | 901 | -8 | -11 | |||||||||||
Diovan Group | Established Medicines | Hypertension | 51 | -59 | 722 | -18 | -20 | 773 | -23 | -25 | |||||||||||
Kymriah | Hematology | r/r pediatric and young adults ALL, DLBCL | 230 | 12 | 357 | 33 | 30 | 587 | 24 | 22 | |||||||||||
Ultibro Group | Respiratory and Allergy | Chronic obstructive pulmonary disease (COPD) | 584 | -6 | -10 | 584 | -6 | -10 | |||||||||||||
Top 20 products total | 11 688 | 7 | 20 976 | 12 | 9 | 32 664 | 10 | 8 | |||||||||||||
Rest of portfolio | 3 311 | -3 | 6 020 | 2 | 0 | 9 331 | 0 | -1 | |||||||||||||
Total division sales | 14 999 | 5 | 26 996 | 9 | 7 | 41 995 | 8 | 6 | |||||||||||||
1 Net sales reflect Xolair sales for all indications. | |||||||||||||||||||||
2 For an explanation of non-IFRS measures and reconciliation tables, see "—Non-IFRS measures as defined by Novartis." |
(USD millions) | Year ended Dec 31, 2021 | Year ended Dec 31, 2020 | Change in USD % | Change in constant currencies % | |||||
Retail Generics1 | 7 092 | 7 244 | -2 | -4 | |||||
Biopharmaceuticals | 2 116 | 1 928 | 10 | 7 | |||||
Anti-Infectives (partner label/API)1 | 423 | 474 | -11 | -12 | |||||
Total Sandoz | 9 631 | 9 646 | 0 | -2 | |||||
1 Sandoz total anti-infectives net sales amounted to USD 1.1 billion (2020: USD 1.2 billion), of which USD 707 million (2020: USD 694 million) is sold through the Retail Generics business franchise and USD 423 million (2020: USD 474 million) is sold to other third-party companies through the Anti-Infectives business franchise. |
(USD millions) | Year ended Dec 31, 2021 | % of net sales to third parties | Year ended Dec 31, 2020 | % of net sales to third parties | Change in USD % | Change in constant currencies % | |||||||
Innovative Medicines | 10 688 | 25.5 | 9 172 | 23.5 | 17 | 15 | |||||||
Sandoz | 1 600 | 16.6 | 1 043 | 10.8 | 53 | 48 | |||||||
Corporate | -599 | -63 | nm | nm | |||||||||
Operating income from continuing operations | 11 689 | 22.6 | 10 152 | 20.9 | 15 | 13 | |||||||
(USD millions unless indicated otherwise) | Year ended Dec 31, 2021 | Year ended Dec 31, 2020 | Change in USD % | Change in constant currencies % | |||||
Core gross profit from continuing operations | 41 097 | 38 663 | 6 | 5 | |||||
Selling, general and administration | -14 815 | -14 093 | -5 | -3 | |||||
Research and development | -9 041 | -8 484 | -7 | -5 | |||||
Other income | 421 | 323 | 30 | 29 | |||||
Other expense | -1 074 | -993 | -8 | -8 | |||||
Core operating income from continuing operations | 16 588 | 15 416 | 8 | 6 | |||||
As % of net sales to third parties | 32.1 | 31.7 | |||||||
1 For an explanation of non-IFRS measures and reconciliation tables, see "—Non-IFRS measures as defined by Novartis." |
(USD millions) | Year ended Dec 31, 2021 | % of net sales to third parties | Year ended Dec 31, 2020 | % of net sales to third parties | Change in USD % | Change in constant currencies % | |||||||
Innovative Medicines | 15 215 | 36.2 | 13 645 | 35.0 | 12 | 10 | |||||||
Sandoz | 2 064 | 21.4 | 2 334 | 24.2 | -12 | -14 | |||||||
Corporate | -691 | -563 | -23 | -20 | |||||||||
Core operating income from continuing operations | 16 588 | 32.1 | 15 416 | 31.7 | 8 | 6 | |||||||
(USD millions unless indicated otherwise) | Year ended Dec 31, 2021 | Year ended Dec 31, 2020 | Change in USD % | Change in constant currencies % | |||||
Research and exploratory development | -3 209 | -2 737 | -17 | -16 | |||||
Confirmatory development | -5 432 | -5 381 | -1 | 1 | |||||
Total Innovative Medicines Division research and development expense | -8 641 | -8 118 | -6 | -5 | |||||
As % of Innovative Medicines net sales to third parties | 20.6 | 20.8 | |||||||
Core research and exploratory development1 | -2 809 | -2 682 | -5 | -4 | |||||
Core confirmatory development1 | -5 341 | -4 954 | -8 | -6 | |||||
Total core Innovative Medicines Division research and development expense | -8 150 | -7 636 | -7 | -5 | |||||
As % of Innovative Medicines net sales to third parties | 19.4 | 19.6 | |||||||
1 Core results exclude impairments, amortization and certain other items. For an explanation of non-IFRS measures and reconciliation tables, see "—Non-IFRS measures as defined by Novartis." |
(USD millions unless indicated otherwise) | Year ended Dec 31, 2021 | Year ended Dec 31, 2020 | Change in USD % | Change in constant currencies % | |||||
Operating income from continuing operations | 11 689 | 10 152 | 15 | 13 | |||||
Income from associated companies | 15 339 | 673 | nm | nm | |||||
Interest expense | -811 | -869 | 7 | 6 | |||||
Other financial income and expense | -80 | -78 | -3 | 44 | |||||
Income before taxes from continuing operations | 26 137 | 9 878 | 165 | 163 | |||||
Income taxes | -2 119 | -1 807 | -17 | -17 | |||||
Net income | 24 018 | 8 071 | 198 | 195 | |||||
Attributable to: | |||||||||
Shareholders of Novartis AG | 24 021 | 8 072 | 198 | 195 | |||||
Non-controlling interests | -3 | -1 | -200 | -200 | |||||
Total basic earnings per share (USD) | 10.71 | 3.55 | 202 | 200 | |||||
nm = not meaningful |
(USD millions unless indicated otherwise) | Year ended Dec 31, 2021 | Year ended Dec 31, 2020 | Change in USD % | Change in constant currencies % | |||||
Core operating income from continuing operations | 16 588 | 15 416 | 8 | 6 | |||||
Core income from associated companies | 993 | 1 097 | -9 | -9 | |||||
Core interest expense | -811 | -869 | 7 | 6 | |||||
Core other financial income and expense | -41 | -83 | 51 | 39 | |||||
Core income before taxes from continuing operations | 16 729 | 15 561 | 8 | 6 | |||||
Core income taxes | -2 635 | -2 403 | -10 | -8 | |||||
Core net income | 14 094 | 13 158 | 7 | 5 | |||||
Core basic earnings per share (USD) | 6.29 | 5.78 | 9 | 7 | |||||
(USD millions) | 2021 | 2020 | |||
Operating income from continuing operations | 11 689 | 10 152 | |||
Depreciation of property, plant and equipment | 1 208 | 1 318 | |||
Depreciation of the right-of-use-assets | 318 | 330 | |||
Amortization of intangible assets | 3 903 | 3 462 | |||
Impairments of property, plant and equipment, and intangible assets 1 | 684 | 1 354 | |||
EBITDA total Group | 17 802 | 16 616 | |||
1 There were no impairments of right-of-use assets in 2021 and 2020. |
(USD millions) | Dec 31, 2021 | Dec 31, 2020 | |||
Market capitalization | 196 107 | 214 269 | |||
Non-controlling interests | 167 | 68 | |||
Non-current financial debts | 22 902 | 26 259 | |||
Current financial debts and derivatives financial instruments | 6 295 | 9 785 | |||
Marketable securities, commodities, time deposits and derivative financial instruments | -15 922 | -1 905 | |||
Cash and cash equivalents | -12 407 | -9 658 | |||
Enterprise value | 197 142 | 238 818 | |||
Innovative Medicines | Sandoz | Corporate | Group | ||||||||||||||
(USD millions unless indicated otherwise) | 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | |||||||||
IFRS operating income from continuing operations | 10 688 | 9 172 | 1 600 | 1 043 | -599 | -63 | 11 689 | 10 152 | |||||||||
Amortization of intangible assets | 3 528 | 2 999 | 236 | 366 | 3 764 | 3 365 | |||||||||||
Impairments | |||||||||||||||||
Intangible assets | 360 | 759 | 27 | 141 | 387 | 900 | |||||||||||
Property, plant and equipment related to the Group-wide rationalization of manufacturing sites | 219 | 321 | 7 | 112 | 226 | 433 | |||||||||||
Other property, plant and equipment | 40 | 2 | 40 | 2 | |||||||||||||
Total impairment charges | 619 | 1 080 | 34 | 255 | 653 | 1 335 | |||||||||||
Acquisition or divestment of businesses and related items | |||||||||||||||||
- Income | -2 | -5 | -64 | -73 | -66 | -78 | |||||||||||
- Expense | 1 | 107 | 22 | 106 | 89 | 107 | 218 | ||||||||||
Total acquisition or divestment of businesses and related items, net | -1 | 102 | 22 | 42 | 16 | 41 | 140 | ||||||||||
Other items | |||||||||||||||||
Divestment gains | -649 | -348 | -4 | -27 | -75 | -39 | -728 | -414 | |||||||||
Financial assets - fair value adjustments | -43 | -153 | 5 | -183 | -38 | -336 | |||||||||||
Restructuring and related items | |||||||||||||||||
- Income | -32 | -36 | -36 | -30 | -6 | -28 | -74 | -94 | |||||||||
- Expense | 833 | 484 | 193 | 252 | 32 | 35 | 1 058 | 771 | |||||||||
Legal-related items | |||||||||||||||||
- Income | -11 | -11 | |||||||||||||||
- Expense | 170 | 555 | 53 | 406 | -26 | 223 | 935 | ||||||||||
Additional income | -139 | -264 | -1 | -6 | -138 | -361 | -278 | -631 | |||||||||
Additional expense | 241 | 54 | 53 | 48 | 86 | 289 | 193 | ||||||||||
Total other items | 381 | 292 | 194 | 648 | -134 | -516 | 441 | 424 | |||||||||
Total adjustments | 4 527 | 4 473 | 464 | 1 291 | -92 | -500 | 4 899 | 5 264 | |||||||||
Core operating income from continuing operations | 15 215 | 13 645 | 2 064 | 2 334 | -691 | -563 | 16 588 | 15 416 | |||||||||
as % of net sales | 36.2% | 35.0% | 21.4% | 24.2% | 32.1% | 31.7% | |||||||||||
Income from associated companies | 5 | 1 | 2 | 2 | 15 332 | 670 | 15 339 | 673 | |||||||||
Core adjustments to income from associated companies, net of tax | -14 346 | 424 | -14 346 | 424 | |||||||||||||
Interest expense | -811 | -869 | |||||||||||||||
Other financial income and expense | -80 | -78 | |||||||||||||||
Core adjustments to other financial income and expense | 39 | -5 | |||||||||||||||
Income taxes, adjusted for above items (core income taxes) | -2 635 | -2 403 | |||||||||||||||
Core net income | 14 094 | 13 158 | |||||||||||||||
Core net income attributable to shareholders of Novartis AG | 14 097 | 13 159 | |||||||||||||||
Core basic EPS (USD) 1 | 6.29 | 5.78 | |||||||||||||||
1 Earnings per share (EPS) is calculated on the amount of net income attributable to shareholders of Novartis AG. |
2021 (USD millions unless indicated otherwise) | IFRS results | Amortization of intangible assets1 | Impairments2 | Acquisition or divestment of businesses and related items3 | Other items4 | Core results | |||||||
Gross profit from continuing operations | 37 010 | 3 655 | 18 | 414 | 41 097 | ||||||||
Operating income from continuing operations | 11 689 | 3 764 | 653 | 41 | 441 | 16 588 | |||||||
Income before taxes from continuing operations | 26 137 | 3 974 | 653 | -14 531 | 496 | 16 729 | |||||||
Income taxes 5 | -2 119 | -2 635 | |||||||||||
Net income | 24 018 | 14 094 | |||||||||||
Basic EPS (USD) 6 | 10.71 | 6.29 | |||||||||||
The following are adjustments to arrive at core gross profit | |||||||||||||
Cost of goods sold | -15 867 | 3 655 | 18 | 414 | -11 780 | ||||||||
The following are adjustments to arrive at core operating income | |||||||||||||
Selling, general and administration | -14 886 | 71 | -14 815 | ||||||||||
Research and development | -9 540 | 109 | 369 | 21 | -9 041 | ||||||||
Other income | 1 852 | -100 | -66 | -1 265 | 421 | ||||||||
Other expense | -2 747 | 366 | 107 | 1 200 | -1 074 | ||||||||
The following are adjustments to arrive at core income before taxes | |||||||||||||
Income from associated companies | 15 339 | 210 | -14 556 | 993 | |||||||||
Other financial income and expense | -80 | -16 | 55 | -41 | |||||||||
1 Amortization of intangible assets: cost of goods sold includes the amortization of acquired rights to currently marketed products and other production-related intangible assets; research and development includes the amortization of acquired rights for technologies; income from associated companies includes USD 210 million for the Novartis share of the estimated Roche core items | |||||||||||||
2 Impairments: cost of goods sold and research and development include impairment charges related to intangible assets; other income and other expense include reversals of impairment charges and impairment charges related to property, plant and equipment | |||||||||||||
3 Acquisition or divestment of businesses and related items, including restructuring and integration charges: other income includes adjustments to portfolio transformation and Alcon spin-off accruals; other income and other expense include transitional service-fee income and expenses related to the Alcon distribution; other expense also includes adjustments to provisions; income from associated companies includes the gain related to the divestment of our investment in Roche; other financial income and expense includes other financial gains related to the divestment of our investment in Roche | |||||||||||||
4 Other items: cost of goods sold, research and development, other income and other expense include net restructuring and other charges related to the Group-wide rationalization of manufacturing sites; cost of goods sold, selling, general and administration, other income and other expense include other restructuring income and charges and related items; cost of goods sold, research and development, other income and other expense also include adjustments to contingent considerations; selling, general and administration, research and development, other income and other expense include adjustments to provisions; other income and other expense also include gains and losses from the divestment of products and financial assets and fair value adjustments on financial assets, adjustments to environmental provisions and legal-related items; other financial income and expense includes a charge related to the monetary loss due to hyperinflation in Argentina and Venezuela and a revaluation impact of a financial liability incurred through the Alcon distribution | |||||||||||||
5 Taxes on the adjustments between IFRS and core results take into account, for each individual item included in the adjustment, the tax rate that will finally be applicable to the item based on the jurisdiction where the adjustment will finally have a tax impact. Generally, this results in amortization and impairment of intangible assets and acquisition-related restructuring and integration items having a full tax impact. There is usually a tax impact on other items, although this is not always the case for items arising from legal settlements in certain jurisdictions. Adjustments related to income from associated companies are recorded net of any related tax effect. Due to these factors and the differing effective tax rates in the various jurisdictions, the tax on the total adjustments of USD 9.4 billion to arrive at the core results before tax amounts to USD 516 million. Excluding the gain on the divestment of our investment in Roche, the tax on the total adjustments of USD 5.2 billion to arrive at the core results before tax amounts to USD 516 million and the average tax rate on the adjustments was 10.0%. | |||||||||||||
6 Earnings per share (EPS) is calculated on the amount of net income attributable to shareholders of Novartis AG. |
2020 (USD millions unless indicated otherwise) | IFRS results | Amortization of intangible assets1 | Impairments2 | Acquisition or divestment of businesses and related items3 | Other items4 | Core results | |||||||
Gross profit from continuing operations | 34 777 | 3 301 | 377 | 70 | 138 | 38 663 | |||||||
Operating income from continuing operations | 10 152 | 3 365 | 1 335 | 140 | 424 | 15 416 | |||||||
Income before taxes from continuing operations | 9 878 | 3 789 | 1 335 | 140 | 419 | 15 561 | |||||||
Income taxes 5 | -1 807 | -2 403 | |||||||||||
Net income | 8 071 | 13 158 | |||||||||||
Basic EPS (USD) 6 | 3.55 | 5.78 | |||||||||||
The following are adjustments to arrive at core gross profit | |||||||||||||
Other revenues | 1 239 | -136 | 1 103 | ||||||||||
Cost of goods sold | -15 121 | 3 301 | 377 | 70 | 274 | -11 099 | |||||||
The following are adjustments to arrive at core operating income | |||||||||||||
Selling, general and administration | -14 197 | 16 | 88 | -14 093 | |||||||||
Research and development | -8 980 | 64 | 523 | 3 | -94 | -8 484 | |||||||
Other income | 1 742 | -6 | -78 | -1 335 | 323 | ||||||||
Other expense | -3 190 | 441 | 129 | 1 627 | -993 | ||||||||
The following are adjustments to arrive at core income before taxes | |||||||||||||
Income from associated companies | 673 | 424 | 1 097 | ||||||||||
Other financial income and expense | -78 | -5 | -83 | ||||||||||
1 Amortization of intangible assets: cost of goods sold includes the amortization of acquired rights to currently marketed products and other production-related intangible assets; research and development includes the amortization of acquired rights for technologies; income from associated companies includes USD 424 million for the Novartis share of the estimated Roche core items | |||||||||||||
2 Impairments: cost of goods sold and research and development include impairment charges related to intangible assets; other income includes an impairment reversal related to property, plant and equipment; other expense includes impairment charges related to property, plant and equipment | |||||||||||||
3 Acquisition or divestment of businesses and related items, including restructuring and integration charges: cost of goods sold, selling, general and administration, research and development and other expense include net charges related to acquisitions; other income and other expense include transitional service-fee income and expenses related to the Alcon distribution | |||||||||||||
4 Other items: other revenues includes a settlement of royalties; cost of goods sold includes the cumulative amount of the depreciation up to December 31, 2019, recognized with the reclassification of property, plant and equipment out of assets of disposal group held for sale (see Item 18. Financial Statements–Note 2. Significant transactions–Significant transactions in 2020); cost of goods sold, other income and other expense include net restructuring and other charges related to the Group-wide rationalization of manufacturing sites; cost of goods sold, selling, general and administration, research and development, other income and other expense include other restructuring income and charges and related items; cost of goods sold and research and development also include adjustments to contingent considerations; selling, general and administration and other expense include expenses related to COVID-19 donations; selling, general and administration also includes adjustments to provisions; other income and other expense include fair value adjustments and divestment gains and losses on financial assets, and adjustments to environmental provisions; other income also includes net gains from the divestment of products, a fair value adjustment on a contingent receivable and adjustments to provisions; other expense includes adjustments to legal provisions, legal-related items and a termination fee; other financial income and expense includes a revaluation impact of a financial liability incurred through the Alcon distribution | |||||||||||||
5 Income taxes on the adjustments between IFRS and core results take into account, for each individual item included in the adjustment, the tax rate that will finally be applicable to the item based on the jurisdiction where the adjustment will finally have a tax impact. Generally, this results in amortization and impairment of intangible assets and acquisition-related restructuring and integration items having a full tax impact. There is usually a tax impact on other items, although this is not always the case for items arising from legal settlements in certain jurisdictions. Adjustments related to income from associated companies are recorded net of any related tax effect. Due to these factors and the differing effective tax rates in the various jurisdictions, the tax on the total adjustments for continuing operations of USD 5.7 billion to arrive at the core results before tax amounts to USD 596 million. The average tax rate on the adjustments is 10.5%. | |||||||||||||
6 Earnings per share (EPS) is calculated on the amount of net income, attributable to shareholders of Novartis AG. |
2021 (USD millions) | IFRS results | Amortization of intangible assets1 | Impairments2 | Acquisition or divestment of businesses and related items3 | Other items4 | Core results | |||||||
Gross profit | 32 218 | 3 419 | 344 | 35 981 | |||||||||
Operating income | 10 688 | 3 528 | 619 | -1 | 381 | 15 215 | |||||||
The following are adjustments to arrive at core gross profit | |||||||||||||
Cost of goods sold | -11 751 | 3 419 | 344 | -7 988 | |||||||||
The following are adjustments to arrive at core operating income | |||||||||||||
Selling, general and administration | -12 306 | 71 | -12 235 | ||||||||||
Research and development | -8 641 | 109 | 360 | 22 | -8 150 | ||||||||
Other income | 1 149 | -45 | -2 | -837 | 265 | ||||||||
Other expense | -1 732 | 304 | 1 | 781 | -646 | ||||||||
1 Amortization of intangible assets: cost of goods sold includes the amortization of acquired rights to currently marketed products and other production-related intangible assets; research and development includes the amortization of acquired rights for technologies | |||||||||||||
2 Impairments: research and development includes impairment charges related to intangible assets; other income and other expense include reversals of impairment charges and impairment charges related to property, plant and equipment | |||||||||||||
3 Acquisition or divestment of businesses and related items, including restructuring and integration charges: other income and other expense include transitional service fee income and expenses related to the Alcon distribution | |||||||||||||
4 Other items: cost of goods sold, research and development, other income and other expense include net restructuring and other charges related to the Group-wide rationalization of manufacturing sites; cost of goods sold, selling, general and administration, other income and other expense include other restructuring income and charges and related items; cost of goods sold, research and development and other expense include adjustments to contingent considerations; selling, general and administration, research and development and other expense include adjustments to provisions; other income and other expense include gains and losses from the divestment of products and financial assets and fair value adjustments on financial assets; other expense also includes legal-related items and adjustments to environmental provisions |
2020 (USD millions) | IFRS results | Amortization of intangible assets1 | Impairments2 | Acquisition or divestment of businesses and related items3 | Other items4 | Core results | |||||||
Gross profit | 29 896 | 2 935 | 250 | 48 | 146 | 33 275 | |||||||
Operating income | 9 172 | 2 999 | 1 080 | 102 | 292 | 13 645 | |||||||
The following are adjustments to arrive at core gross profit | |||||||||||||
Cost of goods sold | -10 927 | 2 935 | 250 | 48 | 146 | -7 548 | |||||||
The following are adjustments to arrive at core operating income | |||||||||||||
Selling, general and administration | -11 657 | 16 | 58 | -11 583 | |||||||||
Research and development | -8 118 | 64 | 509 | 3 | -94 | -7 636 | |||||||
Other income | 922 | -1 | -5 | -687 | 229 | ||||||||
Other expense | -1 871 | 322 | 40 | 869 | -640 | ||||||||
1 Amortization of intangible assets: cost of goods sold includes the amortization of acquired rights to currently marketed products and other production-related intangible assets; research and development includes the amortization of acquired rights for technologies | |||||||||||||
2 Impairments: cost of goods sold and research and development include impairment charges related to intangible assets; other income and other expense include net impairment charges related to property, plant and equipment | |||||||||||||
3 Acquisition or divestment of businesses and related items, including restructuring and integration charges: cost of goods sold, selling, general and administration, research and development and other expense include net charges related to acquisitions; other income and other expense include transitional service-fee income and expenses related to the Alcon distribution | |||||||||||||
4 Other items: cost of goods sold, other income and other expense include net restructuring and other charges related to the Group-wide rationalization of manufacturing sites; cost of goods sold, selling, general and administration, research and development, other income and other expense include other restructuring income and charges and related items; cost of goods sold and research and development also include adjustments to contingent considerations; selling, general and administration includes expenses related to COVID-19 donations and adjustments to provisions; other income and other expense include fair value adjustments on financial assets; other income also includes net gains from the divestment of products and financial assets and adjustments to provisions; other expense includes legal-related items and a termination fee |
2021 (USD millions) | IFRS results | Amortization of intangible assets1 | Impairments2 | Acquisition or divestment of businesses and related items | Other items3 | Core results | |||||||
Gross profit | 4 725 | 236 | 18 | 70 | 5 049 | ||||||||
Operating income | 1 600 | 236 | 34 | 194 | 2 064 | ||||||||
The following are adjustments to arrive at core gross profit | |||||||||||||
Cost of goods sold | -5 147 | 236 | 18 | 70 | -4 823 | ||||||||
The following are adjustments to arrive at core operating income | |||||||||||||
Research and development | -899 | 9 | -1 | -891 | |||||||||
Other income | 233 | -55 | -51 | 127 | |||||||||
Other expense | -397 | 62 | 176 | -159 | |||||||||
1 Amortization of intangible assets: cost of goods sold includes the amortization of acquired rights to currently marketed products and other production-related intangible assets | |||||||||||||
2 Impairments: cost of goods sold and research and development include impairment charges related to intangible assets; other income and other expense include reversals of impairment charges and impairment charges related to property, plant and equipment | |||||||||||||
3 Other items: cost of goods sold, other income and other expense include net restructuring and other charges related to the Group-wide rationalization of manufacturing sites and other restructuring income and charges and related items; research and development includes adjustments to provisions; other income includes net gains from the divestment of a product; other income and other expense include legal-related items |
2020 (USD millions) | IFRS results | Amortization of intangible assets1 | Impairments2 | Acquisition or divestment of businesses and related items3 | Other items4 | Core results | |||||||
Gross profit | 4 636 | 366 | 127 | 22 | 128 | 5 279 | |||||||
Operating income | 1 043 | 366 | 255 | 22 | 648 | 2 334 | |||||||
The following are adjustments to arrive at core gross profit | |||||||||||||
Cost of goods sold | -5 252 | 366 | 127 | 22 | 128 | -4 609 | |||||||
The following are adjustments to arrive at core operating income | |||||||||||||
Selling, general and administration | -2 076 | 30 | -2 046 | ||||||||||
Research and development | -862 | 14 | -848 | ||||||||||
Other income | 176 | -5 | -62 | 109 | |||||||||
Other expense | -831 | 119 | 552 | -160 | |||||||||
1 Amortization of intangible assets: cost of goods sold includes the amortization of acquired rights to currently marketed products and other production-related intangible assets | |||||||||||||
2 Impairments: cost of goods sold and research and development include impairment charges related to intangible assets; other income includes an impairment reversal related to property, plant and equipment; other expense includes impairment charges related to property, plant and equipment | |||||||||||||
3 Acquisition or divestment of businesses and related items, including restructuring and integration charges: cost of goods sold includes net charges related to an acquisition | |||||||||||||
4 Other items: cost of goods sold includes the cumulative amount of the depreciation up to December 31, 2019, recognized with the reclassification of property, plant and equipment out of assets of disposal group held for sale (see Item 18. Financial Statements–Note 2. Significant transactions–Significant transactions in 2020); cost of goods sold and other expense include restructuring and other charges related to the Group-wide rationalization of manufacturing sites; cost of goods sold, selling, general and administration, other income and other expense include other restructuring income and charges and related items; selling, general and administration also includes expenses related to COVID-19 donations and adjustments to provisions; other income includes net gains from the divestment of a product and adjustments to provisions; other expense includes a legal provision and legal-related items |
2021 (USD millions) | IFRS results | Amortization of intangible assets | Impairments | Acquisition or divestment of businesses and related items1 | Other items2 | Core results | |||||||
Gross profit | 67 | 67 | |||||||||||
Operating loss | -599 | 42 | -134 | -691 | |||||||||
The following are adjustments to arrive at core operating loss | |||||||||||||
Other income | 470 | -64 | -377 | 29 | |||||||||
Other expense | -618 | 106 | 243 | -269 | |||||||||
1 Acquisition or divestment of businesses and related items, including restructuring and integration charges: other income includes adjustments to portfolio transformation and Alcon spin-off accruals; other income and other expense include transitional service fee income and expenses related to the Alcon distribution; other expense also includes adjustments to provisions | |||||||||||||
2 Other items: other income includes an adjustment to a contingent consideration receivable; other income and other expense include fair value adjustments and divestment gains and losses on financial assets, adjustments to environmental provisions and restructuring income and charges and related items |
2020 (USD millions) | IFRS results | Amortization of intangible assets | Impairments | Acquisition or divestment of businesses and related items1 | Other items2 | Core results | |||||||
Gross profit | 245 | -136 | 109 | ||||||||||
Operating loss | -63 | 16 | -516 | -563 | |||||||||
The following are adjustments to arrive at Core Gross profit | |||||||||||||
Other revenues | 168 | -136 | 32 | ||||||||||
The following are adjustments to arrive at core operating loss | |||||||||||||
Other income | 644 | -73 | -586 | -15 | |||||||||
Other expense | -488 | 89 | 206 | -193 | |||||||||
1 Acquisition or divestment of businesses and related items, including restructuring and integration charges: other income and other expense include transitional service fee income and expenses related to the Alcon distribution | |||||||||||||
2 Other items: other revenues includes a settlement of royalties; other income and other expense include fair value adjustments and divestment gains and losses on financial assets, adjustments to environmental provisions and restructuring income and charges and related items; other income also includes a fair value adjustment on a contingent receivable and adjustments to provisions; other expense includes adjustments to legal provisions and expenses related to COVID-19 donations |
5.B Liquidity and capital resources
(USD millions) | 2021 | 2020 | |||
Net cash flows from operating activities from continuing operations | 15 071 | 13 650 | |||
Net cash flows from/used in investing activities from continuing operations | 4 208 | -13 055 | |||
Net cash flows used in investing activities from discontinued operations | -127 | ||||
Net cash flows used in financing activities from continuing operations | -16 264 | -2 158 | |||
Net cash flows used in financing activities from discontinued operations | -50 | ||||
Effect of exchange rate changes on cash and cash equivalents | -266 | 286 | |||
Net change in cash and cash equivalents | 2 749 | -1 454 | |||
Change in marketable securities, commodities, time deposits and derivative financial instruments | 14 017 | 1 571 | |||
Change in current and non-current financial debts and derivative financial instruments | 6 847 | -8 660 | |||
Change in net debt | 23 613 | -8 543 | |||
Net debt at January 1 | -24 481 | -15 938 | |||
Net debt at December 31 | -868 | -24 481 | |||
2021 | 2020 | ||||||||||||
(USD millions) | IFRS cash flow | Adjustments | Free cash flow | IFRS cash flow | Adjustments | Free cash flow | |||||||
Net cash flows from operating activities from continuing operations | 15 071 | 15 071 | 13 650 | 13 650 | |||||||||
Net cash flows from/used in investing activities from continuing operations 1,2 | 4 208 | -5 997 | -1 789 | -13 055 | 11 096 | -1 959 | |||||||
Net cash flows used in investing activities from discontinued operations 3 | -127 | 127 | 0 | ||||||||||
Net cash flows from/used in investing activities | 4 208 | -5 997 | -1 789 | -13 182 | 11 223 | -1 959 | |||||||
Net cash flows used in financing activities from continuing operations 4 | -16 264 | 16 264 | 0 | -2 158 | 2 158 | 0 | |||||||
Net cash flows used in financing activities from discontinued operations 3 | -50 | 50 | 0 | ||||||||||
Net cash flows used in financing activities | -16 264 | 16 264 | 0 | -2 208 | 2 208 | 0 | |||||||
Free cash flow | 13 282 | 11 691 | |||||||||||
1 Excluded from the free cash flow are cash flows from investing activities associated with acquisitions and divestments of businesses and of interest in associated companies, purchases and sales of marketable securities, commodities and time deposits. | |||||||||||||
2 For the free cash flow in 2020, proceeds from the sale of financial assets exclude the cash inflows from the sale of a portion of the Alcon Inc. shares received by certain consolidated foundations through the Alcon spin-off, which amounted to USD 276 million. | |||||||||||||
3 Net cash flows used in investing activities from discontinued operations are activities associated with acquisitions and divestments of businesses which are excluded from the free cash flow. Net cash flows used in financing activities from discontinued operations are excluded from free cash flow. Free cash flow from discontinued operations was nil in 2021 and 2020. | |||||||||||||
4 Net cash flows used in financing activities are excluded from the free cash flow. |
(USD millions) | 2021 | 2020 | |||
Operating income from continuing operations | 11 689 | 10 152 | |||
Adjustments for non-cash items | |||||
Depreciation, amortization and impairments | 6 075 | 6 129 | |||
Change in provisions and other non-current liabilities | 896 | 1 411 | |||
Other | 59 | 260 | |||
Operating income from continuing operations adjusted for non-cash items | 18 719 | 17 952 | |||
Dividends received from associated companies and others | 525 | 490 | |||
Interest and other financial receipts | 13 | 511 | |||
Interest and other financial payments | -966 | -742 | |||
Income taxes paid | -2 342 | -1 833 | |||
Payments out of provisions and other net cash movements in non-current liabilities | -1 119 | -2 437 | |||
Change in inventory and trade receivables less trade payables | -329 | -730 | |||
Change in other net current assets and other operating cash flow items | 570 | 439 | |||
Net cash flows from operating activities from continuing operations | 15 071 | 13 650 | |||
Purchases of property, plant and equipment | -1 378 | -1 275 | |||
Proceeds from sale of property, plant and equipment | 240 | 88 | |||
Purchases of intangible assets | -1 593 | -1 310 | |||
Proceeds from sale of intangible assets | 748 | 380 | |||
Purchases of financial assets | -191 | -230 | |||
Proceeds from sale of financial assets 1 | 442 | 447 | |||
Purchases of other non-current assets | -61 | -61 | |||
Proceeds from sale of other non-current assets | 4 | 2 | |||
Free cash flow | 13 282 | 11 691 | |||
1 For the free cash flow in 2020, proceeds from the sale of financial assets exclude the cash inflows from the sale of a portion of the Alcon Inc. shares received by certain consolidated foundations through the Alcon spin-off, which amounted to USD 276 million. See "Item 18. Financial Statements–Note 2. Significant transactions–Significant transactions in 2019." |
(USD millions) | Dec 31, 2021 | Dec 31, 20201 | |||
Assets | |||||
Property, plant and equipment | 11 545 | 12 263 | |||
Right-of-use assets | 1 561 | 1 676 | |||
Goodwill | 29 595 | 29 999 | |||
Intangible assets other than goodwill | 34 182 | 36 809 | |||
Investments in associated companies | 205 | 9 632 | |||
Deferred tax assets | 3 743 | 3 933 | |||
Financial assets and other non-current assets | 5 246 | 3 793 | |||
Total non-current assets | 86 077 | 98 105 | |||
Inventories | 6 666 | 7 131 | |||
Trade receivables | 8 005 | 8 217 | |||
Other current assets and income tax receivables | 2 718 | 2 762 | |||
Marketable securities, commodities, time deposits and derivative financial instruments | 15 922 | 1 905 | |||
Cash and cash equivalents | 12 407 | 9 658 | |||
Total current assets | 45 718 | 29 673 | |||
Total assets | 131 795 | 127 778 | |||
Equity and liabilities | |||||
Total equity | 67 822 | 56 666 | |||
Liabilities | |||||
Financial debts | 22 902 | 26 259 | |||
Lease liabilities | 1 621 | 1 719 | |||
Deferred tax liabilities | 3 070 | 3 141 | |||
Provisions and other non-current liabilities | 6 172 | 6 934 | |||
Total non-current liabilities | 33 765 | 38 053 | |||
Trade payables | 5 553 | 5 403 | |||
Financial debts and derivative financial instruments | 6 295 | 9 785 | |||
Lease liabilities | 275 | 286 | |||
Provisions and other current liabilities and current income tax liabilities | 18 085 | 17 585 | |||
Total current liabilities | 30 208 | 33 059 | |||
Total liabilities | 63 973 | 71 112 | |||
Total equity and liabilities | 131 795 | 127 778 | |||
1 The December 31, 2020 deferred tax assets and deferred tax liabilities balances have been adjusted to conform with the 2021 presentation, see “Item 18. Financial Statements–Note 12. Deferred tax assets and liabilities.” |
Number of outstanding shares (in millions) | Equity attributable to Novartis AG shareholders | ||||||||
2021 | 2020 | 2021 USD millions | 2020 USD millions | ||||||
Balance at beginning of year | 2 256.8 | 2 265.0 | 56 598 | 55 474 | |||||
Shares acquired to be canceled | -30.7 | -32.6 | -2 775 | -2 897 | |||||
Other share purchases | -1.5 | -1.7 | -145 | -159 | |||||
Exercise of options and employee transactions | 0.6 | 14.7 | 39 | 806 | |||||
Repurchase of options | -89 | ||||||||
Equity-based compensation | 9.6 | 11.0 | 745 | 730 | |||||
Shares delivered to Alcon employees as a result of the Alcon spin-off | 0.1 | 0.4 | 17 | 30 | |||||
Taxes on treasury share transactions | 1 | 32 | |||||||
Increase of treasury share repurchase obligation under a share buyback trading plan | -1 040 | -1 769 | |||||||
Transaction costs, net of taxes | 12 | ||||||||
Dividends | -7 368 | -6 987 | |||||||
Net income of the year attributable to shareholders of Novartis AG | 24 021 | 8 072 | |||||||
Other comprehensive income attributable to shareholders of Novartis AG | -2 493 | 3 331 | |||||||
Impact of change in ownership of consolidated entities | -5 | 6 | |||||||
Other movements 1 | 48 | 18 | |||||||
Balance at end of year | 2 234.9 | 2 256.8 | 67 655 | 56 598 | |||||
1 Impact of hyperinflationary economies (see “Item 18. Financial Statements—Note 1. Significant accounting policies"). |
2021 | 2020 | ||||||||
Currency | Net sales % | Operating expenses %1 | Net sales % | Operating expenses %1 | |||||
US dollar (USD) | 35 | 35 | 36 | 34 | |||||
Euro (EUR) | 29 | 26 | 29 | 27 | |||||
Swiss franc (CHF) | 2 | 18 | 2 | 18 | |||||
Chinese yuan (CNY) | 6 | 3 | 5 | 3 | |||||
Japanese yen (JPY) | 5 | 3 | 6 | 3 | |||||
Canadian dollar (CAD) | 3 | 2 | 3 | 1 | |||||
British pound (GBP) | 3 | 2 | 2 | 3 | |||||
Russian ruble (RUB) | 2 | 1 | 2 | 1 | |||||
Brazilian real (BRL) | 1 | 1 | 2 | 1 | |||||
Australian dollar (AUD) | 1 | 1 | 1 | 1 | |||||
Other currencies | 13 | 8 | 12 | 8 | |||||
1 Operating expenses include cost of goods sold; selling, general and administration; research and development; other income and other expense. |
Average for year | Year-end | ||||||||||||
USD per unit | 2021 | 2020 | Change in % | 2021 | 2020 | Change in % | |||||||
Australian dollar (AUD) | 0.752 | 0.690 | 9 | 0.726 | 0.771 | -6 | |||||||
Brazilian real (BRL) | 0.186 | 0.196 | -5 | 0.180 | 0.193 | -7 | |||||||
Canadian dollar (CAD) | 0.798 | 0.746 | 7 | 0.785 | 0.784 | 0 | |||||||
Swiss franc (CHF) | 1.094 | 1.066 | 3 | 1.093 | 1.135 | -4 | |||||||
Chinese yuan (CNY) | 0.155 | 0.145 | 7 | 0.157 | 0.153 | 3 | |||||||
Euro (EUR) | 1.183 | 1.141 | 4 | 1.131 | 1.229 | -8 | |||||||
British pound (GBP) | 1.376 | 1.283 | 7 | 1.351 | 1.365 | -1 | |||||||
Japanese yen (JPY (100)) | 0.912 | 0.937 | -3 | 0.868 | 0.970 | -11 | |||||||
Russian ruble (RUB (100)) | 1.357 | 1.389 | -2 | 1.336 | 1.337 | 0 | |||||||
Change in USD % 2021 | Change in constant currencies % 2021 | Percentage point currency impact 2021 | Change in USD % 2020 | Change in constant currencies % 2020 | Percentage point currency impact 2020 | ||||||||
Total Group | |||||||||||||
Net sales to third parties from continuing operations | 6 | 4 | 2 | 3 | 3 | 0 | |||||||
Operating income from continuing operations | 15 | 13 | 2 | 12 | 19 | -7 | |||||||
Net income | 198 | 195 | 3 | 13 | 20 | -7 | |||||||
Basic earnings per share (USD) | 202 | 200 | 2 | 14 | 21 | -7 | |||||||
Core operating income from continuing operations | 8 | 6 | 2 | 9 | 13 | -4 | |||||||
Core net income | 7 | 5 | 2 | 9 | 12 | -3 | |||||||
Core basic earnings per share (USD) | 9 | 7 | 2 | 9 | 13 | -4 | |||||||
Innovative Medicines | |||||||||||||
Net sales to third parties | 8 | 6 | 2 | 3 | 4 | -1 | |||||||
Operating income | 17 | 15 | 2 | -1 | 4 | -5 | |||||||
Core operating income | 12 | 10 | 2 | 8 | 11 | -3 | |||||||
Sandoz | |||||||||||||
Net sales to third parties | 0 | -2 | 2 | -1 | 0 | -1 | |||||||
Operating income | 53 | 48 | 5 | 89 | 106 | -17 | |||||||
Core operating income | -12 | -14 | 2 | 11 | 15 | -4 | |||||||
Corporate | |||||||||||||
Operating loss from continuing operations | nm | nm | nm | nm | nm | nm | |||||||
Core operating loss from continuing operations | -23 | -20 | -3 | 11 | 14 | -3 | |||||||
nm = not meaningful |
(USD millions) | 2021 | 2020 | |||
Non-current financial debts | -22 902 | -26 259 | |||
Current financial debts and derivative financial instruments | -6 295 | -9 785 | |||
Total financial debts | -29 197 | -36 044 | |||
Less liquidity | |||||
Cash and cash equivalents | 12 407 | 9 658 | |||
Marketable securities, commodities, time deposits and derivative financial instruments | 15 922 | 1 905 | |||
Total liquidity | 28 329 | 11 563 | |||
Net debt at December 31 1 | -868 | -24 481 | |||
1 For further information about the net debt measure, which is a non-IFRS measure, see “—Item 5.A Operating results—Non-IFRS measures as defined by Novartis—Net debt.” |
Liquidity in % 20211 | Liquidity in % 20201 | Financial debt in % 20212 | Financial debt in % 20202 | ||||||
USD | 92 | 57 | 57 | 55 | |||||
CHF | 4 | 11 | 12 | 10 | |||||
EUR | 2 | 23 | 27 | 30 | |||||
JPY | 1 | 2 | |||||||
Other | 2 | 9 | 3 | 3 | |||||
100 | 100 | 100 | 100 | ||||||
1 Liquidity includes cash and cash equivalents and marketable securities, including debt securities, commodities and time deposits. | |||||||||
2 Financial debt includes non-current and current financial debt. |
Payments due by period | |||||||||||
(USD millions) | Total | Less than 1 year | 2–3 years | 4–5 years | After 5 years | ||||||
Non-current financial debt, including current portion | 25 523 | 2 621 | 4 486 | 3 977 | 14 439 | ||||||
Interest on non-current financial debt, including current portion | 6 063 | 527 | 913 | 715 | 3 908 | ||||||
Lease liabilities, non-current and current portion | 1 896 | 275 | 378 | 261 | 982 | ||||||
Interest on lease liabilities, non-current and current portion | 1 453 | 49 | 78 | 65 | 1 261 | ||||||
Commitments for leases not yet commenced | 134 | 2 | 10 | 22 | 100 | ||||||
Unfunded pensions and other post-employment benefit plans | 1 614 | 110 | 214 | 207 | 1 083 | ||||||
Research and development potential milestone commitments | 6 743 | 602 | 1 560 | 742 | 3 839 | ||||||
Contingent consideration liabilities | 1 075 | 119 | 304 | 213 | 439 | ||||||
Property, plant and equipment purchase commitments | 204 | 159 | 41 | 1 | 3 | ||||||
Acquisition of business commitments on transaction entered into but not closed in 2021 1 | 1 500 | 800 | 300 | 400 | |||||||
Total contractual cash obligations | 46 205 | 5 264 | 8 284 | 6 203 | 26 454 | ||||||
1 Please refer to “Item 18. Financial Statements – Note 2 Significant transactions” for additional information. |
5.C Research and development, patents and licenses
5.D Trend information
5.E Critical accounting estimates
(USD millions) | 2021 | In % of gross sales to third parties | 2020 | In % of gross sales to third parties | |||||
Innovative Medicines gross sales subject to deductions | 60 336 | 100.0 | 56 067 | 100.0 | |||||
US-specific healthcare plans and program rebates | -5 125 | -8.5 | -5 412 | -9.7 | |||||
Non-US-specific healthcare plans and program rebates | -4 399 | -7.3 | -3 746 | -6.7 | |||||
Non-healthcare plans and program-related rebates, returns and other deductions | -8 817 | -14.6 | -7 896 | -14.0 | |||||
Total Innovative Medicines gross-to-net sales adjustments 1 | -18 341 | -30.4 | -17 054 | -30.4 | |||||
Innovative Medicines net sales | 41 995 | 69.6 | 39 013 | 69.6 | |||||
1 The gross-to-net sales adjustments are charged through revenue deduction provisions or charged directly to the income statement without being recorded in revenue deduction provisions. |
Item 6. Directors, Senior Management and Employees
6.A Directors and senior management
6.B Compensation
Compensation at a glance
CHF 000s | 2021 total compensation1,2 | ||
Chairman of the Board | 3 805 | ||
Other members of the Board | 4 764 | ||
Total | 8 569 | ||
1 Includes an amount of CHF 25 580 for mandatory employer contributions for all Board members paid by Novartis to governmental social security systems. This amount is out of total employer contributions of CHF 435 204 and provides a right to the maximum future insured government pension benefit for the Board member. | |||
2 No additonal compensation was paid for the Lead Independent Director role. |
CHF 000s | AGM 2022-2023 annual fee | ||
Chairman of the Board | 3 800 | ||
Board membership | 280 | ||
Vice Chairman | 50 | ||
Lead Independent Director | 20 | ||
Chair of the Audit and Compliance Committee | 130 | ||
Chair of the Compensation Committee | 90 | ||
Chair of the following committees: • Governance, Nomination and Corporate Responsibilities Committee • Science & Technology Committee • Risk Committee | 70 | ||
Membership of the Audit and Compliance Committee | 70 | ||
Membership of the following committees: • Compensation Committee • Governance, Nomination and Corporate Responsibilities Committee • Science & Technology Committee • Risk Committee | 40 | ||
Executive Committee compensation philosophy and principles
2021 Executive Committee compensation
2021 annual base salary | 2021 pension benefits1 | 2021 Annual Incentive | Long-Term Incentives LTPP 2019-2021 cycle | Other 2021 compensation | |||||||||||||
Currency | Cash (amount) | Amount | Cash | Equity2 | Equity (value at vesting date)3 | Amount4,5 | Total realized compensation (incl. share price movement)6 | ||||||||||
Executive Committee members | |||||||||||||||||
Vasant Narasimhan (CEO) | CHF | 1 769 200 | 176 731 | 1 328 625 | 1 328 642 | 6 356 128 | 265 401 | 11 224 727 | |||||||||
Aggregate realized compensation of the other 14 Executive Committee members, including the members who stepped down during the financial year 2021 7,8 | CHF | 8 983 841 | 2 065 561 | 4 174 006 | 5 400 015 | 18 770 029 | 6 021 712 | 45 415 164 | |||||||||
Total | CHF | 10 753 041 | 2 242 292 | 5 502 631 | 6 728 657 | 25 126 157 | 6 287 113 | 56 639 891 | |||||||||
See 2020 realized compensation for the CEO and other Executive Committee members for 2020 comparative figures. | |||||||||||||||||
1 Includes mandatory employer contributions of CHF 5 498 for the CEO and CHF 53 693 for the other Executive Committee members paid by Novartis to governmental social security systems. This amount is out of total employer contributions of CHF 4 966 397 paid in 2021 for all Executive Committee members, and provides a right to the maximum future insured government pension benefit. | |||||||||||||||||
2 The portion of the Annual Incentive delivered in equity is rounded up to the nearest share, based on the closing share price on the grant date (January 26, 2022) of CHF 78.16 per Novartis share and USD 84.24 per ADR. | |||||||||||||||||
3 The amounts represent the underlying share value of the 296 741 LTPP PSUs vesting on January 22, 2022, to the CEO and other Executive Committee members for the 2019-2021 performance cycle, inclusive of earned Alcon Keep Whole awards and dividend equivalents for the three-year cycle (for details, see ''—LTPP performance outcomes''). The taxable value is determined using the closing share price on the day the Novartis Board of Directors approved the final LTPP performance factor (i.e., January 26, 2022) of CHF 78.16 per Novartis share and USD 84.24 per ADR. Marie-France Tschudin and Robert Kowalski were promoted to the Executive Committee during the course of the 2019-2021 performance period, and as such, the information disclosed reflects their pro-rata LTPP 2019-2021 payout attributable to the period in which they were members of the Executive Committee. Richard Saynor and Karen Hale joined Novartis after the 2019 LTI awards were made and hence did not receive an LTPP award for the 2019-2021 performance period. | |||||||||||||||||
4 Includes any other perquisites, benefits in kind, and international assignment benefits as per the global mobility policy (e.g., housing, international health insurance, children's school fees, tax equalization). The 2021 tax payments were CHF 127 009 for Mr. Saynor, as well as CHF 822 808 for Susanne Schaffert, and CHF 156 788 for Vas Narasimhan. | |||||||||||||||||
5 Includes 6 128 vested RSUs and 3 546 PSUs (for a total value of CHF 782 649), which vested partially on March 13, 2021, and partially on July 28, 2021, to John Tsai in lieu of the LTI that he forfeited when leaving his previous employer. Also includes 2 584 vested RSUs and 2 043 vested PSUs (for a total value of CHF 379 414), which vested on February 14, 2021, to Mr. Saynor in lieu of the LTI that he forfeited when leaving his previous employer, and 4 313 vested PSUs (CHF 370 961) on January 18, 2021, to Klaus Moosmayer in lieu of the LTI he forfeited when leaving his previous employer. | |||||||||||||||||
6 All amounts are before deduction of the social security contribution and income tax due from the Executive Committee member. | |||||||||||||||||
7 Includes the first six weeks of Karen Hale's compensation, before her appointment to the Executive Committee, under other compensation. Comprises the compensation of Bertrand Bodson, former Chief Data Officer and Steven Baert, former Chief People & Organization Officer, including the vesting of their Long-Term Incentives for 2019-2021 performance cycle, as per the plan rules. The compensation and benefits elements related to the period after the step-down dates are reported under the other compensation column. Unvested shares for Shannon Klinger were forfeited upon her departure from the Company. See “—2021 Executive Committee member departures" for details. | |||||||||||||||||
8 Amounts for Executive Committee members paid in USD were converted at a rate of USD 1.00 = CHF 0.9139, which is the same average exchange rate used in the Group's 2021 consolidated financial statements (a similar rule applies to payments made in other currencies during the year). |
PSUs at grant | Shares delivered at vesting | ||||||||||||||||
PSUs (target number) | PSUs (target value at grant date) (CHF)2 | Payout factor for ECN LTPP (% of target) | Performance shares delivered at vesting (number) | Performance shares delivered at vesting (value at vesting date) (CHF)3 | Dividend equivalent shares delivered at vesting (number)4 | Dividend equivalent shares delivered at vesting (value at vesting date) (CHF) | Total shares delivered at vesting (value at vesting date) (CHF) | ||||||||||
Executive Committee members 1 | |||||||||||||||||
Vasant Narasimhan | 69 052 | 6 086 243 | 107% | 73 886 | 5 774 930 | 7 436 | 581 198 | 6 356 128 | |||||||||
Other 14 Executive Committee members, including the members who stepped down during the financial year 2021 5 | 202 990 | 17 625 412 | 107% | 218 916 | 17 071 653 | 21 880 | 1 733 318 | 18 770 029 | |||||||||
Total | 272 042 | 23 711 655 | 292 802 | 22 846 583 | 29 316 | 2 314 516 | 25 126 157 | ||||||||||
1 Marie-France Tschudin and Robert Kowalski joined the Executive Committee during the course of the 2019-2021 performance period. As such, the information disclosed reflects their pro-rata LTPP 2019-2021 attributable to the period in which they were members of the Executive Committee. Richard Saynor and Karen Hale joined Novartis after the 2019-2021 LTPP awards were made and hence did not receive an LTPP award for this performance period. | |||||||||||||||||
2 The shown amounts represent the underlying share value of the target number of PSUs granted to each Executive Committee member for the 2019-2021 performance period, based on the closing share price on the grant date (January 22, 2019) of CHF 88.14 per Novartis share and USD 88.32 per ADR (pre-Alcon spin-off share price). | |||||||||||||||||
3 The shown amounts, inclusive of earned Alcon Keep Whole awards, represent the underlying share value of the number of PSUs vested for the 2019-2021 performance period, based on the closing share price on the day the Novartis Board of Directors approved the final LTPP performance payout factor (i.e., January 26, 2022) of CHF 78.16 per Novartis share and USD 84.24 per ADR. | |||||||||||||||||
4 Dividend equivalent shares are calculated on the dividend each member of the Executive Committee would have received, based on the actual number of shares delivered at the end of the 2019-2021 performance period. At vesting, the dividend equivalents are credited in shares or ADRs. | |||||||||||||||||
5 Includes the LTPP vesting for Bertrand Bodson, former Chief Data Officer and Steven Baert, former Chief People Officer for 2019-2021 performance cycle, as per the plan rules. The LTPP vesting for Shannon Klinger were forfeited upon her departure from the Company on May 31, 2021. |
2020 annual base salary | 2020 pension benefits1 | 2020 Annual Incentive | Long-Term Incentives | Other 2020 compensation | |||||||||||||||
LTPP 2018-2020 cycle | LTRPP 2018-2020 cycle | ||||||||||||||||||
Currency | Cash (amount) | Amount | Cash | Equity2 | Equity (value at vesting date)3 | Equity (value at vesting date)3 | Amount2,4,5 | Total realized compensation (incl. share price movement)6 | |||||||||||
Executive Committee members | |||||||||||||||||||
Vasant Narasimhan (CEO) | CHF | 1 743 750 | 175 102 | 1 318 275 | 1 318 275 | 5 605 100 | 2 449 823 | 113 841 | 12 724 166 | ||||||||||
Aggregate realized compensation of the other 12 Executive Committee members 7 | CHF | 9 792 833 | 2 320 106 | 4 901 015 | 5 997 169 | 14 416 662 | 3 863 980 | 4 803 881 | 46 095 647 | ||||||||||
Total | CHF | 11 536 583 | 2 495 208 | 6 219 290 | 7 315 444 | 20 021 762 | 6 313 803 | 4 917 722 | 58 819 813 | ||||||||||
1 Includes mandatory employer contributions of CHF 8 336 for the CEO and CHF 59 591 for the other Executive Committee members paid by Novartis to governmental social security systems. This amount is out of total employer contributions of CHF 6 088 770 paid in 2020 for all Executive Committee members, and provides a right to the maximum future insured government pension benefit for the Executive Committee members. | |||||||||||||||||||
2 The portion of the Annual Incentive delivered in equity is rounded up to the nearest share, based on the closing share price on the grant date (January 20, 2021) of CHF 86.01 per Novartis share and USD 96.92 per ADR. | |||||||||||||||||||
3 The amounts represent the underlying share value of the 245'786 LTPP PSUs and 75'714 LTRPP PSUs vested on January 18, 2021, to the CEO and other Executive Committee members for the performance cycle 2018-2020, inclusive of earned Alcon Keep Whole awards and dividend equivalents for the three-year cycle. The taxable value is determined using the closing share price on the day the Novartis Board of Directors approved the final LTPP and LTRPP performance factors (i.e., January 20, 2021) of CHF 86.01 per Novartis share and USD 96.92 per ADR. Bertrand Bodson, Shannon Thyme Klinger, Steffen Lang, Susanne Schaffert and Marie-France Tschudin were promoted to the Executive Committee during the course of the performance period 2018-2020, and as such, the information disclosed reflects their pro-rata LTPP and LTRPP 2018-2020 payouts attributable to the period in which they were a member of the Executive Committee. Klaus Moosmayer, John Tsai and Richard Saynor joined Novartis after the 2018 LTI awards being made and hence did not receive LTPP and LTRPP awards for the 2018-2020 performance period. | |||||||||||||||||||
4 Includes any other perquisites, benefits in kind, international assignment benefits as per the global mobility policy (e.g., housing, international health insurance, children's school fees, tax equalization). The 2020 tax payments for Richard Saynor were CHF 1 181 889 and for Susanne Schaffert were CHF 431 180. | |||||||||||||||||||
5 Includes 6 128 vested RSUs (CHF 471 666), of which 698 vested on March,13 2020, and 5 430 on July 28, 2020, as well as 4 022 vested PSUs (CHF 281 379) on March 13, 2020, to John Tsai in lieu of the LTI that he forfeited when leaving his previous employer. Also includes 2 421 vested RSUs (USD 229 487) on January 4, 2020, to James Bradner in lieu of the LTI that he forfeited when leaving his previous employer and 6 011 vested PSUs (CHF 550 788) on January 17, 2020, to Klaus Moosmayer in lieu of the LTI he forfeited when leaving his previous employer. Lastly, includes 2 348 vested RSUs (CHF 224 516) and 2 178 vested PSUs (CHF 208 260) on February 15, 2020, to Richard Saynor in lieu of the LTI that he forfeited when leaving his previous employer. The PSUs had the same performance measures as the LTPP for the 2017-2019 performance cycle (NCVA and long-term innovation). | |||||||||||||||||||
6 All amounts are before deduction of the social security contribution and income tax due by the Executive Committee member. | |||||||||||||||||||
7 Amounts for Executive Committee members paid in USD were converted at a rate of USD 1.00 = CHF 0.939, which is the same average exchange rate used in the Group's 2020 consolidated financial statements (similar rule applies in case of payments made in other currencies during the year). |
Fixed compensation and pension benefits | Variable compensation | ||||||||||||||||
Actual compensation paid or granted for 2021 | Long-Term Incentive 2021-2023 cycle grants at target | ||||||||||||||||
2021 annual base salary | 2021 pension benefits | 2021 Annual Incentive (performance achieved) | LTPP 2021-2023 cycle | Other 2021 compensation | Total compensation paid, promised or granted 2021 | ||||||||||||
Currency | Cash (amount) | Amount1 | Cash (amount) | Equity (value at grant date)2 | PSUs (target value at grant date)3 | Amount4 | Amount5 | ||||||||||
Executive Committee members active on December 31, 2021 | |||||||||||||||||
Vasant Narasimhan | CHF | 1 769 200 | 176 731 | 1 328 625 | 1 328 642 | 5 757 423 | 265 401 | 10 626 023 | |||||||||
James Bradner 6 | USD | 1 184 462 | 367 246 | 712 802 | 712 839 | 2 970 016 | 92 286 | 6 039 652 | |||||||||
Karen Hale (from May 15, 2021) 7 | CHF | 519 750 | 85 987 | 261 062 | 261 133 | 1 442 371 | 542 689 | 3 112 992 | |||||||||
Harry Kirsch | CHF | 1 072 084 | 177 174 | 354 255 | 1 062 820 | 2 791 111 | 43 617 | 5 501 060 | |||||||||
Robert Kowalski (from September 1, 2021) 8 | CHF | 233 333 | 49 692 | 105 288 | 105 360 | 448 824 | 180 428 | 1 122 925 | |||||||||
Steffen Lang | CHF | 780 833 | 180 413 | 508 680 | 763 076 | 1 570 027 | 14 430 | 3 817 459 | |||||||||
Klaus Moosmayer | CHF | 566 667 | 198 992 | 253 000 | 253 004 | 1 035 044 | 49 850 | 2 356 557 | |||||||||
Richard Saynor | CHF | 785 000 | 190 263 | 196 500 | 196 572 | 1 493 478 | 416 693 | 3 278 506 | |||||||||
Susanne Schaffert | CHF | 881 333 | 180 837 | 88 250 | 794 262 | 2 118 082 | 856 650 | 4 919 415 | |||||||||
John Tsai | CHF | 875 834 | 186 807 | 306 950 | 307 012 | 2 192 567 | 201 307 | 4 070 477 | |||||||||
Marie-France Tschudin | CHF | 881 333 | 164 980 | 706 000 | 706 019 | 2 029 750 | - | 4 488 083 | |||||||||
Robert Weltevreden | CHF | 673 333 | 171 352 | 299 200 | 299 275 | 1 292 042 | - | 2 735 202 | |||||||||
Total | 10 121 211 | 2 098 866 | 5 059 259 | 6 728 657 | 24 885 096 | 2 655 408 | 51 548 498 | ||||||||||
Executive Committee members who stepped down during 2021 | |||||||||||||||||
Steven Baert (until June 30, 2021) 9 | CHF | 400 277 | 87 753 | 399 887 | - | 422 223 | 1 831 302 | 3 141 442 | |||||||||
Bertrand Bodson (until January 31, 2021) 10 | CHF | 54 451 | 15 240 | 43 485 | - | - | 1 339 471 | 1 452 647 | |||||||||
Shannon Thyme Klinger (until March 15, 2021) 11 | CHF | 177 102 | 40 434 | - | - | 279 791 | 2 018 161 | 2 515 487 | |||||||||
Subtotal | 631 830 | 143 427 | 443 372 | 0 | 702 014 | 5 188 934 | 7 109 576 | ||||||||||
Total | 10 753 041 | 2 242 292 | 5 502 631 | 6 728 657 | 25 587 110 | 7 844 343 | 58 658 074 | ||||||||||
Based on assumption of 100% payout at target. Actual payout (0-200% of target) will be known at the end of the three-year cycle in January 2024 | |||||||||||||||||
See next page for 2020 comparative figures. | |||||||||||||||||
1 Includes mandatory employer contributions of CHF 5 498 for the CEO and CHF 53 693 for the other Executive Committee members paid by Novartis to governmental social security systems. This amount is out of total employer contributions of CHF 4 966 397 paid in 2021 for all Executive Committee members, and provides a right to the maximum future insured government pension benefit. | |||||||||||||||||
2 The portion of the Annual Incentive delivered in equity is rounded up to the nearest share, based on the closing share price on the grant date (January 26, 2022) of CHF 78.16 per Novartis share and USD 84.24 per ADR. | |||||||||||||||||
3 The amounts represent the underlying share value of the target number of PSUs granted to Executive Committee members for the 2021-2023 performance cycle, based on the closing share price on the grant date (January 20, 2021) of CHF 86.01 per Novartis share and USD 96.92 per ADR for all members. | |||||||||||||||||
4 Includes any other perquisites, benefits in kind, and international assignment benefits as per the global mobility policy (e.g., housing, international health insurance, children's school fees, tax equalization). The compensation and benefits elements related to the period after the step-down dates are also reported under ‘other 2021 compensation’. | |||||||||||||||||
5 All amounts are before deduction of the social security contribution and income tax due by the Executive Committee member. | |||||||||||||||||
6 Amounts in USD for James Bradner were converted at a rate of CHF 1.00 = USD 1.0942, which is the average rate used in the Group’s 2021 consolidated financial statements. | |||||||||||||||||
7 Karen Hale received a pro-rata LTPP award of 18 639 PSUs on Apr-2, 2021 (at CHF 81.15 share price at grant) upon joining the organization, as per contractual entitlement. The other compensation amount includes the first six weeks of compensation before her appointment to the Executive Committee. | |||||||||||||||||
8 Robert Kowalski received his 2021 LTPP grant before his appointment to Executive Committee, therefore the reported LTPP amount is pro-rated to reflect his time as Executive Committee member over the full performance cycle. | |||||||||||||||||
9 Steven Baert left the Executive Committee on June 30, 2021 and ended his notice period on September 30, 2021, in line with his reduced contractual notice period (for more details, see “—2021 Executive Committee member departures”). He received his 2021 Annual Incentive 100% in cash on a pro-rata basis, and the LTPP grant for the 2021-2023 performance cycle, included in the table above, will vest at the end of the performance cycle on a pro-rata basis subject to the plan rules. | |||||||||||||||||
10 Bertrand Bodson left the Executive Committee on January 31, 2021 and ended his notice period on November 30, 2021, in line with his reduced contractual notice period (for more details, see “—2021 Executive Committee member departures”). He received his 2021 Annual Incentive 100% in cash on a pro-rata basis, and no LTPP was granted for the 2021-2023 performance cycle. | |||||||||||||||||
11 Shannon Klinger resigned as Chief Legal Officer as of March 15, 2021, and left the Company on May 31, 2021, in line with her reduced contractual notice period (for more details, see “—2021 Executive Committee member departures”). The 2021 Annual Incentive and LTPP 2021-2023 cycle grant (23 586 PSUs), displayed at pro-rata value for the time she was in her role in 2021, were forfeited in full upon her departure. |
Executive Committee member compensation at grant for financial year 2020 | ||||||||||||||||||||||||||||||||||
Fixed compensation and pension benefits | Variable compensation | |||||||||||||||||||||||||||||||||
Actual compensation paid or granted for 2020 | Long-Term Incentive 2020-2022 cycle grants at target | |||||||||||||||||||||||||||||||||
2020 annual base salary | 2020 pension benefits | 2020 Annual Incentive (performance achieved) | LTPP 2020-2022 cycle | Other 2020 compensation | Total compensation paid, promised or granted 2020 | |||||||||||||||||||||||||||||
Currency | Cash (amount) | Amount1 | Cash (amount) | Equity (value at grant date)2 | PSUs (target value at grant date)3 | Amount4 | Amount5 | |||||||||||||||||||||||||||
Executive Committee members active on December 31, 2020 | ||||||||||||||||||||||||||||||||||
Vasant Narasimhan | CHF | 1 743 750 | 175 102 | 1 318 275 | 1 318 275 | 5 712 549 | 113 841 | 10 381 793 | ||||||||||||||||||||||||||
Steven Baert | CHF | 798 617 | 167 294 | 480 000 | 480 022 | 1 679 265 | 85 587 | 3 690 785 | ||||||||||||||||||||||||||
Bertrand Bodson | CHF | 634 834 | 177 088 | 256 000 | 256 052 | 1 152 115 | 131 745 | 2 607 834 | ||||||||||||||||||||||||||
James Bradner 6 | USD | 1 203 654 | 373 063 | 768 900 | 768 963 | 2 911 862 | 88 472 | 6 114 914 | ||||||||||||||||||||||||||
Harry Kirsch | CHF | 1 063 433 | 171 930 | 585 750 | 585 814 | 2 769 330 | 50 294 | 5 226 551 | ||||||||||||||||||||||||||
Shannon Thyme Klinger | CHF | 862 500 | 182 852 | 525 000 | 525 005 | 1 925 517 | 32 773 | 4 053 647 | ||||||||||||||||||||||||||
Steffen Lang | CHF | 758 333 | 171 130 | 228 000 | 684 038 | 1 367 619 | 12 918 | 3 222 037 | ||||||||||||||||||||||||||
Klaus Moosmayer | CHF | 520 833 | 184 884 | 241 500 | 241 516 | 840 004 | 29 496 | 2 058 233 | ||||||||||||||||||||||||||
Richard Saynor | CHF | 778 333 | 190 372 | 390 000 | 390 055 | 1 482 060 | 1 737 100 | 4 967 920 | ||||||||||||||||||||||||||
Susanne Schaffert | CHF | 871 250 | 173 111 | 341 445 | 796 797 | 2 013 669 | 581 188 | 4 777 460 | ||||||||||||||||||||||||||
John Tsai | CHF | 868 333 | 182 517 | 478 500 | 478 560 | 2 175 855 | 104 669 | 4 288 434 | ||||||||||||||||||||||||||
Marie-France Tschudin | CHF | 871 250 | 182 216 | 437 750 | 437 791 | 2 013 669 | - | 3 942 677 | ||||||||||||||||||||||||||
Robert Weltevreden | CHF | 634 834 | 186 392 | 215 040 | 399 430 | 1 152 115 | 2 925 | 2 590 735 | ||||||||||||||||||||||||||
Total | 11 536 583 | 2 495 208 | 6 219 290 | 7 315 444 | 27 018 132 | 2 965 615 | 57 550 273 | |||||||||||||||||||||||||||
Based on assumption of 100% payout at target. Actual payout (0-200% of target) will be known at the end of the three-year cycle in January 2023. | ||||||||||||||||||||||||||||||||||
1 Includes mandatory employer contributions of CHF 8 336 for the CEO and CHF 59 591 for the other Executive Committee members paid by Novartis to governmental social security systems. This amount is out of total employer contributions of CHF 6 088 770 paid in 2020 for all Executive Committee members, and provides a right to the maximum future insured government pension benefit for the Executive Committee members. | ||||||||||||||||||||||||||||||||||
2 The portion of the Annual Incentive delivered in equity is rounded up to the nearest share, based on the closing share price on the grant date (January 20, 2021) of CHF 86.01 per Novartis share and USD 96.92 per ADR. | ||||||||||||||||||||||||||||||||||
3 The amounts represent the underlying share value of the target number of PSUs granted to Executive Committee members for the performance cycle 2020-2022, based on the closing share price on the grant date (January 21, 2020) of CHF 92.89 per Novartis share and USD 95.19 per ADR for all members. | ||||||||||||||||||||||||||||||||||
4 Includes any other perquisites, benefits in kind, and international assignment benefits as per the global mobility policy (e.g., housing, international health insurance, children's school fees, tax equalization). | ||||||||||||||||||||||||||||||||||
5 All amounts are before deduction of the social security contribution and income tax due by the Executive Committee member. | ||||||||||||||||||||||||||||||||||
6 Amounts in USD for James Bradner were converted at a rate of CHF 1.00 = USD 1.0649, which is the average rate used in the Group’s 2020 consolidated financial statements. |
Variable compensation1 | |||||||
2021 Annual Incentive (performance achieved) | LTPP 2021-2023 cycle | Other | |||||
Equity (number)2 | PSUs (target number)3 | Equity/PSUs (number) | |||||
Executive Committee members active on December 31, 2021 | |||||||
Vasant Narasimhan | 16 999 | 66 939 | 0 | ||||
James Bradner | 8 462 | 30 644 | 0 | ||||
Karen Hale (from May 15, 2021) | 3 341 | 17 823 | 0 | ||||
Harry Kirsch | 13 598 | 32 451 | 0 | ||||
Robert Kowalski (from September 1, 2021) | 1 348 | 5 067 | 0 | ||||
Steffen Lang | 9 763 | 18 254 | 0 | ||||
Klaus Moosmayer | 3 237 | 12 034 | 0 | ||||
Richard Saynor | 2 515 | 17 364 | 0 | ||||
Susanne Schaffert | 10 162 | 24 626 | 0 | ||||
John Tsai | 3 928 | 25 492 | 0 | ||||
Marie-France Tschudin | 9 033 | 23 599 | 0 | ||||
Robert Weltevreden | 3 829 | 15 022 | 0 | ||||
Total | 86 215 | 289 315 | 0 | ||||
Executive Committee members who stepped down during 2021 | |||||||
Steven Baert (until June 30, 2021) 4 | 0 | 4 909 | 0 | ||||
Bertrand Bodson (until January 31, 2021) 5 | 0 | 0 | 0 | ||||
Shannon Thyme Klinger (until March 15, 2021) 6 | 0 | 3 253 | 0 | ||||
Subtotal | 0 | 8 162 | 0 | ||||
Total | - | 8 162 | 0 | ||||
See next page for 2020 comparative figures. | |||||||
1 The values of the awards are reported in the table "2021 compensation at grant value for the CEO and other Executive Committee members." | |||||||
2 Vested shares, restricted shares and/or RSUs granted under the Annual Incentive for the 2021 performance period. | |||||||
3 Target number of PSUs granted under the LTPP as applicable for the 2021-2023 performance cycle. | |||||||
4 Steven Baert left the Executive Committee on June 30, 2021 and ended his notice period on September 30, 2021, in line with his reduced contractual notice period (for more details, see “—2021 Executive Committee member departures”). The LTPP grant for the 2021-2023 performance cycle, included in the table above, will vest at the end of the performance cycle on a pro-rata basis subject to the plan rules. | |||||||
5 Bertrand Bodson left the Executive Committee on January 31, 2021 and ended his notice period on November 30, 2021, in line with his reduced contractual notice period (for more details, see “—2021 Executive Committee member departures”). No LTPP was granted for the 2021-2023 performance cycle. | |||||||
6 Shannon Klinger resigned as Chief Legal Officer as of March 15, 2021, and left the Company on May 31, 2021, in line with her reduced contractual notice period (for more details, see “—2021 Executive Committee member departures”). The LTPP 2021-2023 cycle grant (23 586 PSUs), displayed at pro-rata value for the time she was in her role in 2021, was forfeited in full upon her departure. |
Variable compensation1 | |||||||
2020 Annual Incentive (performance achieved) | LTPP 2020-2022 cycle | Other | |||||
Equity (number)2 | PSUs (target number)3 | Equity/PSUs (number) | |||||
Executive Committee members active on December 31, 2020 | |||||||
Vasant Narasimhan | 15 327 | 61 498 | 0 | ||||
Steven Baert | 5 581 | 18 078 | 0 | ||||
Bertrand Bodson | 2 977 | 12 403 | 0 | ||||
James Bradner | 7 934 | 30 590 | 0 | ||||
Harry Kirsch | 6 811 | 29 813 | 0 | ||||
Shannon Thyme Klinger | 6 104 | 20 729 | 0 | ||||
Steffen Lang | 7 953 | 14 723 | 0 | ||||
Klaus Moosmayer | 2 808 | 9 043 | 0 | ||||
Richard Saynor | 4 535 | 15 955 | 0 | ||||
Susanne Schaffert | 9 264 | 21 678 | 0 | ||||
John Tsai | 5 564 | 23 424 | 0 | ||||
Marie-France Tschudin | 5 090 | 21 678 | 0 | ||||
Robert Weltevreden | 4 644 | 12 403 | 0 | ||||
Total | 84 592 | 292 015 | 0 | ||||
1 The values of the awards are reported in the table "2020 compensation at grant value for the CEO and other Executive Committee members." | |||||||
2 Vested shares, restricted shares and/or RSUs granted under the Annual Incentive for the 2020 performance period. | |||||||
3 Target number of PSUs granted under the LTPP as applicable for the 2020-2022 performance cycle. |
Function | Ownership level | ||
CEO | 5 x base compensation | ||
Other Executive Committee members | 3 x base compensation | ||
Vested shares and ADRs1 | Unvested shares and other equity rights2 | Equity ownership level as a multiple of annual base salary3 | Unvested target PSUs (e.g., LTPP)4 | Total at December 31, 2021 | |||||||
Vasant Narasimhan | 170111 | 74 194 | 11x | 144 632 | 388 937 | ||||||
James Bradner | 43 744 | 38 099 | 6x | 72 709 | 154 552 | ||||||
Karen Hale (from May 15, 2021) | 0 | 3 977 | 0x | 5 082 | 9 059 | ||||||
Harry Kirsch | 285 186 | 41 395 | 24x | 71 715 | 398 296 | ||||||
Robert Kowalski (from September 1, 2021) | 0 | 21 186 | 2x | 16 376 | 37 562 | ||||||
Steffen Lang | 125 286 | 32 082 | 16x | 33 836 | 191 204 | ||||||
Klaus Moosmayer | 8 312 | 9 061 | 2x | 25 671 | 43 044 | ||||||
Richard Saynor | 0 | 13 913 | 1x | 19 800 | 33 713 | ||||||
Susanne Schaffert | 116 173 | 37 190 | 13x | 50 611 | 203 974 | ||||||
John Tsai | 23 382 | 26 781 | 4x | 60 680 | 110 843 | ||||||
Marie-France Tschudin | 39 353 | 31 007 | 6x | 53 856 | 124 216 | ||||||
Robert Weltevreden | 27 758 | 16 224 | 5x | 27 840 | 71 822 | ||||||
Total | 839 305 | 345 109 | 582 808 | 1 767 222 | |||||||
1 Includes holdings of "persons closely linked" to Executive Committee members (see the ‘persons closely linked’ definition). | |||||||||||
2 Includes unvested shares and ADRs as well as other equity rights applicable for the determination of equity amounts for the share ownership requirements, as per the definition above. Also includes unvested Alcon Keep Whole shares received in connection to the Alcon spin-off. | |||||||||||
3 The multiple is calculated based on the full-year annual base salary and the closing share price as at the end of the 2021 financial year. The share price on the final trading day of 2021 was CHF 80.28 / USD 87.47 as at December 31, 2021. | |||||||||||
4 The target number of PSUs is disclosed pro-rata to December 31, 2021, unless the award qualified for full vesting under the relevant plan rules. |
Annual base salary1 | Variable compensation2 | ||||
Vasant Narasimhan | 16.9% | 83.1% | |||
James Bradner | 20.9% | 79.1% | |||
Karen Hale (from May 15, 2021) | 17.2% | 82.8% | |||
Harry Kirsch | 20.1% | 79.9% | |||
Robert Kowalski (from September 1, 2021) | 21.7% | 78.3% | |||
Steffen Lang | 21.5% | 78.5% | |||
Klaus Moosmayer | 26.3% | 73.7% | |||
Richard Saynor | 25.4% | 74.6% | |||
Susanne Schaffert | 18.6% | 81.4% | |||
John Tsai | 22.6% | 77.4% | |||
Marie-France Tschudin | 20.4% | 79.6% | |||
Robert Weltevreden | 26.3% | 73.7% | |||
Total 3 | 20.5% | 79.5% | |||
1 Excludes pension and other benefits and is pro-rated for ECN time. | |||||
2 See the table “2021 compensation at grant value for the CEO and other Executive Committee members” with regard to the disclosure principles of variable compensation. | |||||
3 Excludes members, who stepped down during the year. |
Performance measures | Tracking | ||
Net sales CAGR (25%) | |||
Core operating income CAGR (25%) | |||
Innovation (25%) | |||
Relative TSR (25%) | |||
CAGR = compound annual growth rate |
Performance measures | Tracking | ||
Net sales CAGR (25%) | |||
Core operating income CAGR (25%) | |||
Innovation (25%) | |||
Relative TSR (25%) | |||
CAGR = compound annual growth rate |
2022 Executive Committee compensation
2021 Board compensation
CHF 000s | 2021-2022 AGM annual fee | ||
Chairman of the Board | 3 800 | ||
Board membership | 280 | ||
Vice Chairman | 50 | ||
Chair of the Audit and Compliance Committee | 130 | ||
Chair of the Compensation Committee | 90 | ||
Chair of the following committees: • Governance, Nomination and Corporate Responsibilities Committee • Science & Technology Committee • Risk Committee | 70 | ||
Membership of the Audit and Compliance Committee | 70 | ||
Membership of the following committees: • Compensation Committee • Governance, Nomination and Corporate Responsibilities Committee • Science & Technology Committee • Risk Committee | 40 | ||
Board membership | Audit and Compliance Committee | Compensation Committee | Governance, Nomination and Corporate Responsibilities Committee | Science & Technology Committee | Risk Committee | Shares (number)1 | Cash (CHF) (A) | Shares (CHF) (B) | Other (CHF) (C)2 | Total (CHF) (A)+(B)+(C)3 | |||||||||||||
Board members active on December 31, 2021 | |||||||||||||||||||||||
Joerg Reinhardt 4 | Chairman | Chair | 22 830 | 1 900 000 | 1 900 000 | 4 560 | 3 804 560 | ||||||||||||||||
Enrico Vanni | Vice Chairman / Lead Independent Director7 | • | • | • | 3 035 | 244 167 | 244 167 | 3 670 | 492 004 | ||||||||||||||
Nancy C. Andrews | • | • | • | 2 162 | 180 000 | 180 000 | - | 360 000 | |||||||||||||||
Ton Buechner | • | • | Chair 6 | 3 625 | 175 000 | 240 000 | 4 560 | 419 560 | |||||||||||||||
Patrice Bula | • | • | 1 922 | 160 000 | 160 000 | 4 560 | 324 560 | ||||||||||||||||
Elizabeth Doherty | • | Chair | • | 3 391 | 206 250 | 243 750 | - | 450 000 | |||||||||||||||
Ann Fudge | • | • | • | 2 162 | 180 000 | 180 000 | - | 360 000 | |||||||||||||||
Bridgette Heller | • | • 6 | • | 2 128 | 189 167 | 189 167 | - | 378 334 | |||||||||||||||
Frans van Houten | • | • 6 | • | 4 257 | - | 378 333 | - | 378 333 | |||||||||||||||
Simon Moroney | • | Chair 6 | • | 2 187 | 197 500 | 197 500 | 4 560 | 399 560 | |||||||||||||||
Andreas von Planta | • | Chair | • | 2 556 | 200 833 | 200 833 | 3 670 | 405 336 | |||||||||||||||
Charles L. Sawyers | • | • | • | 2 162 | 180 000 | 180 000 | - | 360 000 | |||||||||||||||
William T. Winters | • | • | • | 4 325 | - | 360 000 | - | 360 000 | |||||||||||||||
Subtotal | 56 742 | 3 812 917 | 4 653 750 | 25 580 | 8 492 247 | ||||||||||||||||||
Board members who stepped down at the 2021 AGM | |||||||||||||||||||||||
Srikant Datar 5 | 1 970 | 23 000 | 53 667 | - | 76 667 | ||||||||||||||||||
Subtotal | - | - | - | - | - | ||||||||||||||||||
Total | 58 712 | 3 835 917 | 4 707 417 | 25 580 | 8 568 914 | ||||||||||||||||||
See next page for 2020 comparative figures. | |||||||||||||||||||||||
1 The shown amounts represent the gross number of shares delivered to each Board member in 2021 for the respective Board member’s service period. The number of shares reported in this column represent: (i) the second and final equity installment delivered in February 2021 for the services from the 2020 AGM to the 2021 AGM, and (ii) the first of two equity installments delivered in August 2021 for the services from the 2021 AGM to the 2022 AGM. The second and final equity installment for the services from the 2021 AGM to the 2022 AGM will take place in February 2022. | |||||||||||||||||||||||
2 Includes an amount of CHF 25 580 for mandatory employer contributions for all Board members paid by Novartis to governmental social security systems. This amount is out of total employer contributions of CHF 435 204 and provides a right to the maximum future insured government pension benefit for the Board member. | |||||||||||||||||||||||
3 All amounts are before deduction of the social security contribution and income tax due by the Board member. | |||||||||||||||||||||||
4 No additional committee fees for chairing the Science & Technology Committee were delivered to Joerg Reinhardt. | |||||||||||||||||||||||
5 Until March 2, 2021. | |||||||||||||||||||||||
6 From March 2, 2021. | |||||||||||||||||||||||
7 No additonal compensation was paid for the Lead Independent Director role. |
Board membership | Audit and Compliance Committee | Compensation Committee | Governance, Nomination and Corporate Responsibilities Committee | Science & Technology Committee | Risk Committee | Shares (number)1 | Cash (CHF) (A) | Shares (CHF) (B) | Other (CHF) (C)2 | Total (CHF) (A)+(B)+(C)3 | |||||||||||||
Board members active on December 31, 2020 | |||||||||||||||||||||||
Joerg Reinhardt 4 | Chairman | Chair | 22 629 | 1 900 000 | 1 900 000 | 4 501 | 3 804 501 | ||||||||||||||||
Enrico Vanni | Vice Chairman | • | Chair | • | 3 156 | 265 000 | 265 000 | 3 614 | 533 614 | ||||||||||||||
Nancy C. Andrews | • | • | • | 2 143 | 180 000 | 180 000 | - | 360 000 | |||||||||||||||
Ton Buechner | • | • | • | 3 508 | 29 167 | 354 167 | 4 501 | 387 835 | |||||||||||||||
Patrice Bula | • | • | 2 750 | 133 333 | 186 666 | 4 501 | 324 500 | ||||||||||||||||
Srikant Datar | • | • | • | Chair | 3 348 | 153 333 | 306 666 | - | 459 999 | ||||||||||||||
Elizabeth Doherty | • | Chair | • | 3 424 | 131 250 | 318 750 | - | 450 000 | |||||||||||||||
Ann Fudge | • | • | • | 2 249 | 183 333 | 183 333 | - | 366 666 | |||||||||||||||
Bridgette Heller 5 | • | • | 1 059 | 133 333 | 133 333 | - | 266 666 | ||||||||||||||||
Frans van Houten | • | • | 3 810 | - | 320 000 | - | 320 000 | ||||||||||||||||
Simon Moroney 5 | • | • | 1 059 | 133 333 | 133 333 | 4 501 | 271 167 | ||||||||||||||||
Andreas von Planta | • | • | Chair | • | 2 739 | 230 000 | 230 000 | 4 501 | 464 501 | ||||||||||||||
Charles L. Sawyers | • | • | • | 2 143 | 180 000 | 180 000 | - | 360 000 | |||||||||||||||
William T. Winters | • | • | • 5 | 4 287 | - | 360 000 | - | 360 000 | |||||||||||||||
Total | 58 304 | 3 652 082 | 5 051 248 | 26 118 | 8 729 448 | ||||||||||||||||||
1 The shown amounts represent the gross number of shares delivered to each Board member in 2020 for the respective Board member’s service period. The number of shares reported in this column represent: (i) the second and final equity installment delivered in February 2020 for the services from the 2019 AGM to the 2020 AGM, and (ii) the first of two equity installments delivered in August 2020 for the services from the 2020 AGM to the 2021 AGM. The second and final equity installment for the services from the 2020 AGM to the 2021 AGM took place in February 2021. | |||||||||||||||||||||||
2 Includes an amount of CHF 26 118 for mandatory employer contributions for all Board members paid by Novartis to governmental social security systems. This amount is out of total employer contributions of CHF 430 023 , and provides a right to the maximum future insured government pension benefit for the Board member. | |||||||||||||||||||||||
3 All amounts are before deduction of the social security contribution and income tax due by the Board member. | |||||||||||||||||||||||
4 No additional committee fees for chairing the Science & Technology Committee were delivered to Joerg Reinhardt. | |||||||||||||||||||||||
5 From February 28, 2020. |
Number of shares at December 31, 20211,2 | |||
Joerg Reinhardt | 418 706 | ||
Enrico Vanni | 30 965 | ||
Nancy C. Andrews | 7 257 | ||
Ton Buechner | 17 856 | ||
Patrice Bula | 6 543 | ||
Elizabeth Doherty | 10 743 | ||
Ann Fudge | 13 222 | ||
Bridgette Heller | 2 655 | ||
Frans van Houten | 10 813 | ||
Simon Moroney | 2 240 | ||
Andreas von Planta | 166 390 | ||
Charles L. Sawyers | 14 214 | ||
William T. Winters | 24 436 | ||
Total | 726 040 | ||
1 Includes holdings of "persons closely linked" to Board members (see definition “Persons closely linked"). | |||
2 Each share provides entitlement to one vote. | |||
Compensation governance
Decision on | Decision-making authority | ||
Compensation of Chairman and other Board members | Board of Directors | ||
Compensation of CEO | Board of Directors | ||
Compensation of other Executive Committee members | Compensation Committee | ||
6.C Board practices
% holding of share capital Dec 31, 2021 | |||
Shareholders registered for their own account: | |||
Emasan AG, Basel | 3.7 | ||
UBS Fund Management (Switzerland) AG, Basel | 2.3 | ||
Credit Suisse Funds AG, Zurich | 2.1 | ||
% holding of share capital Dec 31, 2021 | |||
Shareholders registered as nominees: | |||
Chase Nominees Ltd., London | 8.8 | ||
The Bank of New York Mellon, New York | 3.0 | ||
Through The Bank of New York Mellon, Everett | 1.6 | ||
Through The Bank of New York Mellon, New York | 1.1 | ||
Through The Bank of New York Mellon, SA/NV, Brussels | 0.3 | ||
Nortrust Nominees Ltd., London | 4.2 | ||
Shareholder acting as American Depositary Share (ADS) depositary: | |||
JPMorgan Chase Bank, N.A., New York | 11.1 | ||
As of December 31, 20211 | Number of registered shareholders | % of share capital | |||
1–100 | 33 572 | 0.08 | |||
101–1 000 | 110 453 | 1.84 | |||
1 001–10 000 | 38 146 | 4.34 | |||
10 001–100 000 | 3 293 | 3.44 | |||
100 001–1 000 000 | 481 | 5.95 | |||
1 000 001–5 000 000 | 66 | 5.38 | |||
5 000 001 or more 2 | 29 | 45.25 | |||
Total registered shareholders/shares | 186 040 | 66.28 | |||
Unregistered shares | 33.72 | ||||
Total | 100.00 | ||||
1 At the record date of the 2021 Annual General Meeting of Shareholders (AGM), unregistered shares amounted to 16.8%. | |||||
2 Including significant registered shareholders as listed above |
As of December 31, 2021 | Shareholders in % | Shares in % | |||
Individual shareholders | 96.72 | 15.06 | |||
Legal entities 1 | 3.24 | 35.71 | |||
Nominees, fiduciaries and ADS depositary | 0.04 | 49.23 | |||
Total | 100.00 | 100.00 | |||
1 Excluding 4% of the share capital held as treasury shares by Novartis AG or its fully owned subsidiaries |
As of December 31, 2021 | Shareholders in % | Shares in % | |||
Belgium | 0.12 | 0.69 | |||
France | 1.97 | 0.34 | |||
Germany | 5.60 | 1.72 | |||
Japan | 0.18 | 0.45 | |||
Luxembourg | 0.06 | 0.73 | |||
Switzerland 2 | 87.31 | 46.17 | |||
United Kingdom | 0.60 | 24.26 | |||
United States | 0.25 | 23.56 | |||
Other countries | 3.91 | 2.08 | |||
Total | 100.00 | 100.00 | |||
1 Registered shares held by nominees are shown in the country where the company/affiliate entered in the Share Register as shareholder has its registered seat. | |||||
2 Excluding 4% of the share capital held as treasury shares by Novartis AG or its fully owned subsidiaries |
AGM | Shareholder decision | Shares canceled | Average repurchase share price (CHF)1 | ||||
2019 | • Capital reduction by CHF 11.63 million (from CHF 1 275 312 410 to CHF 1 263 687 410) • Authorization of the Board to repurchase shares up to a maximum of CHF 10 billion until the 2022 AGM under an eighth share repurchase program | 23 250 000 | 79.08 | ||||
2020 | • Capital reduction by CHF 30.16 million (from CHF 1 263 687 410 to CHF 1 233 530 460) | 60 313 900 | 88.18 | ||||
2021 | • Capital reduction by CHF 16.3 million (from CHF 1 233 530 460 to CHF 1 217 210 460) • Authorization of the Board to repurchase shares up to a maximum of CHF 10 billion between the 2021 AGM and the 2024 AGM | 32'640'000 | 80.57 | ||||
AGM | Proposal to the shareholders | Shares to be canceled | Average repurchase share price (CHF)1 | ||||
2022 | • Capital reduction by CHF 15.3 million (from CHF 1 217 210 460 to CHF 1 201 860 626) • Authorization of the Board to repurchase shares up to a maximum of CHF 10 billion between the 2022 AGM and the 2025 AGM2 | 30 699 668 | 81.82 | ||||
1 All shares were repurchased on the SIX Swiss Exchange second trading line. | |||||||
2 In addition to the remaining authorization from the 2021 AGM |
2021 | 2020 | 2019 | |||||
Issued shares | 2 434 420 920 | 2 467 060 920 | 2 527 374 820 | ||||
Treasury shares 1 | 199 480 972 | 210 238 872 | 262 366 332 | ||||
Outstanding shares at December 31 | 2 234 939 948 | 2 256 822 048 | 2 265 008 488 | ||||
Weighted average number of shares outstanding | 2 242 601 173 | 2 277 041 940 | 2 290 792 782 | ||||
1 Approximately 102 million treasury shares (2020: 103 million; 2019: 118 million) are held in Novartis entities that restrict their availability for use. |
2021 | 2020 | 2019 | |||||
Basic earnings per share from continuing operations (USD) | 10.71 | 3.55 | 3.12 | ||||
Basic earnings per share from discontinued operations (USD) | 2.00 | ||||||
Total basic earnings per share (USD) | 10.71 | 3.55 | 5.12 | ||||
Diluted earnings per share from continuing operations (USD) | 10.63 | 3.52 | 3.08 | ||||
Diluted earnings per share from discontinued operations (USD) | 1.98 | ||||||
Total diluted earnings per share (USD) | 10.63 | 3.52 | 5.06 | ||||
Net cash flows from operating activities from continuing operations (USD) | 6.72 | 5.99 | 5.91 | ||||
Year-end equity for Novartis AG shareholders (USD) | 30.31 | 25.07 | 24.49 | ||||
Dividend (CHF) 2 | 3.10 | 3.00 | 2.95 | ||||
Dividend (USD) 3 | 3.39 | 3.20 | 3.12 | ||||
1 Calculated on the weighted average number of shares outstanding, except year-end equity | |||||||
2 2021: proposal to shareholders for approval at the AGM on March 4, 2022. | |||||||
3 Translated into US dollars at the December 31, 2021, rate of USD 1.093 to the Swiss franc. This translation is an example only, and should not be construed as a representation that the Swiss franc amount represents, or has been or could be converted into US dollars at that or any other rate. 2020 and 2019, dividends are translated into US dollars at the Bloomberg Market System Rate on the payment date. |
2021 | 2020 | 2019 | |||||
Price/earnings ratio 1 | 8.2 | 26.7 | 18.5 | ||||
Price/earnings ratio from continuing operations 1 | 8.2 | 26.7 | 30.4 | ||||
Dividend yield (%) 1 | 3.9 | 3.6 | 3.2 | ||||
1 Based on the Novartis share price at December 31 of each year |
20211 | 20201 | 20191 | |||||
Year-end ADR price (USD) | 87.47 | 94.43 | 94.69 | ||||
High 2 | 98.47 | 99.01 | 96.14 | ||||
Low 2 | 79.70 | 70.67 | 75.40 | ||||
Number of ADRs outstanding 3 | 269 891 321 | 288 755 853 | 315 073 094 | ||||
1 2021, 2020 and 2019 exclude the business of Alcon, which was spun off in April 2019 into a separately traded standalone company. | |||||||
2 Based on the daily closing prices | |||||||
3 The depositary, JPMorgan Chase Bank, N.A., holds one Novartis AG share for every ADR issued. |
20211 | 20201 | 20191 | |||||
Year-end share price | 80.28 | 83.65 | 91.90 | ||||
High 2 | 86.75 | 95.82 | 96.04 | ||||
Low 2 | 73.44 | 69.96 | 77.03 | ||||
Year-end market capitalization (USD billions) 3 | 196.1 | 214.3 | 214.8 | ||||
Year-end market capitalization (CHF billions) 3 | 179.4 | 188.8 | 208.2 | ||||
1 2021, 2020 and 2019 exclude the business of Alcon, which was spun off in April 2019 into a separately traded standalone company. | |||||||
2 Based on the daily closing prices | |||||||
3 Market capitalization is calculated based on the number of shares outstanding (excluding treasury shares). Market capitalization in USD is based on the market capitalization in CHF converted at the year-end CHF/USD exchange rate. |
Shareholder participation
Members of the Board of Directors
Audit Committee Financial Expert
Maximum number of mandates | |||
Mandates | 10 | ||
Other listed companies 1 | 4 | ||
1 Holding a chair position of the board of directors in other listed companies counts as two mandates. |
Maximum number of mandates | |||
Mandates in companies that are controlled by Novartis AG | No limit | ||
Mandates held at the request of Novartis AG or companies controlled by it | 5 | ||
Mandates in associations, charitable organizations, foundations, trusts and employee welfare foundations | 10 | ||
Executive Committee
Maximum number of mandates | |||
Mandates | 6 | ||
Other listed companies 1 | 2 | ||
1 Holding a chair position of the board of directors in other listed companies is not allowed. |
Maximum number of mandates | |||
Mandates in companies that are controlled by Novartis AG | No limit | ||
Mandates held at the request of Novartis AG or companies controlled by it | 5 | ||
Mandates in associations, charitable organizations, foundations, trusts and employee welfare foundations | 10 | ||
Members of the Executive Committee
Year of birth: 1967
Information and control systems
Auditors
2021 USD million | 2020 USD million | ||||
Audit services | 22.2 | 20.5 | |||
Audit-related services | 1.5 | 1.4 | |||
Tax services | 0.1 | 0.4 | |||
Other services | 1.4 | 1.2 | |||
Total | 25.2 | 23.5 | |||
Information policy
Topic | Information | ||
Share capital | Articles of Incorporation of Novartis AG www.novartis.com/investors/company-overview/corporate-governance Novartis key share data www.novartis.com/investors/share-data-analysis | ||
Shareholder rights | Articles of Incorporation of Novartis AG www.novartis.com/investors/company-overview/corporate-governance | ||
Annual General Meeting of Shareholders | Annual General Meeting of Shareholders www.novartis.com/investors/shareholder-information/annual-general-meeting | ||
Board Regulations | Board Regulations www.novartis.com/investors/company-overview/corporate-governance | ||
Novartis code for senior financial officers | Novartis Code of Ethical Conduct for CEO and Senior Financial Officers www.novartis.com/investors/company-overview/corporate-governance | ||
Novartis in Society Integrated Report | Novartis in Society Integrated Report www.reporting.novartis.com | ||
Novartis financial data | Novartis financial data www.novartis.com/investors/financial-data | ||
Press releases | Press releases www.novartis.com/news/news-archive?type=media_release Free email service www.novartis.com/news/stay-up-to-date | ||
Additional information (including Novartis investor event calendar, registered office, contact and email addresses, phone numbers, etc.) | Novartis Investor Relations www.novartis.com/investors | ||
Quiet periods
6.D Employees
For the year ended December 31, 2021 (full-time equivalents) | Marketing and sales | Production and supply | Research and development | Customer & Technology Solutions1 | General and administration | Total | |||||||
USA | 6 074 | 1 938 | 5 324 | 879 | 654 | 14 869 | |||||||
Canada and Latin America | 3 116 | 1 426 | 510 | 1 116 | 370 | 6 538 | |||||||
Europe | 15 163 | 17 630 | 10 307 | 5 108 | 2 613 | 50 821 | |||||||
Asia/Africa/Australasia | 16 927 | 3 570 | 4 812 | 5 696 | 1 090 | 32 095 | |||||||
Total | 41 280 | 24 564 | 20 953 | 12 799 | 4 727 | 104 323 | |||||||
For the year ended December 31, 2020 (full-time equivalents) | Marketing and sales | Production and supply | Research and development | Customer & Technology Solutions1 | General and administration | Total | |||||||
USA | 5 978 | 2 954 | 5 554 | 636 | 820 | 15 942 | |||||||
Canada and Latin America | 3 405 | 1 286 | 504 | 928 | 401 | 6 524 | |||||||
Europe | 16 066 | 18 628 | 10 043 | 4 506 | 2 852 | 52 095 | |||||||
Asia/Africa/Australasia | 17 240 | 3 346 | 4 537 | 4 991 | 1 119 | 31 233 | |||||||
Total | 42 689 | 26 214 | 20 638 | 11 061 | 5 192 | 105 794 | |||||||
For the year ended December 31, 2019 (full-time equivalents) | Marketing and sales | Production and supply | Research and development | Customer & Technology Solutions1 | General and administration | Total | |||||||
USA | 5 360 | 2 830 | 5 412 | 614 | 763 | 14 979 | |||||||
Canada and Latin America | 3 396 | 838 | 480 | 864 | 397 | 5 975 | |||||||
Europe | 16 395 | 19 386 | 9 988 | 4 352 | 2 666 | 52 787 | |||||||
Asia/Africa/Australasia | 17 455 | 3 163 | 4 296 | 4 233 | 1 026 | 30 173 | |||||||
Total | 42 606 | 26 217 | 20 176 | 10 063 | 4 852 | 103 914 | |||||||
1 relates to full-time equivalent employees from our Customer & Technology Solutions (formerly named Novartis Business Services) organizational unit. |
6.E Share ownership
Item 7. Major Shareholders and Related Party Transactions
7.A Major shareholders
% of respective share capital beneficially owned as of: | |||||||||
Ordinary shares beneficially owned as of Dec 31, 2021 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||||||
Shareholders registered for their own account: | |||||||||
Emasan AG, Basel, Switzerland | 89 135 960 | 3.7 | 3.6 | 3.5 | |||||
Novartis Foundation for Employee Participation, Basel, Switzerland 1 | - | <2.0 | <2.0 | 2.1 | |||||
UBS Fund Management (Switzerland) AG, Basel, Switzerland | 55 730 682 | 2.3 | 2.3 | 2.1 | |||||
Credit Suisse Funds AG, Zurich, Switzerland | 50 012 984 | 2.1 | 2.0 | <2.0 | |||||
1 The Novartis Foundation for Employee Participation (the "Employee Foundation") is a special purpose entity that was founded by, but is independent from, Novartis. |
% of respective share capital held as of: | |||||||||
Ordinary shares held as of Dec 31, 2021 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||||||
Shareholders registered as nominees: | |||||||||
Chase Nominees Ltd., London, England | 213 861 528 | 8.8 | 9.6 | 10.4 | |||||
The Bank of New York Mellon, New York, NY | 72 781 460 | 3.0 | 3.4 | 3.8 | |||||
Through The Bank of New York Mellon, Everett, MA | 38 915 733 | 1.6 | 1.7 | 2.0 | |||||
Through The Bank of New York Mellon, New York, NY | 25 990 663 | 1.1 | 1.2 | 1.2 | |||||
Through The Bank of New York Mellon, SA/NV, Brussels, Belgium | 7 875 064 | 0.3 | 0.5 | 0.6 | |||||
Nortrust Nominees Ltd., London, England | 102 224 686 | 4.2 | 4.2 | 3.9 | |||||
Shareholder acting as American Depositary Share (ADS) depositary: | |||||||||
JPMorgan Chase Bank, N.A., New York, NY | 269 889 074 | 11.1 | 11.7 | 12.5 | |||||
7.B Related party transactions
7.C Interests of experts and counsel
Item 8. Financial Information
8.A Consolidated statements and other financial information
8.B Significant changes
Item 9. The Offer and Listing
9.A Offer and listing details
9.B Plan of distribution
9.C Markets
9.D Selling shareholders
9.E Dilution
9.F Expenses of the issue
Item 10. Additional Information
10.A Share capital
10.B Memorandum and articles of association
10.C Material contracts
10.D Exchange controls
10.E Taxation
10.F Dividends and paying agents
10.G Statement by experts
10.H Documents on display
10.I Subsidiary information
Item 11. Quantitative and Qualitative Disclosures About Market Risk
Item 12. Description of Securities Other Than Equity Securities
12.A Debt securities
12.B Warrants and rights
12.C Other securities
12.D American Depositary Shares
Category | Depositary actions | Associated fee | |||
Depositing or substituting underlying shares | Acceptance of shares surrendered, and issuance of ADRs in exchange, including surrenders and issuances in respect of: — Share distributions — Stock split — Rights — Merger — Exchange of shares or any other transaction or event or other distribution affecting the ADSs or the deposited shares | USD 5.00 for each 100 ADSs (or portion thereof) evidenced by the new ADRs delivered | |||
Withdrawing underlying shares | Acceptance of ADRs surrendered for withdrawal of deposited shares | USD 5.00 for each 100 ADSs (or portion thereof) evidenced by the ADRs surrendered | |||
Selling or exercising rights | Distribution or sale of shares, the fee being in an amount equal to the fee for the execution and delivery of ADRs that would have been charged as a result of the deposit of such shares | USD 5.00 for each 100 ADSs (or portion thereof) | |||
Transferring, splitting or grouping receipts | Transfers, combining or grouping of depositary receipts | USD 1.50 per ADR | |||
Expenses of the depositary | Expenses incurred on behalf of holders in connection with: — Compliance with foreign exchange control regulations or any law or regulation relating to foreign investment — The depositary’s or its custodian’s compliance with applicable law, rule or regulation — Stock transfer or other taxes and other governmental charges — Cable, telex and facsimile transmission and delivery — Expenses of the depositary in connection with the conversion of foreign currency into US dollars (which are paid out of such foreign currency) — Any other charge payable by any of the depositary or its agents | Expenses payable at the sole discretion of the depositary by billing holders or by deducting charges from one or more cash dividends or other cash distributions | |||
Advance tax relief | Tax relief/reclamation process for qualified holders | A depositary service charge of USD 0.008 per ADS | |||
PART II
Item 13. Defaults, Dividend Arrearages and Delinquencies
Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds
Item 15. Controls and Procedures
Item 16A. Audit Committee Financial Expert
Item 16B. Code of Ethics
Item 16C. Principal Accountant Fees and Services
Item 16D. Exemptions from the Listing Standards for Audit Committees
Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers
2021 | Total number of shares purchased (a)1 | Average price paid per share in USD (b) | Total number of shares purchased as part of publicly announced plans or programs (c)2 | Maximum approximate value of shares that may yet be purchased under the plans or programs (CHF millions) (d) | Maximum approximate value of shares that may yet be purchased under the plans or programs (USD millions) (e)3 | ||||||
Jan. 1-31 | 7 732 607 | 94.95 | 6 700 000 | 1 558 | 1 752 | ||||||
Feb. 1-28 | 7 257 307 | 90.14 | 7 035 000 | 990 | 1 094 | ||||||
Mar. 1-31 | 5 903 009 | 85.17 | 5 874 668 | 9 534 | 10 114 | ||||||
Apr. 1-30 | 17 477 | 87.51 | 9 534 | 10 495 | |||||||
May 1-31 | 18 391 | 87.04 | 9 534 | 10 596 | |||||||
Jun. 1-30 | 8 614 128 | 91.82 | 8 600 000 | 8 819 | 9 574 | ||||||
Jul. 1-31 | 10 091 | 90.67 | 8 819 | 9 725 | |||||||
Aug. 1-31 | 65 881 | 91.72 | 8 819 | 9 635 | |||||||
Sep. 1-30 | 26 306 | 92.02 | 8 819 | 9 444 | |||||||
Oct. 1-31 | 37 854 | 83.19 | 8 819 | 9 670 | |||||||
Nov. 1-30 | 23 040 | 84.65 | 8 819 | 9 578 | |||||||
Dec. 1-31 | 2 508 872 | 86.98 | 2 490 000 | 8 620 | 9 426 | ||||||
Total | 32 214 963 | 90.58 | 30 699 668 | ||||||||
1 Column (a) shows shares repurchased on the SIX Swiss Exchange second trading line plus shares we purchased from employees who had obtained the shares through a Novartis Employee Ownership Plan. See "Item 18. Financial Statements - Note 26 Equity-based participation plans for associates." | |||||||||||
2 Column (c) shows shares repurchased on the SIX Swiss Exchange second trading line under the CHF 10 billion share buyback authority approved at the 2019 AGM for transactions before March 2, 2021 and under the CHF 10 billion share buyback authority approved at the 2021 AGM for transactions after such date. See "Item 6. Directors, Senior Management and Employees - Item 6C. Board Practices - Our capital structure - Changes in capital." | |||||||||||
3 Column (e) shows the Swiss franc amount from column (d) converted into US dollars as of the month-end, using the Swiss franc/US dollar exchange rate at the applicable month-end |
Item 16F. Change in Registrant’s Certifying Accountant
Item 16G. Corporate Governance
Item 16H. Mine Safety Disclosure
PART III
Item 17. Financial Statements
Item 18. Financial Statements
Item 19. Exhibits
SIGNATURES
Novartis Group consolidated financial statements
(USD millions unless indicated otherwise) | Note | 2021 | 2020 | 2019 | |||||
Net sales to third parties from continuing operations | 3 | 51 626 | 48 659 | 47 445 | |||||
Sales to discontinued segment | 53 | ||||||||
Net sales from continuing operations | 51 626 | 48 659 | 47 498 | ||||||
Other revenues | 3 | 1 251 | 1 239 | 1 179 | |||||
Cost of goods sold | -15 867 | -15 121 | -14 425 | ||||||
Gross profit from continuing operations | 37 010 | 34 777 | 34 252 | ||||||
Selling, general and administration | -14 886 | -14 197 | -14 369 | ||||||
Research and development | -9 540 | -8 980 | -9 402 | ||||||
Other income | 1 852 | 1 742 | 2 031 | ||||||
Other expense | -2 747 | -3 190 | -3 426 | ||||||
Operating income from continuing operations | 11 689 | 10 152 | 9 086 | ||||||
Income from associated companies | 4 | 15 339 | 673 | 659 | |||||
Interest expense | 5 | -811 | -869 | -850 | |||||
Other financial income and expense | 5 | -80 | -78 | 45 | |||||
Income before taxes from continuing operations | 26 137 | 9 878 | 8 940 | ||||||
Income taxes | 6 | -2 119 | -1 807 | -1 793 | |||||
Net income from continuing operations | 24 018 | 8 071 | 7 147 | ||||||
Net loss from discontinued operations before gain on distribution of Alcon Inc. to Novartis AG shareholders | 30 | -101 | |||||||
Gain on distribution of Alcon Inc. to Novartis AG shareholders | 2 | 4 691 | |||||||
Net income from discontinued operations | 30 | 4 590 | |||||||
Net income | 24 018 | 8 071 | 11 737 | ||||||
Attributable to: | |||||||||
Shareholders of Novartis AG | 24 021 | 8 072 | 11 732 | ||||||
Non-controlling interests | -3 | -1 | 5 | ||||||
Basic earnings per share (USD) from continuing operations | 10.71 | 3.55 | 3.12 | ||||||
Basic earnings per share (USD) from discontinued operations | 2.00 | ||||||||
Total basic earnings per share (USD) | 7 | 10.71 | 3.55 | 5.12 | |||||
Diluted earnings per share (USD) from continuing operations | 10.63 | 3.52 | 3.08 | ||||||
Diluted earnings per share (USD) from discontinued operations | 1.98 | ||||||||
Total diluted earnings per share (USD) | 7 | 10.63 | 3.52 | 5.06 | |||||
The accompanying Notes form an integral part of the consolidated financial statements. |
(USD millions) | Note | 2021 | 2020 | 2019 | |||||
Net income | 24 018 | 8 071 | 11 737 | ||||||
Other comprehensive income | |||||||||
Items that are or may be recycled into the consolidated income statement | |||||||||
Fair value adjustments on debt securities, net of taxes | 8 | 1 | |||||||
Fair value adjustments on deferred cash flow hedges, net of taxes | 8 | 1 | |||||||
Total fair value adjustments on financial instruments, net of taxes | 2 | ||||||||
Novartis share of other comprehensive income recognized by associated companies, net of taxes | 4 | 46 | -56 | -94 | |||||
Net investment hedge, net of taxes | 8 | 216 | -201 | 44 | |||||
Currency translation effects, net of taxes | 8 | -4 762 | 3 194 | 352 | |||||
Total of items that are or may be recycled | -4 500 | 2 937 | 304 | ||||||
Items that will never be recycled into the consolidated income statement | |||||||||
Actuarial gains/(losses) from defined benefit plans, net of taxes | 8 | 1 809 | 143 | -467 | |||||
Fair value adjustments on equity securities, net of taxes | 8 | 194 | 250 | -47 | |||||
Total of items that will never be recycled | 2 003 | 393 | -514 | ||||||
Total comprehensive income | 21 521 | 11 401 | 11 527 | ||||||
Attributable to: | |||||||||
Shareholders of Novartis AG | 21 528 | 11 403 | 11 525 | ||||||
Continuing operations | 21 528 | 11 403 | 6 948 | ||||||
Discontinued operations | 4 577 | ||||||||
Non-controlling interests | -7 | -2 | 2 | ||||||
The accompanying Notes form an integral part of the consolidated financial statements. |
(USD millions) | Note | 2021 | 20201 | ||||
Assets | |||||||
Non-current assets | |||||||
Property, plant and equipment | 9 | 11 545 | 12 263 | ||||
Right-of-use assets | 10 | 1 561 | 1 676 | ||||
Goodwill | 11 | 29 595 | 29 999 | ||||
Intangible assets other than goodwill | 11 | 34 182 | 36 809 | ||||
Investments in associated companies | 4 | 205 | 9 632 | ||||
Deferred tax assets | 12 | 3 743 | 3 933 | ||||
Financial assets | 13 | 3 036 | 2 901 | ||||
Other non-current assets | 13 | 2 210 | 892 | ||||
Total non-current assets | 86 077 | 98 105 | |||||
Current assets | |||||||
Inventories | 14 | 6 666 | 7 131 | ||||
Trade receivables | 15 | 8 005 | 8 217 | ||||
Income tax receivables | 278 | 239 | |||||
Marketable securities, commodities, time deposits and derivative financial instruments | 16 | 15 922 | 1 905 | ||||
Cash and cash equivalents | 16 | 12 407 | 9 658 | ||||
Other current assets | 17 | 2 440 | 2 523 | ||||
Total current assets | 45 718 | 29 673 | |||||
Total assets | 131 795 | 127 778 | |||||
Equity and liabilities | |||||||
Equity | |||||||
Share capital | 18 | 901 | 913 | ||||
Treasury shares | 18 | -48 | -53 | ||||
Reserves | 66 802 | 55 738 | |||||
Equity attributable to Novartis AG shareholders | 67 655 | 56 598 | |||||
Non-controlling interests | 167 | 68 | |||||
Total equity | 67 822 | 56 666 | |||||
Liabilities | |||||||
Non-current liabilities | |||||||
Financial debts | 19 | 22 902 | 26 259 | ||||
Lease liabilities | 10 | 1 621 | 1 719 | ||||
Deferred tax liabilities | 12 | 3 070 | 3 141 | ||||
Provisions and other non-current liabilities | 20 | 6 172 | 6 934 | ||||
Total non-current liabilities | 33 765 | 38 053 | |||||
Current liabilities | |||||||
Trade payables | 5 553 | 5 403 | |||||
Financial debts and derivative financial instruments | 21 | 6 295 | 9 785 | ||||
Lease liabilities | 10 | 275 | 286 | ||||
Current income tax liabilities | 2 415 | 2 458 | |||||
Provisions and other current liabilities | 22 | 15 670 | 15 127 | ||||
Total current liabilities | 30 208 | 33 059 | |||||
Total liabilities | 63 973 | 71 112 | |||||
Total equity and liabilities | 131 795 | 127 778 | |||||
The accompanying Notes form an integral part of the consolidated financial statements. | |||||||
��1 The December 31, 2020 deferred tax assets and deferred tax liabilities balances have been adjusted to conform with the 2021 presentation, see Note 12 for additional disclosures. |
Reserves | |||||||||||||||||
(USD millions) | Note | Share capital | Treasury shares | Retained earnings | Total value adjustments | Equity attributable to Novartis shareholders | Non- controlling interests | Total equity | |||||||||
Total equity at December 31, 2018, as previously reported | 944 | -69 | 82 191 | -4 452 | 78 614 | 78 | 78 692 | ||||||||||
Impact of change in accounting policies | 3 | 3 | 3 | ||||||||||||||
Restated equity at January 1, 2019 | 944 | -69 | 82 194 | -4 452 | 78 617 | 78 | 78 695 | ||||||||||
Net income | 11 732 | 11 732 | 5 | 11 737 | |||||||||||||
Other comprehensive income | 8 | -94 | -113 | -207 | -3 | -210 | |||||||||||
Total comprehensive income | 11 638 | -113 | 11 525 | 2 | 11 527 | ||||||||||||
Dividends | 18.1 | -6 645 | -6 645 | -6 645 | |||||||||||||
Dividend in kind to effect the spin-off of Alcon Inc. | 2 | -23 434 | -23 434 | -23 434 | |||||||||||||
Purchase of treasury shares | 18.2 | -31 | -5 480 | -5 511 | -5 511 | ||||||||||||
Reduction of share capital | 18 | -8 | 12 | -4 | |||||||||||||
Exercise of options and employee transactions | 18.2 | 3 | 207 | 210 | 210 | ||||||||||||
Equity-based compensation | 18.2 | 5 | 828 | 833 | 833 | ||||||||||||
Shares delivered to Alcon employees as a result of the Alcon spin-off | 18.2 | 18 | 18 | 18 | |||||||||||||
Taxes on treasury share transactions | -189 | -189 | -189 | ||||||||||||||
Decrease of treasury share repurchase obligation under a share buyback trading plan | 18.3 | 284 | 284 | 284 | |||||||||||||
Transaction costs, net of taxes | 18.8 | -253 | -253 | -253 | |||||||||||||
Fair value adjustments on financial assets sold | 8 | 95 | -95 | ||||||||||||||
Impact of change in ownership of consolidated entities | 18.5 | -3 | -3 | -2 | -5 | ||||||||||||
Changes in non-controlling interests | 18.6 | -1 | -1 | ||||||||||||||
Fair value adjustments related to divestments | 8 | -3 | 3 | ||||||||||||||
Other movements | 18.7 | 22 | 22 | 22 | |||||||||||||
Total of other equity movements | -8 | -11 | -34 557 | -92 | -34 668 | -3 | -34 671 | ||||||||||
Total equity at December 31, 2019 | 936 | -80 | 59 275 | -4 657 | 55 474 | 77 | 55 551 | ||||||||||
Net income | 8 072 | 8 072 | -1 | 8 071 | |||||||||||||
Other comprehensive income | 8 | -56 | 3 387 | 3 331 | -1 | 3 330 | |||||||||||
Total comprehensive income | 8 016 | 3 387 | 11 403 | -2 | 11 401 | ||||||||||||
Dividends | 18.1 | -6 987 | -6 987 | -6 987 | |||||||||||||
Purchase of treasury shares | 18.2 | -18 | -3 038 | -3 056 | -3 056 | ||||||||||||
Reduction of share capital | 18 | -23 | 31 | -8 | |||||||||||||
Exercise of options and employee transactions | 18.2 | 8 | 798 | 806 | 806 | ||||||||||||
Repurchase of options | 18.4 | -89 | -89 | -89 | |||||||||||||
Equity-based compensation | 18.2 | 6 | 724 | 730 | 730 | ||||||||||||
Shares delivered to Alcon employees as a result of the Alcon spin-off | 18.2 | 0 | 30 | 30 | 30 | ||||||||||||
Taxes on treasury share transactions | 32 | 32 | 32 | ||||||||||||||
Increase of treasury share repurchase obligation under a share buyback trading plan | 18.3 | -1 769 | -1 769 | -1 769 | |||||||||||||
Fair value adjustments on financial assets sold | 8 | 150 | -150 | ||||||||||||||
Fair value adjustments related to divestments | 8 | -2 | 2 | ||||||||||||||
Impact of change in ownership of consolidated entities | 18.5 | 7 | -1 | 6 | -7 | -1 | |||||||||||
Other movements | 18.7 | 18 | 18 | 18 | |||||||||||||
Total of other equity movements | -23 | 27 | -10 134 | -149 | -10 279 | -7 | -10 286 | ||||||||||
Total equity at December 31, 2020 | 913 | -53 | 57 157 | -1 419 | 56 598 | 68 | 56 666 | ||||||||||
Net income | 24 021 | 24 021 | -3 | 24 018 | |||||||||||||
Other comprehensive income | 8 | 46 | -2 539 | -2 493 | -4 | -2 497 | |||||||||||
Total comprehensive income | 24 067 | -2 539 | 21 528 | -7 | 21 521 | ||||||||||||
Dividends | 18.1 | -7 368 | -7 368 | -7 368 | |||||||||||||
Purchase of treasury shares | 18.2 | -18 | -2 902 | -2 920 | -2 920 | ||||||||||||
Reduction of share capital | 18 | -12 | 18 | -6 | |||||||||||||
Exercise of options and employee transactions | 18.2 | 0 | 39 | 39 | 39 | ||||||||||||
Equity-based compensation | 18.2 | 5 | 740 | 745 | 745 | ||||||||||||
Shares delivered to Alcon employees as a result of the Alcon spin-off | 18.2 | 0 | 17 | 17 | 17 | ||||||||||||
Taxes on treasury share transactions | 1 | 1 | 1 | ||||||||||||||
Increase of treasury share repurchase obligation under a share buyback trading plan | 18.3 | -1 040 | -1 040 | -1 040 | |||||||||||||
Transaction costs, net of taxes | 18.8 | 12 | 12 | 12 | |||||||||||||
Changes in non-controlling interests | 18.6 | -1 | -1 | ||||||||||||||
Fair value adjustments on financial assets sold | 8 | 164 | -164 | ||||||||||||||
Fair value adjustments related to divestments | 8 | 65 | -65 | ||||||||||||||
Impact of change in ownership of consolidated entities | 18.5 | -5 | 0 | -5 | 107 | 102 | |||||||||||
Other movements | 18.7 | 48 | 48 | 48 | |||||||||||||
Total of other equity movements | -12 | 5 | -10 235 | -229 | -10 471 | 106 | -10 365 | ||||||||||
Total equity at December 31, 2021 | 901 | -48 | 70 989 | -4 187 | 67 655 | 167 | 67 822 | ||||||||||
The accompanying Notes form an integral part of the consolidated financial statements. |
(USD millions) | Note | 2021 | 2020 | 2019 | |||||
Net income from continuing operations | 24 018 | 8 071 | 7 147 | ||||||
Adjustments to reconcile net income from continuing operations to net cash flows from operating activities from continuing operations | |||||||||
Reversal of non-cash items and other adjustments | 23.1 | -5 299 | 9 881 | 9 122 | |||||
Dividends received from associated companies and others | 525 | 490 | 463 | ||||||
Interest received | 13 | 47 | 214 | ||||||
Interest paid | -664 | -703 | -793 | ||||||
Other financial receipts | 464 | 28 | |||||||
Other financial payments | -302 | -39 | -33 | ||||||
Income taxes paid | 23.2 | -2 342 | -1 833 | -1 876 | |||||
Net cash flows from operating activities from continuing operations before working capital and provision changes | 15 949 | 16 378 | 14 272 | ||||||
Payments out of provisions and other net cash movements in non-current liabilities | -1 119 | -2 437 | -924 | ||||||
Change in net current assets and other operating cash flow items | 23.3 | 241 | -291 | 199 | |||||
Net cash flows from operating activities from continuing operations | 15 071 | 13 650 | 13 547 | ||||||
Net cash flows from operating activities from discontinued operations | 78 | ||||||||
Net cash flows from operating activities | 15 071 | 13 650 | 13 625 | ||||||
Purchases of property, plant and equipment | -1 378 | -1 275 | -1 379 | ||||||
Proceeds from sale of property, plant and equipment | 240 | 88 | 857 | ||||||
Purchases of intangible assets | -1 593 | -1 310 | -878 | ||||||
Proceeds from sale of intangible assets | 748 | 380 | 973 | ||||||
Purchases of financial assets | -191 | -230 | -302 | ||||||
Proceeds from sale of financial assets | 442 | 723 | 1 152 | ||||||
Purchases of other non-current assets | -61 | -61 | -60 | ||||||
Proceeds from sale of other non-current assets | 4 | 2 | 3 | ||||||
Divestments and acquisitions of interests in associated companies, net | 23.4 | 20 669 | -7 | -6 | |||||
Acquisitions and divestments of businesses, net | 23.5 | -567 | -9 957 | -3 760 | |||||
Purchases of marketable securities, commodities and time deposits | -16 403 | -1 900 | -228 | ||||||
Proceeds from sale of marketable securities, commodities and time deposits | 2 298 | 492 | 2 561 | ||||||
Net cash flows from/used in investing activities from continuing operations | 4 208 | -13 055 | -1 067 | ||||||
Net cash flows used in investing activities from discontinued operations | 30 | -127 | -1 159 | ||||||
Net cash flows from/used in investing activities | 4 208 | -13 182 | -2 226 | ||||||
Dividends paid to shareholders of Novartis AG | -7 368 | -6 987 | -6 645 | ||||||
Acquisitions of treasury shares | -3 057 | -2 842 | -5 533 | ||||||
Proceeds from exercised options and other treasury share transactions, net | 53 | 748 | 201 | ||||||
Increase in non-current financial debts | 23.6 | 16 | 7 126 | 93 | |||||
Repayments of non-current financial debts | 23.6 | -2 162 | -2 003 | -3 195 | |||||
Change in current financial debts | 23.6 | -3 524 | 2 261 | -1 582 | |||||
Payments of lease liabilities, net | 23.6 | -316 | -312 | -273 | |||||
Impact of change in ownership of consolidated entities | -3 | -2 | -6 | ||||||
Other financing cash flows, net | 97 | -147 | 56 | ||||||
Net cash flows used in financing activities from continuing operations | -16 264 | -2 158 | -16 884 | ||||||
Net cash flows used in/from financing activities from discontinued operations | 30 | -50 | 3 257 | ||||||
Net cash flows used in financing activities | -16 264 | -2 208 | -13 627 | ||||||
Net change in cash and cash equivalents before effect of exchange rate changes | 3 015 | -1 740 | -2 228 | ||||||
Effect of exchange rate changes on cash and cash equivalents | -266 | 286 | 69 | ||||||
Net change in cash and cash equivalents | 2 749 | -1 454 | -2 159 | ||||||
Cash and cash equivalents at January 1 | 9 658 | 11 112 | 13 271 | ||||||
Cash and cash equivalents at December 31 | 12 407 | 9 658 | 11 112 | ||||||
The accompanying Notes form an integral part of the consolidated financial statements. |
Notes to the Novartis Group consolidated financial statements
Useful life | |||
Buildings | 20 to 40 years | ||
Machinery and other equipment | |||
Machinery and equipment | 7 to 20 years | ||
Furniture and vehicles | 5 to 10 years | ||
Computer hardware | 3 to 7 years | ||
Useful life | Income statement line for amortization and impairment charges | ||||
Currently marketed products | 5 to 20 years | "Cost of goods sold" | |||
Technologies | 10 to 20 years | "Cost of goods sold" or "Research and development" | |||
Other (including computer software) | 3 to 12 years | In the relevant functional expense | |||
(USD millions) | April 8, 2019 | ||
Net assets derecognized | -20 025 | ||
Derecognition of distribution liability | 23 434 | ||
Difference between net assets and distribution liability | 3 409 | ||
Recognition of Alcon Inc. shares obtained through consolidated foundations | 1 273 | ||
Currency translation gains recycled into the consolidated income statement | 123 | ||
Transaction costs recognized in the consolidated income statement | -114 | ||
Gain on distribution of Alcon Inc. to Novartis AG shareholders | 4 691 | ||
Innovative Medicines | Sandoz | Corporate (including eliminations) | Group | ||||||||||||||
(USD millions) | 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | |||||||||
Net sales to third parties | 41 995 | 39 013 | 9 631 | 9 646 | 51 626 | 48 659 | |||||||||||
Sales to other segments | 795 | 792 | 180 | 189 | -975 | -981 | |||||||||||
Net sales | 42 790 | 39 805 | 9 811 | 9 835 | -975 | -981 | 51 626 | 48 659 | |||||||||
Other revenues | 1 179 | 1 018 | 61 | 53 | 11 | 168 | 1 251 | 1 239 | |||||||||
Cost of goods sold | -11 751 | -10 927 | -5 147 | -5 252 | 1 031 | 1 058 | -15 867 | -15 121 | |||||||||
Gross profit | 32 218 | 29 896 | 4 725 | 4 636 | 67 | 245 | 37 010 | 34 777 | |||||||||
Selling, general and administration | -12 306 | -11 657 | -2 062 | -2 076 | -518 | -464 | -14 886 | -14 197 | |||||||||
Research and development | -8 641 | -8 118 | -899 | -862 | -9 540 | -8 980 | |||||||||||
Other income | 1 149 | 922 | 233 | 176 | 470 | 644 | 1 852 | 1 742 | |||||||||
Other expense | -1 732 | -1 871 | -397 | -831 | -618 | -488 | -2 747 | -3 190 | |||||||||
Operating income | 10 688 | 9 172 | 1 600 | 1 043 | -599 | -63 | 11 689 | 10 152 | |||||||||
Income from associated companies | 5 | 1 | 2 | 2 | 15 332 | 670 | 15 339 | 673 | |||||||||
Interest expense | -811 | -869 | |||||||||||||||
Other financial income and expense | -80 | -78 | |||||||||||||||
Income before taxes | 26 137 | 9 878 | |||||||||||||||
Income taxes | -2 119 | -1 807 | |||||||||||||||
Net income | 24 018 | 8 071 | |||||||||||||||
Attributable to: | |||||||||||||||||
Shareholders of Novartis AG | 24 021 | 8 072 | |||||||||||||||
Non-controlling interests | -3 | -1 | |||||||||||||||
Included in net income are: | |||||||||||||||||
Interest income | 71 | 91 | |||||||||||||||
Depreciation of property, plant and equipment | -859 | -912 | -210 | -282 | -139 | -124 | -1 208 | -1 318 | |||||||||
Depreciation of right-of-use assets | -265 | -273 | -39 | -41 | -14 | -16 | -318 | -330 | |||||||||
Amortization of intangible assets | -3 638 | -3 080 | -238 | -370 | -27 | -12 | -3 903 | -3 462 | |||||||||
Impairment charges on property, plant and equipment, net | -271 | -324 | -9 | -116 | -1 | -281 | -440 | ||||||||||
Impairment charges on intangible assets, net | -367 | -768 | -28 | -141 | -8 | -5 | -403 | -914 | |||||||||
Impairment charges and fair value changes on financial assets, net | 43 | 153 | -5 | 182 | 38 | 335 | |||||||||||
Additions to restructuring provisions | -240 | -217 | -62 | -98 | -26 | -39 | -328 | -354 | |||||||||
Equity-based compensation of Novartis equity plans | -721 | -714 | -65 | -64 | -193 | -180 | -979 | -958 | |||||||||
Innovative Medicines | Sandoz | Corporate (including eliminations) | Group | ||||||||||||||
(USD millions) | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | |||||||||
Net sales to third parties from continuing operations | 39 013 | 37 714 | 9 646 | 9 731 | 48 659 | 47 445 | |||||||||||
Sales to continuing and discontinued segments | 792 | 783 | 189 | 141 | -981 | -871 | 53 | ||||||||||
Net sales from continuing operations | 39 805 | 38 497 | 9 835 | 9 872 | -981 | -871 | 48 659 | 47 498 | |||||||||
Other revenues | 1 018 | 1 092 | 53 | 63 | 168 | 24 | 1 239 | 1 179 | |||||||||
Cost of goods sold | -10 927 | -10 050 | -5 252 | -5 334 | 1 058 | 959 | -15 121 | -14 425 | |||||||||
Gross profit from continuing operations | 29 896 | 29 539 | 4 636 | 4 601 | 245 | 112 | 34 777 | 34 252 | |||||||||
Selling, general and administration | -11 657 | -11 617 | -2 076 | -2 218 | -464 | -534 | -14 197 | -14 369 | |||||||||
Research and development | -8 118 | -8 152 | -862 | -1 250 | -8 980 | -9 402 | |||||||||||
Other income | 922 | 1 586 | 176 | 167 | 644 | 278 | 1 742 | 2 031 | |||||||||
Other expense | -1 871 | -2 069 | -831 | -749 | -488 | -608 | -3 190 | -3 426 | |||||||||
Operating income from continuing operations | 9 172 | 9 287 | 1 043 | 551 | -63 | -752 | 10 152 | 9 086 | |||||||||
Income from associated companies | 1 | 1 | 2 | 2 | 670 | 656 | 673 | 659 | |||||||||
Interest expense | -869 | -850 | |||||||||||||||
Other financial income and expense | -78 | 45 | |||||||||||||||
Income before taxes from continuing operations | 9 878 | 8 940 | |||||||||||||||
Income taxes | -1 807 | -1 793 | |||||||||||||||
Net income from continuing operations | 8 071 | 7 147 | |||||||||||||||
Net loss from discontinued operations before gain on distribution of Alcon Inc. to Novartis AG shareholders | -101 | ||||||||||||||||
Gain on distribution of Alcon Inc. to Novartis AG shareholders | 4 691 | ||||||||||||||||
Net income from discontinued operations | 4 590 | ||||||||||||||||
Net income | 8 071 | 11 737 | |||||||||||||||
Attributable to: | |||||||||||||||||
Shareholders of Novartis AG | 8 072 | 11 732 | |||||||||||||||
Non-controlling interests | -1 | 5 | |||||||||||||||
Included in net income from continuing operations are: | |||||||||||||||||
Interest income | 91 | 245 | |||||||||||||||
Depreciation of property, plant and equipment | -912 | -952 | -282 | -283 | -124 | -110 | -1 318 | -1 345 | |||||||||
Depreciation of right-of-use assets | -273 | -247 | -41 | -41 | -16 | -17 | -330 | -305 | |||||||||
Amortization of intangible assets | -3 080 | -2 509 | -370 | -315 | -12 | -12 | -3 462 | -2 836 | |||||||||
Impairment charges on property, plant and equipment, net | -324 | -100 | -116 | -101 | -1 | -440 | -202 | ||||||||||
Impairment charges on intangible assets, net | -768 | -632 | -141 | -506 | -5 | -914 | -1 138 | ||||||||||
Impairment charges and fair value changes on financial assets, net | 153 | 18 | 182 | 20 | 335 | 38 | |||||||||||
Additions to restructuring provisions | -217 | -229 | -98 | -165 | -39 | -98 | -354 | -492 | |||||||||
Equity-based compensation of Novartis equity plans | -714 | -761 | -64 | -67 | -180 | -239 | -958 | -1 067 | |||||||||
Innovative Medicines | Sandoz | Corporate (including eliminations) | Group | ||||||||||||||
(USD millions) | 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | |||||||||
Total assets 1 | 79 220 | 83 112 | 16 192 | 16 825 | 36 383 | 27 841 | 131 795 | 127 778 | |||||||||
Total liabilities 1 | -15 929 | -15 472 | -3 632 | -3 786 | -44 412 | -51 854 | -63 973 | -71 112 | |||||||||
Total equity | 67 822 | 56 666 | |||||||||||||||
Net debt 2 | 868 | 24 481 | 868 | 24 481 | |||||||||||||
Net operating assets | 63 291 | 67 640 | 12 560 | 13 039 | -7 161 | 468 | 68 690 | 81 147 | |||||||||
Included in assets and liabilities are: | |||||||||||||||||
Total property, plant and equipment | 9 168 | 9 863 | 1 901 | 1 849 | 476 | 551 | 11 545 | 12 263 | |||||||||
Additions to property, plant and equipment 3 | 991 | 926 | 349 | 229 | 90 | 110 | 1 430 | 1 265 | |||||||||
Total right-of-use assets | 1 349 | 1 489 | 104 | 133 | 108 | 54 | 1 561 | 1 676 | |||||||||
Additions to right-of-use assets 3 | 222 | 264 | 26 | 67 | 73 | 15 | 321 | 346 | |||||||||
Total goodwill and intangible assets | 53 919 | 56 839 | 9 603 | 9 817 | 255 | 152 | 63 777 | 66 808 | |||||||||
Additions to goodwill and intangible assets 3 | 1 491 | 1 235 | 102 | 105 | 143 | 85 | 1 736 | 1 425 | |||||||||
Total investment in associated companies | 170 | 194 | 7 | 8 | 28 | 9 430 | 205 | 9 632 | |||||||||
Additions to investment in associated companies | 24 | 24 | 19 | 7 | 43 | 31 | |||||||||||
Cash and cash equivalents, marketable securities, commodities, time deposits and derivative financial instruments | 28 329 | 11 563 | 28 329 | 11 563 | |||||||||||||
Financial debts and derivative financial instruments | 29 197 | 36 044 | 29 197 | 36 044 | |||||||||||||
Current income tax and deferred tax liabilities 1 | 5 485 | 5 599 | 5 485 | 5 599 | |||||||||||||
1 The December 31, 2020 total assets, total liabilities and deferred tax liabilities have been adjusted from the previously reported amounts due to a change in the presentation of the deferred tax assets and deferred tax liabilities on the consolidated balance sheet, to conform with the 2021 presentation (see Note 12 for additional disclosures). | |||||||||||||||||
2 Note 29 provides additional disclosures related to net debt | |||||||||||||||||
3 Excluding the impact of business acquisitions |
Net sales1 | Total of selected non-current assets2 | ||||||||||||||||||||
(USD millions) | 2021 | % | 2020 | % | 2019 | % | 2021 | % | 2020 | % | |||||||||||
Country | |||||||||||||||||||||
Switzerland | 873 | 2 | 800 | 2 | 848 | 2 | 25 770 | 33 | 34 904 | 39 | |||||||||||
United States | 16 818 | 33 | 16 484 | 34 | 16 280 | 34 | 37 054 | 48 | 39 889 | 44 | |||||||||||
France | 2 522 | 5 | 2 442 | 5 | 2 442 | 5 | 3 615 | 5 | 4 115 | 5 | |||||||||||
Germany | 4 870 | 9 | 4 518 | 9 | 4 120 | 9 | 2 378 | 3 | 2 607 | 3 | |||||||||||
China | 3 052 | 6 | 2 573 | 5 | 2 214 | 5 | 703 | 1 | 714 | 1 | |||||||||||
Japan | 2 683 | 5 | 2 804 | 6 | 2 656 | 6 | 217 | 313 | |||||||||||||
Other | 20 808 | 40 | 19 038 | 39 | 18 885 | 39 | 7 351 | 10 | 7 837 | 8 | |||||||||||
Group | 51 626 | 100 | 48 659 | 100 | 47 445 | 100 | 77 088 | 100 | 90 379 | 100 | |||||||||||
Region | |||||||||||||||||||||
Europe | 20 197 | 39 | 18 715 | 38 | 17 933 | 38 | 37 525 | 49 | 47 798 | 53 | |||||||||||
Americas | 20 463 | 40 | 19 725 | 41 | 19 713 | 41 | 37 522 | 49 | 40 391 | 45 | |||||||||||
Asia/Africa/Australasia | 10 966 | 21 | 10 219 | 21 | 9 799 | 21 | 2 041 | 2 | 2 190 | 2 | |||||||||||
Group | 51 626 | 100 | 48 659 | 100 | 47 445 | 100 | 77 088 | 100 | 90 379 | 100 | |||||||||||
1 Net sales to third party from continuing operations by location of customer | |||||||||||||||||||||
2 Total of property, plant and equipment; right-of-use assets; goodwill; intangible assets and investment in associated companies |
2021 USD m | 2020 USD m | Change (2020 to 2021) USD % | 2019 USD m | Change (2019 to 2020) USD % | |||||||
Innovative Medicines | |||||||||||
Europe | 14 919 | 13 484 | 11 | 12 818 | 5 | ||||||
US | 14 999 | 14 342 | 5 | 13 789 | 4 | ||||||
Asia/Africa/Australasia | 9 304 | 8 718 | 7 | 8 458 | 3 | ||||||
Canada and Latin America | 2 773 | 2 469 | 12 | 2 649 | -7 | ||||||
Total | 41 995 | 39 013 | 8 | 37 714 | 3 | ||||||
Of which in Established Markets | 31 459 | 29 643 | 6 | 28 573 | 4 | ||||||
Of which in Emerging Growth Markets | 10 536 | 9 370 | 12 | 9 141 | 3 | ||||||
Sandoz | |||||||||||
Europe | 5 278 | 5 231 | 1 | 5 115 | 2 | ||||||
US | 1 819 | 2 142 | -15 | 2 491 | -14 | ||||||
Asia/Africa/Australasia | 1 662 | 1 501 | 11 | 1 341 | 12 | ||||||
Canada and Latin America | 872 | 772 | 13 | 784 | -2 | ||||||
Total | 9 631 | 9 646 | 0 | 9 731 | -1 | ||||||
Of which in Established Markets | 6 855 | 7 089 | -3 | 7 111 | 0 | ||||||
Of which in Emerging Growth Markets | 2 776 | 2 557 | 9 | 2 620 | -2 | ||||||
Group | |||||||||||
Europe | 20 197 | 18 715 | 8 | 17 933 | 4 | ||||||
US | 16 818 | 16 484 | 2 | 16 280 | 1 | ||||||
Asia/Africa/Australasia | 10 966 | 10 219 | 7 | 9 799 | 4 | ||||||
Canada and Latin America | 3 645 | 3 241 | 12 | 3 433 | -6 | ||||||
Total | 51 626 | 48 659 | 6 | 47 445 | 3 | ||||||
Of which in Established Markets | 38 314 | 36 732 | 4 | 35 684 | 3 | ||||||
Of which in Emerging Growth Markets | 13 312 | 11 927 | 12 | 11 761 | 1 | ||||||
1 Net sales to third parties by location of customer. Emerging Growth Markets comprise all markets other than the Established Markets of the US, Canada, Western Europe, Japan, Australia and New Zealand. | |||||||||||
2021 USD m | 2020 USD m | Change (2020 to 2021) USD % | 2019 USD m | Change (2019 to 2020) USD % | |||||||
Hematology | |||||||||||
Tasigna | 2 060 | 1 958 | 5 | 1 880 | 4 | ||||||
Promacta/Revolade | 2 016 | 1 738 | 16 | 1 416 | 23 | ||||||
Jakavi | 1 595 | 1 339 | 19 | 1 114 | 20 | ||||||
Gleevec/Glivec | 1 024 | 1 188 | -14 | 1 263 | -6 | ||||||
Kymriah | 587 | 474 | 24 | 278 | 71 | ||||||
Exjade/Jadenu | 563 | 653 | -14 | 975 | -33 | ||||||
Adakveo | 164 | 105 | 56 | 1 | nm | ||||||
Other | 354 | 327 | 8 | 306 | 7 | ||||||
Total Hematology | 8 363 | 7 782 | 7 | 7 233 | 8 | ||||||
Solid Tumor | |||||||||||
Tafinlar + Mekinist | 1 693 | 1 542 | 10 | 1 338 | 15 | ||||||
Sandostatin | 1 413 | 1 439 | -2 | 1 585 | -9 | ||||||
Afinitor/Votubia | 938 | 1 083 | -13 | 1 539 | -30 | ||||||
Kisqali | 937 | 687 | 36 | 480 | 43 | ||||||
Votrient | 577 | 635 | -9 | 755 | -16 | ||||||
Lutathera | 475 | 445 | 7 | 441 | 1 | ||||||
Piqray | 329 | 320 | 3 | 116 | 176 | ||||||
Tabrecta | 90 | 35 | 157 | nm | |||||||
Other | 661 | 743 | -11 | 883 | -16 | ||||||
Total Solid Tumor | 7 113 | 6 929 | 3 | 7 137 | -3 | ||||||
Total Novartis Oncology business unit | 15 476 | 14 711 | 5 | 14 370 | 2 | ||||||
Immunology, Hepatology and Dermatology | |||||||||||
Cosentyx | 4 718 | 3 995 | 18 | 3 551 | 13 | ||||||
Ilaris | 1 059 | 873 | 21 | 671 | 30 | ||||||
Total Immunology, Hepatology and Dermatology | 5 777 | 4 868 | 19 | 4 222 | 15 | ||||||
Neuroscience | |||||||||||
Gilenya | 2 787 | 3 003 | -7 | 3 223 | -7 | ||||||
Zolgensma | 1 351 | 920 | 47 | 361 | 155 | ||||||
Kesimpta | 372 | 15 | nm | nm | |||||||
Mayzent | 281 | 170 | 65 | 26 | nm | ||||||
Aimovig | 215 | 164 | 31 | 103 | 59 | ||||||
Other | 46 | 51 | -10 | 60 | -15 | ||||||
Total Neuroscience | 5 052 | 4 323 | 17 | 3 773 | 15 | ||||||
Ophthalmology | |||||||||||
Lucentis | 2 160 | 1 933 | 12 | 2 086 | -7 | ||||||
Xiidra | 468 | 376 | 24 | 192 | 96 | ||||||
Beovu | 186 | 190 | -2 | 35 | nm | ||||||
Other | 1 516 | 1 911 | -21 | 2 463 | -22 | ||||||
Total Ophthalmology | 4 330 | 4 410 | -2 | 4 776 | -8 | ||||||
2021 USD m | 2020 USD m | Change (2020 to 2021) USD % | 2019 USD m | Change (2019 to 2020) USD % | |||||||
Cardiovascular, Renal and Metabolism | |||||||||||
Entresto | 3 548 | 2 497 | 42 | 1 726 | 45 | ||||||
Leqvio | 12 | nm | |||||||||
Other | 1 | nm | 24 | -96 | |||||||
Total Cardiovascular, Renal and Metabolism | 3 560 | 2 498 | 43 | 1 750 | 43 | ||||||
Respiratory and Allergy | |||||||||||
Xolair 1 | 1 428 | 1 251 | 14 | 1 173 | 7 | ||||||
Ultibro Group | 584 | 623 | -6 | 630 | -1 | ||||||
Other | 53 | 26 | 104 | 22 | 18 | ||||||
Total Respiratory and Allergy | 2 065 | 1 900 | 9 | 1 825 | 4 | ||||||
Established Medicines | |||||||||||
Galvus Group | 1 092 | 1 199 | -9 | 1 297 | -8 | ||||||
Exforge Group | 901 | 980 | -8 | 1 025 | -4 | ||||||
Diovan Group | 773 | 1 003 | -23 | 1 064 | -6 | ||||||
Zortress/Certican | 431 | 452 | -5 | 485 | -7 | ||||||
Voltaren/Cataflam | 373 | 360 | 4 | 417 | -14 | ||||||
Neoral/Sandimmun(e) | 368 | 393 | -6 | 419 | -6 | ||||||
Contract manufacturing | 108 | nm | |||||||||
Other | 1 689 | 1 916 | -12 | 2 291 | -16 | ||||||
Total Established Medicines | 5 735 | 6 303 | -9 | 6 998 | -10 | ||||||
Total Novartis Pharmaceuticals business unit | 26 519 | 24 302 | 9 | 23 344 | 4 | ||||||
Total division net sales | 41 995 | 39 013 | 8 | 37 714 | 3 | ||||||
1 Net sales reflect Xolair sales for all indications. | |||||||||||
nm = not meaningful |
Brands | Business franchise | Key indication | US USD m | Rest of world USD m | Total USD m | ||||||
Cosentyx | Immunology, Hepatology and Dermatology | Psoriasis, ankylosing spondylitis, psoriatic arthritis and non-radiographic axial spondyloarthritis | 2 883 | 1 835 | 4 718 | ||||||
Entresto | Cardiovascular, Renal and Metabolism | Chronic heart failure | 1 712 | 1 836 | 3 548 | ||||||
Gilenya | Neuroscience | Relapsing multiple sclerosis | 1 427 | 1 360 | 2 787 | ||||||
Lucentis | Ophthalmology | Age-related macular degeneration | 2 160 | 2 160 | |||||||
Tasigna | Hematology | Chronic myeloid leukemia | 882 | 1 178 | 2 060 | ||||||
Promacta/Revolade | Hematology | Immune thrombocytopenia (ITP), severe aplastic anemia (SAA) | 947 | 1 069 | 2 016 | ||||||
Tafinlar + Mekinist | Solid Tumor | BRAF V600+ metastatic and adjuvant melanoma; advanced non-small cell lung cancer (NSCLC) | 606 | 1 087 | 1 693 | ||||||
Jakavi | Hematology | Myelofibrosis (MF), polycythemia vera (PV) | 1 595 | 1 595 | |||||||
Xolair 1 | Respiratory and Allergy | Severe allergic asthma (SAA), chronic spontaneous urticaria (CSU) and nasal polyps | 1 428 | 1 428 | |||||||
Sandostatin | Solid Tumor | Carcinoid tumors and acromegaly | 843 | 570 | 1 413 | ||||||
Zolgensma | Neuroscience | Spinal muscular atrophy (SMA) | 469 | 882 | 1 351 | ||||||
Galvus Group | Established Medicines | Type 2 diabetes | 1 092 | 1 092 | |||||||
Ilaris | Immunology, Hepatology and Dermatology | Auto-inflammatory (CAPS, TRAPS, HIDS/MKD, FMF, SJIA, AOSD and gout) | 501 | 558 | 1 059 | ||||||
Gleevec/Glivec | Hematology | Chronic myeloid leukemia and GIST | 263 | 761 | 1 024 | ||||||
Afinitor/Votubia | Solid Tumor | Breast cancer/TSC | 521 | 417 | 938 | ||||||
Kisqali | Solid Tumor | HR+/HER2- metastatic breast cancer | 339 | 598 | 937 | ||||||
Exforge Group | Established Medicines | Hypertension | 14 | 887 | 901 | ||||||
Diovan Group | Established Medicines | Hypertension | 51 | 722 | 773 | ||||||
Kymriah | Hematology | r/r pediatric and young adults ALL, DLBCL | 230 | 357 | 587 | ||||||
Ultibro Group | Respiratory and Allergy | Chronic obstructive pulmonary disease (COPD) | 584 | 584 | |||||||
Top 20 products total | 11 688 | 20 976 | 32 664 | ||||||||
Rest of portfolio | 3 311 | 6 020 | 9 331 | ||||||||
Total division sales | 14 999 | 26 996 | 41 995 | ||||||||
1 Net sales reflect Xolair sales for all indications. |
Brands | Business franchise | Key indication | US USD m | Rest of world USD m | Total USD m | ||||||
Cosentyx | Immunology, Hepatology and Dermatology | Psoriasis, ankylosing spondylitis, psoriatic arthritis and non-radiographic axial spondyloarthritis | 2 516 | 1 479 | 3 995 | ||||||
Gilenya | Neuroscience | Relapsing multiple sclerosis | 1 562 | 1 441 | 3 003 | ||||||
Entresto | Cardiovascular, Renal and Metabolism | Chronic heart failure | 1 277 | 1 220 | 2 497 | ||||||
Tasigna | Hematology | Chronic myeloid leukemia | 859 | 1 099 | 1 958 | ||||||
Lucentis | Ophthalmology | Age-related macular degeneration | 1 933 | 1 933 | |||||||
Promacta/Revolade | Hematology | Immune thrombocytopenia (ITP), severe aplastic anemia (SAA) | 833 | 905 | 1 738 | ||||||
Tafinlar + Mekinist | Solid Tumor | BRAF V600+ metastatic and adjuvant melanoma; advanced non-small cell lung cancer (NSCLC) | 569 | 973 | 1 542 | ||||||
Sandostatin | Solid Tumor | Carcinoid tumors and acromegaly | 837 | 602 | 1 439 | ||||||
Jakavi | Hematology | Myelofibrosis (MF), polycythemia vera (PV) | 1 339 | 1 339 | |||||||
Xolair 1 | Respiratory and Allergy | Severe allergic asthma (SAA) and chronic spontaneous urticaria (CSU) and nasal polyps | 1 251 | 1 251 | |||||||
Galvus Group | Established Medicines | Type 2 diabetes | 1 199 | 1 199 | |||||||
Gleevec/Glivec | Hematology | Chronic myeloid leukemia and GIST | 315 | 873 | 1 188 | ||||||
Afinitor/Votubia | Solid Tumor | Breast cancer/TSC | 644 | 439 | 1 083 | ||||||
Diovan Group | Established Medicines | Hypertension | 124 | 879 | 1 003 | ||||||
Exforge Group | Established Medicines | Hypertension | 16 | 964 | 980 | ||||||
Zolgensma | Neuroscience | Spinal muscular atrophy (SMA) | 459 | 461 | 920 | ||||||
Ilaris | Immunology, Hepatology and Dermatology | Auto-inflammatory (CAPS, TRAPS, HIDS/MKD, FMF, SJIA, AOSD and gout) | 400 | 473 | 873 | ||||||
Kisqali | Solid Tumor | HR+/HER2- metastatic breast cancer | 318 | 369 | 687 | ||||||
Exjade/Jadenu | Hematology | Chronic iron overload | 138 | 515 | 653 | ||||||
Votrient | Solid Tumor | Renal cell carcinoma | 259 | 376 | 635 | ||||||
Top 20 products total | 11 126 | 18 790 | 29 916 | ||||||||
Rest of portfolio | 3 216 | 5 881 | 9 097 | ||||||||
Total division sales | 14 342 | 24 671 | 39 013 | ||||||||
1 Net sales reflect Xolair sales for all indications. |
Brands | Business franchise | Key indication | US USD m | Rest of world USD m | Total USD m | ||||||
Cosentyx | Immunology, Hepatology and Dermatology | Psoriasis, ankylosing spondylitis and psoriatic arthritis | 2 220 | 1 331 | 3 551 | ||||||
Gilenya | Neuroscience | Relapsing multiple sclerosis | 1 736 | 1 487 | 3 223 | ||||||
Lucentis | Ophthalmology | Age-related macular degeneration | 2 086 | 2 086 | |||||||
Tasigna | Hematology | Chronic myeloid leukemia | 804 | 1 076 | 1 880 | ||||||
Entresto | Cardiovascular, Renal and Metabolism | Chronic heart failure | 925 | 801 | 1 726 | ||||||
Sandostatin | Solid Tumor | Carcinoid tumors and acromegaly | 881 | 704 | 1 585 | ||||||
Afinitor/Votubia | Solid Tumor | Breast cancer/TSC | 1 003 | 536 | 1 539 | ||||||
Promacta/Revolade | Hematology | Immune thrombocytopenia (ITP), severe aplastic anemia (SAA) | 691 | 725 | 1 416 | ||||||
Tafinlar + Mekinist | Solid Tumor | BRAF V600+ metastatic and adjuvant melanoma; advanced non-small cell lung cancer (NSCLC) | 481 | 857 | 1 338 | ||||||
Galvus Group | Established Medicines | Type 2 diabetes | 1 297 | 1 297 | |||||||
Gleevec/Glivec | Hematology | Chronic myeloid leukemia and GIST | 334 | 929 | 1 263 | ||||||
Xolair 1 | Respiratory and Allergy | Severe allergic asthma (SAA) and chronic spontaneous urticaria (CSU) | 1 173 | 1 173 | |||||||
Jakavi | Hematology | Myelofibrosis (MF), polycythemia vera (PV) | 1 114 | 1 114 | |||||||
Diovan Group | Established Medicines | Hypertension | 86 | 978 | 1 064 | ||||||
Exforge Group | Established Medicines | Hypertension | 13 | 1 012 | 1 025 | ||||||
Exjade/Jadenu | Hematology | Chronic iron overload | 450 | 525 | 975 | ||||||
Votrient | Solid Tumor | Renal cell carcinoma | 332 | 423 | 755 | ||||||
Ilaris | Immunology, Hepatology and Dermatology | Auto-inflammatory (CAPS, TRAPS, HIDS/MKD, FMF, SJIA, AOSD and gout) | 304 | 367 | 671 | ||||||
Zortress/Certican | Established Medicines | Transplantation | 169 | 316 | 485 | ||||||
Kisqali | Solid Tumor | HR+/HER2- metastatic breast cancer | 250 | 230 | 480 | ||||||
Top 20 products total | 10 679 | 17 967 | 28 646 | ||||||||
Rest of portfolio | 3 110 | 5 958 | 9 068 | ||||||||
Total division sales | 13 789 | 23 925 | 37 714 | ||||||||
1 Net sales reflect Xolair sales for all indications. |
2021 USD m | 2020 USD m | Change (2020 to 2021) USD % | 2019 USD m | Change (2019 to 2020) USD % | |||||||
Retail Generics 1 | 7 092 | 7 244 | -2 | 7 590 | -5 | ||||||
Biopharmaceuticals | 2 116 | 1 928 | 10 | 1 607 | 20 | ||||||
Anti-Infectives 1 | 423 | 474 | -11 | 534 | -11 | ||||||
Total division net sales | 9 631 | 9 646 | 0 | 9 731 | -1 | ||||||
1 Sandoz total anti-infectives net sales amounted to USD 1.1 billion (2020: USD 1.2 billion; 2019: USD 1.3 billion), of which USD 707 million (2020: USD 694 million; 2019: USD 784 million) is sold through the Retail Generics business franchise and USD 423 million (2020: USD 474 million; 2019: USD 534 million) is sold to other third-party companies through the Anti-Infectives business franchise. |
Innovative Medicines | Sandoz | Corporate (including eliminations) | Group | ||||||||||||||||||||||
(USD millions) | 2021 | 2020 | 2019 | 2021 | 2020 | 2019 | 2021 | 2020 | 2019 | 2021 | 2020 | 2019 | |||||||||||||
Profit-sharing income | 873 | 835 | 732 | 2 | 873 | 835 | 734 | ||||||||||||||||||
Royalty income | 74 | 107 | 104 | 24 | 25 | 19 | 11 | 168 | 24 | 109 | 300 | 147 | |||||||||||||
Milestone income | 127 | 39 | 201 | 28 | 11 | 30 | 155 | 50 | 231 | ||||||||||||||||
Other 1 | 105 | 37 | 55 | 9 | 17 | 12 | 114 | 54 | 67 | ||||||||||||||||
Total other revenues | 1 179 | 1 018 | 1 092 | 61 | 53 | 63 | 11 | 168 | 24 | 1 251 | 1 239 | 1 179 | |||||||||||||
1 Other includes revenue from activities such as manufacturing or other services rendered, to the extent such revenue is not recorded under net sales. |
Net income statement effect | Other comprehensive income effect 1 | Total comprehensive income effect | |||||||||||||||||
(USD millions) | 2021 | 2020 | 2019 | 2021 | 2020 | 2019 | 2021 | 2020 | 2019 | ||||||||||
Roche Holding AG, Switzerland | 15 341 | 677 | 662 | 46 | -56 | -94 | 15 387 | 621 | 568 | ||||||||||
Others | -2 | -4 | -3 | -2 | -4 | -3 | |||||||||||||
Associated companies related to continuing operations | 15 339 | 673 | 659 | 46 | -56 | -94 | 15 385 | 617 | 565 | ||||||||||
1 In 2021, Novartis share of other comprehensive income recognized by associated companies, net of taxes of USD 3 million was recycled into the consolidated income statement as a result of the divestment of the investment in Roche Holding AG. NaN Novartis share of other comprehensive income recognized by associated companies was recycled to the consolidated income statement in 2020 and 2019. |
Balance sheet value | |||||
(USD millions) | December 31, 2021 | December 31, 2020 | |||
Roche Holding AG, Switzerland | 9 407 | ||||
Others | 205 | 225 | |||
Total | 205 | 9 632 | |||
(CHF billions) | Current assets | Non-current assets | Current liabilities | Non-current liabilities | |||||
December 31, 2020 | 32.9 | 54.8 | 25.4 | 21.0 | |||||
June 30, 2021 | 31.3 | 57.5 | 25.2 | 21.3 | |||||
(CHF billions) | Revenue | Net income | Other comprehen- sive income | Total comprehen- sive income | |||||
December 31, 2020 | 60.3 | 12.5 | -1.8 | 10.7 | |||||
June 30, 2021 | 32.1 | 7.6 | 1.6 | 9.2 | |||||
(USD millions) | 2021 | 2020 | 2019 | ||||
Novartis share of Roche's estimated current-year consolidated net income | 815 | 913 | 910 | ||||
Prior-year adjustment | 40 | -64 | -129 | ||||
Amortization of fair value adjustments relating to intangible assets, net of taxes of USD 10 million (2020: USD 26 million; 2019: USD 24 million) | -70 | -172 | -162 | ||||
Partial release of deferred tax liability recognized | 43 | ||||||
Gain on divestment of the investment in Roche 1 | 14 556 | ||||||
Net income effect | 15 341 | 677 | 662 | ||||
1 The gain on divestment of the investment in Roche includes the recycling of currency translation effects (see Note 8.1) and other comprehensive income effects totaling USD 3.2 billion. |
(USD millions) | 2021 | 2020 | 2019 | ||||
Interest expense | -651 | -708 | -714 | ||||
Interest expense on lease liabilities | -62 | -67 | -66 | ||||
Expense arising from discounting long-term liabilities and capitalized borrowing costs | -98 | -94 | -70 | ||||
Total interest expense | -811 | -869 | -850 | ||||
(USD millions) | 2021 | 2020 | 2019 | ||||
Interest income | 71 | 91 | 245 | ||||
Other financial income | 12 | 18 | 12 | ||||
Financial expense | -94 | -52 | -52 | ||||
Currency result, net | -69 | -135 | -160 | ||||
Total other financial income and expense | -80 | -78 | 45 | ||||
(USD millions) | 2021 | 2020 | 2019 | ||||
Switzerland 1 | 22 028 | 9 786 | 8 097 | ||||
Foreign | 4 109 | 92 | 843 | ||||
Income before taxes from continuing operations | 26 137 | 9 878 | 8 940 | ||||
1 The 2021 income before taxes in Switzerland includes a USD 14.6 billion non-taxable gain on the divestment of the Group’s investment in Roche Holding AG (see Note 2 and Note 4). |
(USD millions) | 2021 | 2020 | 2019 | ||||
Switzerland | -958 | -932 | -1 186 | ||||
Foreign | -1 470 | -1 168 | -961 | ||||
Current income tax expense | -2 428 | -2 100 | -2 147 | ||||
Switzerland | 23 | -137 | -93 | ||||
Foreign | 286 | 430 | 447 | ||||
Deferred tax income | 309 | 293 | 354 | ||||
Income tax expense from continuing operations | -2 119 | -1 807 | -1 793 | ||||
(As a percentage) | 2021 | 2020 | 2019 | ||||
Applicable tax rate | 14.8 | 13.6 | 11.7 | ||||
Effect of disallowed expenditures | 1.0 | 4.6 | 4.8 | ||||
Effect of utilization of tax losses brought forward from prior periods | 0.0 | -0.3 | -0.1 | ||||
Effect of income taxed at reduced rates | -0.1 | -0.3 | -0.7 | ||||
Effect of income not subject to tax 1 | -7.5 | -0.7 | 0.0 | ||||
Effect of tax credits and allowances | -1.4 | -2.3 | -2.3 | ||||
Effect of release of contingent consideration liability | -0.1 | -0.2 | -0.5 | ||||
Effect of tax rate change on current and deferred tax assets and liabilities 2 | 0.0 | 0.3 | -1.4 | ||||
Effect of write-off of deferred tax assets 3 | 0.0 | 0.2 | 4.0 | ||||
Effect of write-down and reversal of write-down of investments in subsidiaries | 0.0 | -0.8 | -0.6 | ||||
Effect of prior-year items | 0.1 | 2.3 | 2.2 | ||||
Effect of other items 4 | 1.3 | 1.9 | 3.0 | ||||
Effective tax rate for continuing operations | 8.1 | 18.3 | 20.1 | ||||
1 2021 includes the effect of income not subject to tax (-7.3%) arising from the non-taxable gain on the divestment of our investment in Roche. See Notes 2 and 4 for further details. | |||||||
2 2019 is mainly related to the revaluation of the deferred tax assets and liabilities resulting from the tax reforms enacted in Switzerland in 2019. Refer to Note 12 for additional disclosures. | |||||||
3 2019 is primarily related to a non-cash, one-time deferred tax expense for the write-off of a deferred tax asset resulting from legal entity reorganizations. | |||||||
4 In 2021, other items include changes in uncertain tax positions (+1.3%). | |||||||
In 2020, other items (+1.9%) include changes in uncertain tax positions (+2.0%) and other items (-0.1%). | |||||||
In 2019, other items (+3.0%) include changes in uncertain tax positions (+2.6%) and other items (+0.4%). |
2021 | 2020 | 2019 | |||||
Net income attributable to shareholders of Novartis AG (USD millions) | |||||||
- Continuing operations | 24 021 | 8 072 | 7 142 | ||||
- Discontinued operations | 4 590 | ||||||
Total | 24 021 | 8 072 | 11 732 | ||||
Number of shares (in millions) | |||||||
Weighted average number of shares outstanding used in basic earnings per share | 2 243 | 2 277 | 2 291 | ||||
Adjustment for vesting of restricted shares, restricted share units and dilutive shares from options | 17 | 19 | 28 | ||||
Weighted average number of shares in diluted earnings per share | 2 260 | 2 296 | 2 319 | ||||
Basic earnings per share (USD) | |||||||
- Continuing operations | 10.71 | 3.55 | 3.12 | ||||
- Discontinued operations | 2.00 | ||||||
Total | 10.71 | 3.55 | 5.12 | ||||
Diluted earnings per share (USD) | |||||||
- Continuing operations | 10.63 | 3.52 | 3.08 | ||||
- Discontinued operations | 1.98 | ||||||
Total | 10.63 | 3.52 | 5.06 | ||||
(USD millions) | Note | Fair value adjustments on financial instruments | Actuarial gains/(losses) from defined benefit plans | Cumulative currency translation effects | Total value adjustments attributable to Novartis AG shareholders | Non- controlling interest | Total value adjustments | ||||||||
Value adjustments at December 31, 2018 | 227 | -5 423 | 744 | -4 452 | -26 | -4 478 | |||||||||
Fair value adjustments on deferred cash flow hedges | 1 | 1 | 1 | ||||||||||||
Fair value adjustments on debt securities | 1 | 1 | 1 | ||||||||||||
Fair value adjustments on equity securities, net of taxes of USD 47 million 1 | -47 | -47 | -47 | ||||||||||||
Net investment hedge | 44 | 44 | 44 | ||||||||||||
Defined benefit plans, net of taxes of USD -313 million 2 | -466 | -466 | -1 | -467 | |||||||||||
Currency translation effects, net of taxes of USD 2 million | 8.1 | 354 | 354 | -2 | 352 | ||||||||||
Total value adjustments in 2019 | -45 | -466 | 398 | -113 | -3 | -116 | |||||||||
Fair value adjustments on equity securities sold, reclassified to retained earnings | -95 | -95 | -95 | ||||||||||||
Fair value adjustments related to divestments | 33 | -30 | 3 | 3 | |||||||||||
Value adjustments at December 31, 2019 | 120 | -5 919 | 1 142 | -4 657 | -29 | -4 686 | |||||||||
Fair value adjustments on equity securities, net of taxes of USD -36 million 1 | 250 | 250 | 250 | ||||||||||||
Net investment hedge | -201 | -201 | -201 | ||||||||||||
Defined benefit plans, net of taxes of USD -3 million | 145 | 145 | -2 | 143 | |||||||||||
Currency translation effects, net of taxes of USD 10 million | 8.1 | 3 193 | 3 193 | 1 | 3 194 | ||||||||||
Total value adjustments in 2020 | 250 | 145 | 2 992 | 3 387 | -1 | 3 386 | |||||||||
Fair value adjustments on equity securities sold, reclassified to retained earnings | -150 | -150 | -150 | ||||||||||||
Fair value adjustments related to divestments | 2 | 2 | 2 | ||||||||||||
Impact of change in ownership of consolidated entities | -1 | -1 | 1 | ||||||||||||
Value adjustments at December 31, 2020 | 220 | -5 773 | 4 134 | -1 419 | -29 | -1 448 | |||||||||
Fair value adjustments on equity securities, net of taxes of USD -44 million 1 | 194 | 194 | 194 | ||||||||||||
Net investment hedge, net of taxes of USD 33 million | 216 | 216 | 216 | ||||||||||||
Defined benefit plans, net of taxes of USD -323 million | 1 808 | 1 808 | 1 | 1 809 | |||||||||||
Currency translation effects, net of taxes of USD 17 million | 8.1 | -4 757 | -4 757 | -5 | -4 762 | ||||||||||
Total value adjustments in 2021 | 194 | 1 808 | -4 541 | -2 539 | -4 | -2 543 | |||||||||
Fair value adjustments on equity securities sold, reclassified to retained earnings net of taxes of USD 48 million | -164 | -164 | -164 | ||||||||||||
Fair value adjustments related to divestments | -62 | -3 | -65 | -65 | |||||||||||
Value adjustments at December 31, 2021 | 188 | -3 968 | -407 | -4 187 | -33 | -4 220 | |||||||||
1 Includes fair value adjustments on equity securities designated as financial assets valued at fair value through other comprehensive income with no subsequent recycling into the consolidated income statement | |||||||||||||||
2 Included in 2019 is a USD -358 million impact related to the revaluation of deferred tax assets on Swiss post-employment benefits that were previously recognized through other comprehensive income. This revaluation resulted from the Swiss tax reforms enacted by the voters in 2019. Refer to Note 12 for additional disclosures. |
(USD millions) | Land | Buildings | Construction in progress | Machinery and other equipment | Total | ||||||
Cost | |||||||||||
January 1, 2021 | 555 | 12 377 | 1 248 | 14 038 | 28 218 | ||||||
Reclassifications | 197 | -610 | 413 | ||||||||
Additions | 1 | 109 | 1 027 | 293 | 1 430 | ||||||
Disposals and derecognitions | -40 | -437 | -70 | -699 | -1 246 | ||||||
Currency translation effects | -24 | -427 | -87 | -717 | -1 255 | ||||||
December 31, 2021 | 492 | 11 819 | 1 508 | 13 328 | 27 147 | ||||||
Accumulated depreciation | |||||||||||
January 1, 2021 | -19 | -5 807 | -66 | -10 063 | -15 955 | ||||||
Accumulated depreciation on disposals and derecognitions | 10 | 359 | 58 | 669 | 1 096 | ||||||
Depreciation charge | -453 | -755 | -1 208 | ||||||||
Impairment charge | -4 | -137 | -76 | -167 | -384 | ||||||
Reversal of impairment charge | 5 | 70 | 16 | 12 | 103 | ||||||
Currency translation effects | 1 | 224 | 3 | 518 | 746 | ||||||
December 31, 2021 | -7 | -5 744 | -65 | -9 786 | -15 602 | ||||||
Net book value at December 31, 2021 | 485 | 6 075 | 1 443 | 3 542 | 11 545 | ||||||
Commitments for purchases of property, plant and equipment | 204 | ||||||||||
Capitalized borrowing costs | 4 | ||||||||||
(USD millions) | Land | Buildings | Construction in progress | Machinery and other equipment | Total | ||||||
Cost | |||||||||||
January 1, 2020 | 512 | 11 463 | 1 350 | 13 674 | 26 999 | ||||||
Cost of assets related to disposal group held for sale 1 | 11 | 117 | 36 | 168 | 332 | ||||||
Impact of acquisitions of businesses | 2 | 19 | 5 | 26 | |||||||
Reclassifications | 10 | 433 | -1 038 | 595 | |||||||
Additions | 7 | 115 | 847 | 296 | 1 265 | ||||||
Disposals and derecognitions | -23 | -465 | -57 | -1 656 | -2 201 | ||||||
Currency translation effects | 36 | 695 | 110 | 956 | 1 797 | ||||||
December 31, 2020 | 555 | 12 377 | 1 248 | 14 038 | 28 218 | ||||||
Accumulated depreciation | |||||||||||
January 1, 2020 | -20 | -5 124 | -60 | -9 726 | -14 930 | ||||||
Accumulated depreciation on assets related to disposal group held for sale 1 | -58 | -4 | -101 | -163 | |||||||
Accumulated depreciation on disposals and derecognitions | 17 | 433 | 11 | 1 543 | 2 004 | ||||||
Depreciation charge 2 | -491 | -827 | -1 318 | ||||||||
Impairment charge | -15 | -194 | -10 | -228 | -447 | ||||||
Reversal of impairment charge | 7 | 7 | |||||||||
Currency translation effects | -1 | -373 | -3 | -731 | -1 108 | ||||||
December 31, 2020 | -19 | -5 807 | -66 | -10 063 | -15 955 | ||||||
Net book value at December 31, 2020 | 536 | 6 570 | 1 182 | 3 975 | 12 263 | ||||||
Commitments for purchases of property, plant and equipment | 256 | ||||||||||
Capitalized borrowing costs | 2 | ||||||||||
1 At March 31, 2020, the property, plant and equipment of the Sandoz US generic oral solids and dermatology businesses were reclassified out of assets of disposal group held for sale. See Note 2 for further details. | |||||||||||
2 Depreciation charge includes USD 38 million (USD 20 million for buildings and USD 18 million for machinery and other equipment), representing the cumulative amount of depreciation charge on the disposal group held for sale for property, plant and equipment from the date of classification to held for sale, September 2018, to March 31, 2020, the date of reclassification out of assets of disposal group held for sale. See Note 2 for further details. | |||||||||||
Impairment charges | Impairment reversals | ||||||||||||
(USD millions) | 2021 | 2020 | 2019 | 2021 | 2020 | 2019 | |||||||
Innovative Medicines | -315 | -326 | -102 | 44 | 2 | 2 | |||||||
Sandoz | -68 | -121 | -102 | 59 | 5 | 1 | |||||||
Corporate | -1 | -1 | |||||||||||
Total | -384 | -447 | -205 | 103 | 7 | 3 | |||||||
(USD millions) | 2021 | 2020 | |||
Right-of-use assets at January 1 | 1 676 | 1 677 | |||
Impact of acquisitions of businesses | 32 | ||||
Additions | 321 | 346 | |||
Depreciation charge | -318 | -330 | |||
Lease contract terminations 1 | -66 | -63 | |||
Impact of divestments | -32 | ||||
Currency translation effects | -52 | 46 | |||
Total right-of-use assets at December 31 2 | 1 561 | 1 676 | |||
1 Lease contract terminations also includes modifications to existing leases that result in reductions to the right-of-use assets, and reductions due to sub-leasing. | |||||
2 NaN impairment charge was recorded in 2021 (2020: NaN). |
(USD millions) | December 31, 2021 carrying value | Depreciation charge 2021 | December 31, 2020 carrying value | Depreciation charge 2020 | |||||
Land | 522 | 11 | 528 | 11 | |||||
Buildings | 866 | 192 | 963 | 207 | |||||
Vehicles | 136 | 105 | 155 | 100 | |||||
Machinery and equipment, and other assets | 37 | 10 | 30 | 12 | |||||
Total right-of-use assets | 1 561 | 318 | 1 676 | 330 | |||||
(USD millions) | Lease liabilities 2021 | Lease liabilities undiscounted 2021 | Lease liabilities 2020 | Lease liabilities undiscounted 2020 | ||||
Less than one year | 275 | 324 | 286 | 338 | ||||
Between one and two years | 216 | 258 | 229 | 274 | ||||
Between two and three years | 162 | 198 | 186 | 226 | ||||
Between three and four years | 139 | 172 | 148 | 183 | ||||
Between four and five years | 122 | 154 | 129 | 160 | ||||
After five years | 982 | 2 243 | 1 027 | 2 326 | ||||
Total lease liabilities | 1 896 | 3 349 | 2 005 | 3 507 | ||||
Less current portion of lease liabilities | -275 | -324 | -286 | -338 | ||||
Non-current portion of lease liabilities | 1 621 | 3 025 | 1 719 | 3 169 | ||||
Commitments for leases not yet commenced | 134 | 4 | ||||||
(USD millions) | 2021 | 2020 | 2019 | ||||
Interest expense on lease liabilities 1 | 62 | 67 | 66 | ||||
Expense on short-term leases | 6 | 4 | 7 | ||||
Expense on low-value leases | 7 | 7 | 8 | ||||
Total cash outflows for leases | 381 | 379 | 339 | ||||
Thereof: | |||||||
Cash outflows for short-term leases and low-value leases 2 | 13 | 11 | 15 | ||||
Payments of interest 3 | 52 | 56 | 51 | ||||
Payments of lease liabilities 4 | 316 | 312 | 273 | ||||
1 The weighted average interest rate is 3.2% (2020: 3.4%, 2019: 3.9%). | |||||||
2 Cash flows from short-term and low-value leases are included within total net cash flows from operating activities. The portfolio of short-term leases to which the Group is committed to at December 31, 2021, 2020 and 2019, is similar to the portfolio of short-term leases the Group entered into during 2021, 2020 and 2019. | |||||||
3 Included within total net cash flows from operating activities | |||||||
4 Reported as cash outflows used in financing activities net of lease incentives received of USD NaN (2020: NaN, 2019: USD 33 million) |
Goodwill | Intangible assets other than goodwill | ||||||||||||
(USD millions) | Total | In-process research and development | Technologies | Currently marketed products | Other intangible assets | Total | |||||||
Cost | |||||||||||||
January 1, 2021 | 30 321 | 6 893 | 1 115 | 57 333 | 2 384 | 67 725 | |||||||
Impact of acquisitions of businesses | 238 | 262 | 292 | 98 | 652 | ||||||||
Reclassifications 1 | -20 | 15 | 5 | ||||||||||
Additions | 958 | 270 | 508 | 1 736 | |||||||||
Disposals and derecognitions 2 | -433 | -22 | -455 | ||||||||||
Currency translation effects | -659 | -80 | -50 | -1 254 | -63 | -1 447 | |||||||
December 31, 2021 | 29 900 | 8 013 | 1 080 | 56 213 | 2 905 | 68 211 | |||||||
Accumulated amortization | |||||||||||||
January 1, 2021 | -322 | -2 193 | -885 | -26 566 | -1 272 | -30 916 | |||||||
Amortization charge | -41 | -3 607 | -255 | -3 903 | |||||||||
Accumulated amortization on disposals and derecognitions 2 | 397 | 21 | 418 | ||||||||||
Impairment charge | -350 | -17 | -1 | -35 | -403 | ||||||||
Currency translation effects | 17 | 29 | 40 | 670 | 36 | 775 | |||||||
December 31, 2021 | -305 | -2 514 | -903 | -29 107 | -1 505 | -34 029 | |||||||
Net book value at December 31, 2021 | 29 595 | 5 499 | 177 | 27 106 | 1 400 | 34 182 | |||||||
1 Reclassifications between various asset categories as a result of product launches of acquired in-process research and development and completion of software development | |||||||||||||
2 Derecognition of assets that are no longer being used or developed and are not considered to have a significant disposal value or other alternative use |
Goodwill | Intangible assets other than goodwill | ||||||||||||
(USD millions) | Total | In-process research and development | Technologies | Currently marketed products | Other intangible assets | Total | |||||||
Cost | |||||||||||||
January 1, 2020 | 26 825 | 7 429 | 884 | 43 548 | 1 558 | 53 419 | |||||||
Cost of assets reclassified out of assets of disposal group held for sale 1 | 10 | 276 | 1 112 | 2 | 1 400 | ||||||||
Impact of acquisitions of businesses | 2 580 | 8 600 | 196 | 218 | 9 014 | ||||||||
Reclassifications 2 | -9 272 | -2 | 9 274 | ||||||||||
Additions 3 | 339 | 674 | 412 | 1 425 | |||||||||
Disposals and derecognitions 4 | -421 | -101 | -39 | -11 | -572 | ||||||||
Currency translation effects | 916 | 208 | 58 | 2 568 | 205 | 3 039 | |||||||
December 31, 2020 | 30 321 | 6 893 | 1 115 | 57 333 | 2 384 | 67 725 | |||||||
Accumulated amortization | |||||||||||||
January 1, 2020 | -301 | -2 005 | -721 | -20 969 | -937 | -24 632 | |||||||
Accumulated amortization on assets reclassified out of assets of disposal group held for sale 1 | -2 | -107 | -816 | -925 | |||||||||
Amortization charge 5 | -72 | -3 215 | -175 | -3 462 | |||||||||
Accumulated amortization on disposals and derecognitions 4 | 421 | 101 | 39 | 6 | 567 | ||||||||
Impairment charge 6 | -515 | -40 | -338 | -21 | -914 | ||||||||
Currency translation effects | -21 | -92 | -46 | -1 267 | -145 | -1 550 | |||||||
December 31, 2020 | -322 | -2 193 | -885 | -26 566 | -1 272 | -30 916 | |||||||
Net book value at December 31, 2020 | 29 999 | 4 700 | 230 | 30 767 | 1 112 | 36 809 | |||||||
1 At March 31, 2020, intangible assets of the Sandoz US generic oral solids and dermatology businesses were reclassified out of assets of disposal group held for sale. See Note 2 for further details. | |||||||||||||
2 Reclassifications between various asset categories as a result of product launches of acquired in-process research and development and completion of software development | |||||||||||||
3 NaN addition for the disposal group held for sale for the period from January 1, 2020, to March 31, 2020 | |||||||||||||
4 Derecognition of assets that are no longer being used or developed and are not considered to have a significant disposal value or other alternative use | |||||||||||||
5 Amortization charge includes USD 102 million (USD 73 million for currently marketed products and USD 29 million for technologies), representing the cumulative amount of amortization charge for the disposal group held for sale for intangible assets from the date of reclassification to held for sale, September 6, 2018, to March 31, 2020, the date of reclassification out of assets of disposal group held for sale. See Note 2 for further details. | |||||||||||||
6 Impairment charge includes USD 42 million on currently marketed products that were previously classified within assets of disposal group held for sale. See Note 2 for further details. |
Goodwill | Intangible assets other than goodwill | ||||||||||||
(USD millions) | Total | In-process research and development | Technologies | Currently marketed products | Other intangible assets | Total | |||||||
Innovative Medicines | 21 562 | 5 313 | 15 | 25 938 | 1 091 | 32 357 | |||||||
Sandoz | 8 026 | 186 | 162 | 1 168 | 61 | 1 577 | |||||||
Corporate | 7 | 248 | 248 | ||||||||||
Net book value at December 31, 2021 | 29 595 | 5 499 | 177 | 27 106 | 1 400 | 34 182 | |||||||
Goodwill | Intangible assets other than goodwill | ||||||||||||
(USD millions) | Total | In-process research and development | Technologies | Currently marketed products | Other intangible assets | Total | |||||||
Innovative Medicines | 21 718 | 4 548 | 3 | 29 645 | 925 | 35 121 | |||||||
Sandoz | 8 274 | 152 | 227 | 1 122 | 42 | 1 543 | |||||||
Corporate | 7 | 145 | 145 | ||||||||||
Net book value at December 31, 2020 | 29 999 | 4 700 | 230 | 30 767 | 1 112 | 36 809 | |||||||
(As a percentage) | Innovative Medicines | Sandoz | |||
Terminal growth rate | 1.5 | 1.5 | |||
Discount rate (post-tax) | 6.5 | 6.5 | |||
Impairment charges | Impairment reversals | ||||||||||||
(USD millions) | 2021 | 2020 | 2019 | 2021 | 2020 | 2019 | |||||||
Innovative Medicines 1 | -367 | -768 | -669 | 37 | |||||||||
Sandoz 2 | -28 | -141 | -506 | ||||||||||
Corporate | -8 | -5 | |||||||||||
Total | -403 | -914 | -1 175 | 37 | |||||||||
1 2021 includes an impairment of USD 201 million related to the write-down of IPR&D related to cessation of clinical development program GTX312. | |||||||||||||
2020 includes an impairment of USD 485 million related to the write-down of IPR&D related to cessation of clinical development program ZPL389 for atopic dermatitis and USD 181 million related to a partial write-down of the Votrient currently marketed product. | |||||||||||||
2019 includes an impairment of USD 416 million related to the write-down of IPR&D related to cessation of clinical development program EMA401 and a USD 108 million write-down related to the cessation of clinical development program for MOR106 for atopic dermatitis. | |||||||||||||
2 2019 includes an impairment of USD 442 million related to the write-down of IPR&D related to the discontinuation of the generic Advair® development program. |
(USD millions) | Property, plant and equipment | Intangible assets | Pensions and other benefit obligations of employees | Inventories | Tax loss carry- forwards | Other assets, provisions and accruals | Total | ||||||||
Gross deferred tax assets at January 1, 2021 | 189 | 1 351 | 1 137 | 2 502 | 507 | 2 658 | 8 344 | ||||||||
Gross deferred tax liabilities at January 1, 2021 | -430 | -5 269 | -340 | -159 | -10 | -1 344 | -7 552 | ||||||||
Net deferred tax balance at January 1, 2021 | -241 | -3 918 | 797 | 2 343 | 497 | 1 314 | 792 | ||||||||
At January 1, 2021 | -241 | -3 918 | 797 | 2 343 | 497 | 1 314 | 792 | ||||||||
Credited/(charged) to income | -27 | 567 | -22 | -215 | -121 | 127 | 309 | ||||||||
Charged to equity | -35 | -35 | |||||||||||||
Credited/(charged) to other comprehensive income | -323 | 6 | -317 | ||||||||||||
Impact of acquisitions of businesses | -58 | 12 | -46 | ||||||||||||
Other movements | 12 | 12 | -17 | -3 | -14 | -20 | -30 | ||||||||
Net deferred tax balance at December 31, 2021 | -256 | -3 397 | 435 | 2 125 | 374 | 1 392 | 673 | ||||||||
Gross deferred tax assets at December 31, 2021 | 125 | 1 307 | 1 026 | 2 273 | 374 | 2 727 | 7 832 | ||||||||
Gross deferred tax liabilities at December 31, 2021 | -381 | -4 704 | -591 | -148 | -1 335 | -7 159 | |||||||||
Net deferred tax balance at December 31, 2021 | -256 | -3 397 | 435 | 2 125 | 374 | 1 392 | 673 | ||||||||
After offsetting the following amount of deferred tax assets and liabilities within the same tax jurisdiction, the balance amounts to: | 4 089 | ||||||||||||||
Deferred tax assets at December 31, 2021 | 3 743 | ||||||||||||||
Deferred tax liabilities at December 31, 2021 | -3 070 | ||||||||||||||
Net deferred tax balance at December 31, 2021 | 673 | ||||||||||||||
Gross deferred tax assets at January 1, 2020 | 108 | 1 469 | 1 078 | 2 446 | 255 | 2 596 | 7 952 | ||||||||
Gross deferred tax liabilities at January 1, 2020 | -390 | -3 610 | -291 | -287 | -7 | -1 325 | -5 910 | ||||||||
Net deferred tax balance at January 1, 2020 | -282 | -2 141 | 787 | 2 159 | 248 | 1 271 | 2 042 | ||||||||
At January 1, 2020 | -282 | -2 141 | 787 | 2 159 | 248 | 1 271 | 2 042 | ||||||||
Credited/(charged) to income | 89 | 110 | -25 | 212 | -164 | 71 | 293 | ||||||||
Charged to equity | 9 | 9 | |||||||||||||
Charged to other comprehensive income | -3 | -36 | -39 | ||||||||||||
Impact of acquisitions of businesses | 5 | -1 945 | -3 | 408 | 34 | -1 501 | |||||||||
Other movements | -53 | 58 | 38 | -25 | 5 | -35 | -12 | ||||||||
Net deferred tax balance at December 31, 2020 | -241 | -3 918 | 797 | 2 343 | 497 | 1 314 | 792 | ||||||||
Gross deferred tax assets at December 31, 2020 | 189 | 1 351 | 1 137 | 2 502 | 507 | 2 658 | 8 344 | ||||||||
Gross deferred tax liabilities at December 31, 2020 | -430 | -5 269 | -340 | -159 | -10 | -1 344 | -7 552 | ||||||||
Net deferred tax balance at December 31, 2020 | -241 | -3 918 | 797 | 2 343 | 497 | 1 314 | 792 | ||||||||
After offsetting the following amount of deferred tax assets and liabilities within the same tax jurisdiction, the balance amounts to: 1 | 4 411 | ||||||||||||||
Deferred tax assets at December 31, 2020 | 3 933 | ||||||||||||||
Deferred tax liabilities at December 31, 2020 | -3 141 | ||||||||||||||
Net deferred tax balance at December 31, 2020 | 792 | ||||||||||||||
1 The December 31, 2020 offsetting amount and deferred tax assets and deferred tax liabilities after offsetting the deferred tax assets and liabilities within the same tax jurisdiction have been adjusted from the previously reported amounts, due to a change in the presentation of the deferred tax assets and deferred tax liabilities on the consolidated balance sheet, to conform with the 2021 presentation. The net deferred tax balance at December 31, 2020 did not require adjustment (see the paragraphs below in this Note 12 for additional disclosures). | |||||||||||||||
(USD millions) | Not capitalized | Capitalized | 2021 total | ||||
One year | 15 | 4 | 19 | ||||
Two years | 14 | 6 | 20 | ||||
Three years | 37 | 10 | 47 | ||||
Four years | 26 | 11 | 37 | ||||
Five years | 146 | 20 | 166 | ||||
More than five years | 3 536 | 1 872 | 5 408 | ||||
Not subject to expiry | 418 | 684 | 1 102 | ||||
Total | 4 192 | 2 607 | 6 799 | ||||
(USD millions) | Not capitalized | Capitalized | 2020 total | ||||
One year | 20 | 20 | |||||
Two years | 1 | 5 | 6 | ||||
Three years | 2 | 6 | 8 | ||||
Four years | 23 | 23 | |||||
Five years | 11 | 40 | 51 | ||||
More than five years 1 | 3 400 | 2 291 | 5 691 | ||||
Not subject to expiry | 323 | 683 | 1 006 | ||||
Total | 3 780 | 3 025 | 6 805 | ||||
1 Not capitalized more than five years includes USD 3.2 billion attributable to US state tax-loss carry-forwards, of which USD 1.6 billion relates to The Medicines Company, which was acquired in 2020 (see Note 2). |
(USD millions) | 2021 | 2020 | 2019 | ||||
Tax losses carried forward that expired | 18 | 14 | 9 | ||||
(USD millions) | Income statement continuing operations | Equity | Total | ||||
Deferred tax asset and liability revaluation | |||||||
Items previously recognized in consolidated income statement | 234 | 234 | |||||
Items previously recognized in other comprehensive income 1 | -358 | -358 | |||||
Total revaluation of deferred tax assets and liabilities | 234 | -358 | -124 | ||||
1 Related to post-employment benefits |
(USD millions) | 2021 | 2020 | |||
Equity securities | 1 663 | 1 577 | |||
Debt securities | 34 | 36 | |||
Fund investments | 366 | 366 | |||
Total financial investments | 2 063 | 1 979 | |||
Long-term receivables from finance subleases | 70 | 83 | |||
Other long-term receivables | 184 | 125 | |||
Contingent consideration receivables 1 | 641 | 625 | |||
Long-term loans, advances and security deposits | 78 | 89 | |||
Total financial assets | 3 036 | 2 901 | |||
1 Note 29 provides additional disclosures related to contingent considerations. |
(USD millions) | 2021 | 2020 | |||
Deferred compensation plans | 520 | 471 | |||
Prepaid post-employment benefit plans | 1 415 | 202 | |||
Other non-current assets | 275 | 219 | |||
Total other non-current assets | 2 210 | 892 | |||
(USD millions) | 2021 | 2020 | |||
Raw material, consumables | 870 | 967 | |||
Work in progress | 3 160 | 3 324 | |||
Finished products | 2 636 | 2 840 | |||
Total inventories | 6 666 | 7 131 | |||
(USD billions) | 2021 | 2020 | 2019 | ||||
Cost of goods sold | -8.8 | -8.5 | -8.5 | ||||
(USD millions) | 2021 | 2020 | 2019 | ||||
Inventory provisions | -573 | -702 | -752 | ||||
Reversals of inventory provisions | 158 | 255 | 218 | ||||
(USD millions) | 2021 | 2020 | |||
Total gross trade receivables | 8 088 | 8 310 | |||
Provisions for doubtful trade receivables | -83 | -93 | |||
Total trade receivables, net | 8 005 | 8 217 | |||
(USD millions) | 2021 | 2020 | 2019 | ||||
January 1 | -93 | -95 | -126 | ||||
Provisions related to discontinued operations 1 | 54 | ||||||
Provisions for doubtful trade receivables charged to the consolidated income statement | -39 | -59 | -89 | ||||
Utilization of provisions for doubtful trade receivables | 9 | 13 | 12 | ||||
Reversal of provisions for doubtful trade receivables credited to the consolidated income statement | 34 | 53 | 53 | ||||
Currency translation effects | 6 | -5 | 1 | ||||
December 31 | -83 | -93 | -95 | ||||
1 Notes 1, 2 and 30 provide information related to discontinued operations. |
(USD millions) | 2021 | 2020 | |||
Not overdue | 7 639 | 7 714 | |||
Past due for not more than one month | 162 | 150 | |||
Past due for more than one month but less than three months | 99 | 118 | |||
Past due for more than three months but less than six months | 63 | 102 | |||
Past due for more than six months but less than one year | 28 | 77 | |||
Past due for more than one year | 97 | 149 | |||
Provisions for doubtful trade receivables | -83 | -93 | |||
Total trade receivables, net | 8 005 | 8 217 | |||
(USD millions) | 2021 | 2020 | |||
Total balance of gross trade receivables from closely monitored countries | 1 336 | 1 505 | |||
Past due for more than one year | 27 | 55 | |||
Provisions for doubtful trade receivables | 24 | 27 | |||
(USD millions) | 2021 | 2020 | |||
US dollar (USD) | 3 344 | 3 311 | |||
Euro (EUR) | 1 408 | 1 668 | |||
Russian ruble (RUB) | 473 | 288 | |||
Japanese yen (JPY) | 383 | 437 | |||
British pound (GBP) | 200 | 191 | |||
Chinese yuan (CNY) | 197 | 208 | |||
Australian dollar (AUD) | 139 | 153 | |||
Canadian dollar (CAD) | 139 | 125 | |||
Brazilian real (BRL) | 129 | 148 | |||
Swiss franc (CHF) | 106 | 124 | |||
Other currencies | 1 487 | 1 564 | |||
Total trade receivables, net | 8 005 | 8 217 | |||
(USD millions) | 2021 | 2020 | |||
Commodities | 111 | 111 | |||
Debt securities | 2 741 | 26 | |||
Time deposits and short-term investments with original maturity more than 90 days | 12 965 | 1 609 | |||
Derivative financial instruments | 105 | 159 | |||
Total marketable securities, commodities, time deposits and derivative financial instruments | 15 922 | 1 905 | |||
(USD millions) | 2021 | 2020 | |||
Current accounts | 3 396 | 3 750 | |||
Time deposits and short-term investments with original maturity less than 90 days | 9 011 | 5 908 | |||
Total cash and cash equivalents | 12 407 | 9 658 | |||
(USD millions) | 2021 | 2020 | |||
VAT receivable | 487 | 544 | |||
Withholding tax recoverable | 58 | 73 | |||
Prepaid expenses | 1 102 | 943 | |||
Other receivables and current assets | 793 | 963 | |||
Total other current assets | 2 440 | 2 523 | |||
(USD millions) | Jan 1, 2019 | Movement in year | Dec 31, 2019 | Movement in year | Dec 31, 2020 | Movement in year | Dec 31, 2021 | ||||||||
Share capital | 944 | -8 | 936 | -23 | 913 | -12 | 901 | ||||||||
Treasury shares | -69 | -11 | -80 | 27 | -53 | 5 | -48 | ||||||||
Outstanding share capital | 875 | -19 | 856 | 4 | 860 | -7 | 853 | ||||||||
2021 | 2020 | 2019 | |||||||||||||||||||
Number of outstanding shares (in millions) | Note | Total Novartis shares | Total treasury shares1 | Total outstanding shares | Total Novartis shares | Total treasury shares1 | Total outstanding shares | Total Novartis shares | Total treasury shares1 | Total outstanding shares | |||||||||||
Balance at beginning of year | 2 467.0 | -210.2 | 2 256.8 | 2 527.3 | -262.3 | 2 265.0 | 2 550.6 | -239.4 | 2 311.2 | ||||||||||||
Shares canceled for capital reduction 2 | -32.6 | 32.6 | -60.3 | 60.3 | -23.3 | 23.3 | |||||||||||||||
Shares acquired to be canceled 3 | -30.7 | -30.7 | -32.6 | -32.6 | -60.3 | -60.3 | |||||||||||||||
Other share purchases 4 | -1.5 | -1.5 | -1.7 | -1.7 | -1.7 | -1.7 | |||||||||||||||
Exercise of options and employee transactions 5 | 18.9 | 0.6 | 0.6 | 14.7 | 14.7 | 5.5 | 5.5 | ||||||||||||||
Equity-based compensation 5 | 9.6 | 9.6 | 11.0 | 11.0 | 9.4 | 9.4 | |||||||||||||||
Shares delivered to Alcon employees | 0.1 | 0.1 | 0.4 | 0.4 | 0.9 | 0.9 | |||||||||||||||
Total movements | -32.6 | 10.7 | -21.9 | -60.3 | 52.1 | -8.2 | -23.3 | -22.9 | -46.2 | ||||||||||||
Balance at end of year | 2 434.4 | -199.5 | 2 234.9 | 2 467.0 | -210.2 | 2 256.8 | 2 527.3 | -262.3 | 2 265.0 | ||||||||||||
1 Approximately 102.5 million treasury shares (2020: 103.0 million; 2019: 117.6 million) are held in Novartis entities that restrict their availability for use. | |||||||||||||||||||||
2 Novartis reduced its share capital by canceling shares that were repurchased on the SIX Swiss Exchange second trading line during previous years. | |||||||||||||||||||||
3 Shares repurchased on the SIX Swiss Exchange second trading line under a CHF 10 billion share buyback authority approved at the 2016 Annual General Meeting (AGM) for transactions before February 28, 2019, under a CHF 10 billion share buyback authority approved at the 2019 AGM for transactions after February 28, 2019 until March 2, 2021, and under a new CHF 10 billion share buyback authority approved at the 2021 AGM for transactions after March 2, 2021 | |||||||||||||||||||||
4 Shares acquired from employees, which were previously granted to them under the respective equity-based participation plans | |||||||||||||||||||||
5 Shares delivered as a result of options being exercised and physical share deliveries related to equity-based participation plans | |||||||||||||||||||||
2021 | 2020 | 2019 | |||||
Dividend per share (in CHF) | 3.00 | 2.95 | 2.85 | ||||
Total dividend payment (in USD billion) | 7.4 | 7.0 | 6.6 | ||||
2021 | 2020 | 2019 | |||||||||||||
Note | Number of outstanding shares (in millions) | Equity impact USD m | Number of outstanding shares (in millions) | Equity impact USD m | Number of outstanding shares (in millions) | Equity impact USD m | |||||||||
Shares acquired to be canceled 1 | -30.7 | -2 775 | -32.6 | -2 897 | -60.3 | -5 351 | |||||||||
Other share purchases 2 | -1.5 | -145 | -1.7 | -159 | -1.7 | -160 | |||||||||
Purchase of treasury shares | -32.2 | -2 920 | -34.3 | -3 056 | -62.0 | -5 511 | |||||||||
Exercise of options and employee transactions 3 | 18.9 | 0.6 | 39 | 14.7 | 806 | 5.5 | 210 | ||||||||
Equity-based compensation 4 | 9.6 | 745 | 11.0 | 730 | 9.4 | 833 | |||||||||
Shares delivered to Alcon employees | 0.1 | 17 | 0.4 | 30 | 0.9 | 18 | |||||||||
Total | -21.9 | -2 119 | -8.2 | -1 490 | -46.2 | -4 450 | |||||||||
1 Shares repurchased on the SIX Swiss Exchange second trading line under a CHF 10 billion share buyback authority approved at the 2016 AGM for transactions before February 28, 2019, under a CHF 10 billion share buyback authority approved at the 2019 AGM for transactions after February 28, 2019 until March 2, 2021, and under a new CHF 10 billion share buyback authority approved at the 2021 AGM for transactions after March 2, 2021 | |||||||||||||||
2 Shares acquired from employees, which were previously granted to them under the respective equity-based participation plans | |||||||||||||||
3 Shares delivered as a result of options being exercised related to equity-based participation plans and the delivery of treasury shares. The average share price of the shares delivered was significantly below market price, reflecting the strike price of the options exercised. | |||||||||||||||
4 Equity-settled share-based compensation is expensed in the consolidated income statement in accordance with the vesting period of the share-based compensation plans. The value for the shares and options granted is credited to consolidated equity over the respective vesting period. In addition, tax benefits arising from tax-deductible amounts exceeding the expense recognized in the income statement are credited to equity. | |||||||||||||||
(USD millions) | 2021 | 2020 | |||
Straight bonds | 25 296 | 28 298 | |||
Liabilities to banks and other financial institutions 1 | 227 | 233 | |||
Total, including current portion of non-current financial debt | 25 523 | 28 531 | |||
Less current portion of non-current financial debt | -2 621 | -2 272 | |||
Total non-current financial debt | 22 902 | 26 259 | |||
1 Average interest rate 0.9% (2020: 0.3%) |
Coupon | Currency | Nominal amount (millions) | Issuance year | Maturity year | Issuer | Issue price | 2021 (USD millions) | 2020 (USD millions) | |||||||||
2.400% | USD | 1 500 | 2012 | 2022 | Novartis Capital Corporation, New York, United States | 99.225% | 1 498 | 1 497 | |||||||||
3.700% | USD | 500 | 2012 | 2042 | Novartis Capital Corporation, New York, United States | 98.325% | 490 | 490 | |||||||||
3.400% | USD | 2 150 | 2014 | 2024 | Novartis Capital Corporation, New York, United States | 99.287% | 2 144 | 2 142 | |||||||||
4.400% | USD | 1 850 | 2014 | 2044 | Novartis Capital Corporation, New York, United States | 99.196% | 1 826 | 1 826 | |||||||||
0.750% | EUR | 600 | 2014 | 2021 | Novartis Finance S.A., Luxembourg, Luxembourg | 99.134% | 737 | ||||||||||
1.625% | EUR | 600 | 2014 | 2026 | Novartis Finance S.A., Luxembourg, Luxembourg | 99.697% | 676 | 735 | |||||||||
0.250% | CHF | 500 | 2015 | 2025 | Novartis AG, Basel, Switzerland | 100.640% | 547 | 568 | |||||||||
0.625% | CHF | 550 | 2015 | 2029 | Novartis AG, Basel, Switzerland | 100.502% | 602 | 625 | |||||||||
1.050% | CHF | 325 | 2015 | 2035 | Novartis AG, Basel, Switzerland | 100.479% | 356 | 369 | |||||||||
3.000% | USD | 1 750 | 2015 | 2025 | Novartis Capital Corporation, New York, United States | 99.010% | 1 740 | 1 737 | |||||||||
4.000% | USD | 1 250 | 2015 | 2045 | Novartis Capital Corporation, New York, United States | 98.029% | 1 220 | 1 220 | |||||||||
0.125% | EUR | 1 250 | 2016 | 2023 | Novartis Finance S.A., Luxembourg, Luxembourg | 99.127% | 1 409 | 1 530 | |||||||||
0.625% | EUR | 500 | 2016 | 2028 | Novartis Finance S.A., Luxembourg, Luxembourg | 98.480% | 559 | 607 | |||||||||
2.400% | USD | 1 000 | 2017 | 2022 | Novartis Capital Corporation, New York, United States | 99.449% | 1 000 | 998 | |||||||||
3.100% | USD | 1 000 | 2017 | 2027 | Novartis Capital Corporation, New York, United States | 99.109% | 993 | 992 | |||||||||
0.000% | EUR | 1 250 | 2017 | 2021 | Novartis Finance S.A., Luxembourg, Luxembourg | 99.133% | 1 536 | ||||||||||
1.125% | EUR | 600 | 2017 | 2027 | Novartis Finance S.A., Luxembourg, Luxembourg | 99.874% | 677 | 735 | |||||||||
0.500% | EUR | 750 | 2018 | 2023 | Novartis Finance S.A., Luxembourg, Luxembourg | 99.655% | 846 | 919 | |||||||||
1.375% | EUR | 750 | 2018 | 2030 | Novartis Finance S.A., Luxembourg, Luxembourg | 99.957% | 846 | 920 | |||||||||
1.700% | EUR | 750 | 2018 | 2038 | Novartis Finance S.A., Luxembourg, Luxembourg | 99.217% | 840 | 913 | |||||||||
1.750% | USD | 1 000 | 2020 | 2025 | Novartis Capital Corporation, New York, United States | 99.852% | 998 | 996 | |||||||||
2.000% | USD | 1 250 | 2020 | 2027 | Novartis Capital Corporation, New York, United States | 99.909% | 1 246 | 1 245 | |||||||||
2.200% | USD | 1 500 | 2020 | 2030 | Novartis Capital Corporation, New York, United States | 99.869% | 1 493 | 1 493 | |||||||||
2.750% | USD | 1 250 | 2020 | 2050 | Novartis Capital Corporation, New York, United States | 97.712% | 1 214 | 1 213 | |||||||||
0.000% 1 | EUR | 1 850 | 2020 | 2028 | Novartis Finance S.A., Luxembourg, Luxembourg | 99.354% | 2 076 | 2 255 | |||||||||
Total straight bonds | 25 296 | 28 298 | |||||||||||||||
1 The EUR 1 850 million bond issued in 2020 features a coupon step-up of 0.25% commencing with the first interest payment date after December 31, 2025, if one or both of the 2025 Patient Access Targets are not met. These 2025 Patient Access Targets are the 2025 Flagship Programs Patient Reach Target and the 2025 Strategic Innovative Therapies Patient Reach Target, as defined in the bond prospectus. As of December 31, 2021, there is no indication that these 2025 Patient Access Targets will not be met. |
(USD millions) | 2021 | 2020 | |||
2021 | 2 272 | ||||
2022 | 2 621 | 2 631 | |||
2023 | 2 342 | 2 546 | |||
2024 | 2 144 | 2 142 | |||
2025 | 3 284 | 3 302 | |||
2026 | 693 | 735 | |||
After 2026 | 14 439 | 14 903 | |||
Total | 25 523 | 28 531 | |||
(USD millions) | 2021 | 2020 | |||
US dollar (USD) | 15 862 | 15 848 | |||
Euro (EUR) | 7 930 | 10 888 | |||
Japanese yen (JPY) | 174 | 194 | |||
Swiss franc (CHF) | 1 505 | 1 563 | |||
Others | 52 | 38 | |||
Total | 25 523 | 28 531 | |||
(USD millions) | 2021 Balance sheet | 2021 Fair values | 2020 Balance sheet | 2020 Fair values | |||||
Straight bonds | 25 296 | 27 079 | 28 298 | 31 359 | |||||
Others | 227 | 227 | 233 | 233 | |||||
Total | 25 523 | 27 306 | 28 531 | 31 592 | |||||
(USD millions) | 2021 | 2020 | |||
Accrued liability for employee benefits: | |||||
Defined benefit pension plans 1 | 2 640 | 3 538 | |||
Other long-term employee benefits and deferred compensation | 662 | 637 | |||
Other post-employment benefits 1 | 487 | 543 | |||
Environmental remediation provisions | 567 | 642 | |||
Provisions for product liabilities, governmental investigations and other legal matters | 341 | 181 | |||
Contingent consideration 2 | 956 | 984 | |||
Other non-current liabilities | 519 | 409 | |||
Total provisions and other non-current liabilities | 6 172 | 6 934 | |||
1 Note 25 provides additional disclosures related to post-employment benefits. | |||||
2 Note 29 provides additional disclosures related to contingent consideration. |
(USD millions) | 2021 | 2020 | 2019 | ||||
January 1 | 809 | 714 | 692 | ||||
Cash payments | -169 | -10 | -30 | ||||
Releases | -105 | - 27 | -83 | ||||
Additions | 105 | 82 | 124 | ||||
Currency translation effects | -24 | 50 | 11 | ||||
December 31 | 616 | 809 | 714 | ||||
Less current provision | -49 | -167 | -122 | ||||
Non-current environmental remediation provisions at December 31 | 567 | 642 | 592 | ||||
(USD millions) | Expected cash outflows | ||
Due within two years | 94 | ||
Due later than two years, but within five years | 199 | ||
Due later than five years, but within 10 years | 275 | ||
Due after 10 years | 48 | ||
Total environmental remediation liability provisions | 616 | ||
(USD millions) | 2021 | 2020 | 2019 | ||||
January 1 | 487 | 1 369 | 340 | ||||
Provisions related to discontinued operations 1 | -42 | ||||||
Impact of acquisitions of businesses | 11 | 10 | |||||
Cash payments | -292 | -1 863 | -116 | ||||
Releases of provisions | -44 | -31 | -52 | ||||
Additions to provisions | 251 | 1 018 | 1 230 | ||||
Currency translation effects | -5 | -17 | -1 | ||||
December 31 | 397 | 487 | 1 369 | ||||
Less current portion | -56 | -306 | -1 169 | ||||
Non-current product liabilities, governmental investigations and other legal matters provisions at December 31 | 341 | 181 | 200 | ||||
1 Notes 1, 2 and 30 provide information related to discontinued operations. |
(USD millions) | 2021 | 2020 | |||
Interest-bearing accounts of employees payable on demand 1 | 1 814 | 2 085 | |||
Bank and other financial debt 2 | 899 | 976 | |||
Commercial paper | 893 | 4 258 | |||
Current portion of non-current financial debt | 2 621 | 2 272 | |||
Derivative financial instruments | 68 | 194 | |||
Total current financial debt and derivative financial instruments | 6 295 | 9 785 | |||
1 Weighted average interest rate 0.25% (2020: 0.4%) | |||||
2 Weighted average interest rate 6.1% (2020: 5.0%) |
(USD millions) | 2021 | 2020 | |||
Taxes other than income taxes | 619 | 749 | |||
Restructuring provisions | 345 | 459 | |||
Accrued expenses for goods and services received but not invoiced | 1 089 | 1 167 | |||
Accruals for royalties | 752 | 732 | |||
Accrued interests on financial debt | 127 | 133 | |||
Provisions for deductions from revenue | 6 481 | 6 256 | |||
Accruals for compensation and benefits, including social security | 2 260 | 2 286 | |||
Environmental remediation liabilities | 49 | 167 | |||
Deferred income | 123 | 56 | |||
Provisions for product liabilities, governmental investigations and other legal matters 1 | 56 | 306 | |||
Accrued share-based payments | 253 | 269 | |||
Contingent considerations 2 | 119 | 62 | |||
Commitment for repurchase of own shares 3 | 2 809 | 1 769 | |||
Other payables | 588 | 716 | |||
Total provisions and other current liabilities | 15 670 | 15 127 | |||
1 Note 20 provides additional disclosures related to legal provisions. | |||||
2 Note 29 provides additional disclosures related to contingent considerations. | |||||
3 Note 18 provides additional disclosures related to commitment for repurchase of own shares. | |||||
Income statement charge | |||||||||||||||||
(USD millions) | Revenue deductions provisions at January 1 | Revenue deductions provisions related to discontinued operations1 | Effect of currency translation and business combinations | Payments/ utilizations | Adjustments of prior years | Current year | Change in provisions offset against gross trade receivables | Revenue deductions provisions at December 31 | |||||||||
2021 | |||||||||||||||||
US-specific healthcare plans and program rebates | 2 053 | -5 326 | -202 | 5 675 | 2 200 | ||||||||||||
Non-US-specific healthcare plans and program rebates | 2 272 | -154 | -3 439 | 20 | 3 451 | 5 | 2 155 | ||||||||||
Non-healthcare plans and program-related rebates, returns and other deductions | 1 931 | -64 | -11 073 | -63 | 11 287 | 108 | 2 126 | ||||||||||
Total 2021 | 6 256 | -218 | -19 838 | -245 | 20 413 | 113 | 6 481 | ||||||||||
2020 | |||||||||||||||||
US-specific healthcare plans and program rebates | 1 981 | -5 560 | -107 | 5 739 | 2 053 | ||||||||||||
Non-US-specific healthcare plans and program rebates | 1 769 | 167 | -2 597 | 7 | 2 940 | -14 | 2 272 | ||||||||||
Non-healthcare plans and program-related rebates, returns and other deductions | 1 845 | 67 | -11 137 | -51 | 11 094 | 113 | 1 931 | ||||||||||
Total 2020 | 5 595 | 234 | -19 294 | -151 | 19 773 | 99 | 6 256 | ||||||||||
2019 | |||||||||||||||||
US-specific healthcare plans and program rebates | 1 883 | 0 | -5 183 | -193 | 5 474 | 1 981 | |||||||||||
Non-US-specific healthcare plans and program rebates | 1 625 | -28 | -19 | -2 467 | -2 | 2 659 | 1 | 1 769 | |||||||||
Non-healthcare plans and program-related rebates, returns and other deductions | 1 754 | -166 | 9 | -11 698 | -25 | 11 868 | 103 | 1 845 | |||||||||
Total 2019 | 5 262 | -194 | -10 | -19 348 | -220 | 20 001 | 104 | 5 595 | |||||||||
1 Notes 1, 2 and 30 provide information related to discontinued operations. |
(USD millions) | 2021 | 2020 | 2019 | ||||
January 1 | 459 | 438 | 507 | ||||
Provisions related to discontinued operations 1 | -8 | ||||||
Additions | 328 | 354 | 492 | ||||
Cash payments | -344 | -268 | -479 | ||||
Releases | -54 | -87 | -72 | ||||
Transfers | -27 | ||||||
Currency translation effects | -17 | 22 | -2 | ||||
December 31 | 345 | 459 | 438 | ||||
1 Notes 1, 2 and 30 provide information related to discontinued operations. |
(USD millions) | 2021 | 2020 | 2019 | ||||
Depreciation, amortization and impairments on: | |||||||
Property, plant and equipment | 1 489 | 1 758 | 1 547 | ||||
Right-of-use assets | 318 | 330 | 305 | ||||
Intangible assets | 4 306 | 4 376 | 3 974 | ||||
Financial assets 1 | -38 | -335 | -38 | ||||
Change in provisions and other non-current liabilities | 896 | 1 411 | 1 871 | ||||
Gains on disposal and other adjustments on property, plant and equipment; intangible assets; financial assets; and other non-current assets, net | -677 | -478 | -1 234 | ||||
Equity-settled compensation expense | 736 | 738 | 758 | ||||
Income from associated companies 2 | -15 339 | -673 | -659 | ||||
Income taxes | 2 119 | 1 807 | 1 793 | ||||
Net financial expense | 891 | 947 | 805 | ||||
Total | -5 299 | 9 881 | 9 122 | ||||
1 Includes fair value adjustments | |||||||
2 2021 includes the gain of USD 14.6 billion recognized from the divestment of the Group's investment in Roche (see Notes 2 and 4). |
(USD millions) | 2021 | 2020 | 2019 | ||||
Decrease/(increase) in inventories | 81 | -543 | -382 | ||||
(Increase)/decrease in trade receivables | -389 | 137 | -980 | ||||
(Decrease)/increase in trade payables | -21 | -324 | 553 | ||||
Change in other current and non-current assets | -202 | 229 | -160 | ||||
Change in other current liabilities | 772 | 211 | 1 167 | ||||
Other adjustments, net | 0 | -1 | 1 | ||||
Total | 241 | -291 | 199 | ||||
(USD millions) | Note | 2021 | 2020 | 2019 | |||||
Net assets recognized as a result of acquisitions of businesses | 24 | -735 | -10 173 | -4 124 | |||||
Fair value of previously held equity interests | 42 | 7 | 33 | ||||||
Contingent consideration payables, net | 59 | 98 | 242 | ||||||
Payments, deferred consideration and other adjustments, net | 1 | 62 | -2 | ||||||
Cash flows used for acquisitions of businesses | -633 | -10 006 | -3 851 | ||||||
Cash flows from divestments of businesses, net 1 | 66 | 49 | 91 | ||||||
Cash flows used for acquisitions and divestments of businesses, net | -567 | -9 957 | -3 760 | ||||||
1 In 2021, USD 66 million included USD 52 million net cash inflows from divestments in previous years, and a USD 14 million net cash inflow from a business divestment in 2021, comprised of intangible assets. | |||||||||
In 2020, USD 49 million represented the net cash inflows from divestments in previous years. | |||||||||
In 2019, USD 91 million included USD 4 million of net cash outflows from divestments in previous years, and USD 95 million net cash inflows from business divestments in 2019. The net identifiable assets of the 2019 divested businesses amounted to USD 196 million, comprised of non-current assets of USD 159 million; current assets of USD 96 million, including USD 11 million cash and cash equivalents; non-current liabilities of USD 18 million; and current liabilities of USD 41 million. |
(USD millions) | Non-current financial debts | Current financial debts and derivative financial instruments | Non-current lease liabilities | Current lease liabilities | |||||
January 1, 2021 | 26 259 | 9 785 | 1 719 | 286 | |||||
Increase in non-current financial debts | 16 | ||||||||
Repayments of non-current financial debts | -2 162 | ||||||||
Change in current financial debts | -3 524 | ||||||||
Payments of lease liabilities, net | -316 | ||||||||
Interest payments for amounts included in lease liabilities classified as cash flows from operating activities | -52 | ||||||||
New, modified and terminated leases, net | 192 | 61 | |||||||
Impact of acquisitions of businesses | 1 | ||||||||
Changes in fair values, lease interest and other changes, net | -124 | 62 | |||||||
Amortization of bonds discount | 25 | 4 | |||||||
Currency translation effects | -774 | -309 | -43 | -13 | |||||
Reclassification from non-current to current, net | -2 624 | 2 624 | -247 | 247 | |||||
December 31, 2021 | 22 902 | 6 295 | 1 621 | 275 | |||||
(USD millions) | Non-current financial debts | Current financial debts and derivative financial instruments | Non-current lease liabilities | Current lease liabilities | |||||
January 1, 2020 | 20 353 | 7 031 | 1 703 | 246 | |||||
Increase in non-current financial debts | 7 126 | ||||||||
Repayments of non-current financial debts | -2 003 | ||||||||
Change in current financial debts | 2 261 | ||||||||
Payments of lease liabilities, net | -312 | ||||||||
Interest payments for amounts included in lease liabilities classified as cash flows from operating activities | -56 | ||||||||
New, modified and terminated leases, net | 221 | 73 | |||||||
Impact of acquisitions of businesses | 32 | 36 | 8 | ||||||
Changes in fair values, lease interest and other changes, net | -1 | -30 | 65 | ||||||
Amortization of bonds discount | 16 | 5 | |||||||
Currency translation effects | 832 | 392 | 39 | 12 | |||||
Reclassification from non-current to current, net | -2 067 | 2 067 | -250 | 250 | |||||
December 31, 2020 | 26 259 | 9 785 | 1 719 | 286 | |||||
(USD millions) | Non-current financial debts | Current financial debts and derivative financial instruments | Non-current lease liabilities | Current lease liabilities | |||||
January 1, 2019 | 22 470 | 9 678 | |||||||
Impact of adoption of IFRS 16 Leases continuing operations 1 | -2 | -1 | 1 471 | 268 | |||||
Impact of adoption of IFRS 16 Leases discontinued operations 2 | -89 | 246 | 40 | ||||||
Financial debts and lease liabilities related to discontinued operations 3 | -47 | -246 | -40 | ||||||
Increase in non-current financial debts | 93 | ||||||||
Repayments of non-current financial debts | -3 195 | ||||||||
Change in current financial debts | -1 582 | ||||||||
Payments of lease liabilities, net | -273 | ||||||||
Interest payments for amounts included in lease liabilities classified as cash flows from operating activities | -51 | ||||||||
New, modified and terminated leases, net | 362 | 131 | |||||||
Impact of acquisitions and divestments of businesses | 2 | -11 | -6 | ||||||
Changes in fair values, lease interest and other changes, net | 129 | 33 | 20 | ||||||
Amortization of bonds discount | 25 | ||||||||
Currency translation effects | -141 | 44 | 4 | 1 | |||||
Reclassification from non-current to current, net | -2 003 | 2 003 | -156 | 156 | |||||
December 31, 2019 | 20 353 | 7 031 | 1 703 | 246 | |||||
1 Lease liabilities recognized on January 1, 2019, the date of implementation of IFRS 16 Leases. See Note 1. | |||||||||
2 In 2018, financial debts included USD 89 million for previously reported finance lease obligations of the Alcon business that were reclassified on January 1, 2019, to lease liabilities, with the adoption of IFRS 16 Leases. | |||||||||
3 Represents the financial debts and lease liabilities at January 1, 2019, related to the Alcon business reported as discontinued operations. See Notes 1 and 2. |
(USD millions) | 2021 | 2020 | 2019 | ||||
Property, plant and equipment | 26 | 44 | |||||
Right-of-use assets | 32 | ||||||
Currently marketed products | 292 | 196 | 3 550 | ||||
Acquired research and development | 262 | 8 600 | 342 | ||||
Other intangible assets | 98 | 218 | 22 | ||||
Deferred tax assets | 28 | 476 | 60 | ||||
Non-current financial and other assets | 49 | 8 | |||||
Inventories | 84 | 195 | |||||
Trade receivables and financial and other current assets | 1 | 109 | 4 | ||||
Cash and cash equivalents | 10 | 76 | |||||
Deferred tax liabilities | -74 | -1 977 | -107 | ||||
Current and non-current financial debts | -1 | -32 | -2 | ||||
Current and non-current lease liabilities | -44 | ||||||
Trade payables and other liabilities | -4 | -144 | -178 | ||||
Net identifiable assets acquired | 612 | 7 669 | 3 938 | ||||
Acquired cash and cash equivalents | -10 | -76 | |||||
Non-controlling interests | -105 | ||||||
Goodwill | 238 | 2 580 | 186 | ||||
Net assets recognized as a result of acquisitions of businesses | 735 | 10 173 | 4 124 | ||||
Pension plans | Other post-employment benefit plans | ||||||||
(USD millions) | 2021 | 2020 | 2021 | 2020 | |||||
Benefit obligation at January 1 | 25 602 | 23 066 | 632 | 746 | |||||
Current service cost | 415 | 372 | 11 | 11 | |||||
Interest cost | 151 | 222 | 16 | 20 | |||||
Past service costs and settlements | 63 | -102 | -3 | 1 | |||||
Administrative expenses | 24 | 24 | |||||||
Remeasurement (gains)/losses arising from changes in financial assumptions | -713 | 1 166 | -20 | 40 | |||||
Remeasurement (gains)/losses arising from changes in demographic assumptions | -377 | -28 | 4 | -13 | |||||
Experience-related remeasurement losses/(gains) | 531 | 159 | -47 | -132 | |||||
Currency translation effects | -865 | 1 810 | -1 | -7 | |||||
Benefit payments | -1 450 | -1 264 | -32 | -33 | |||||
Contributions of employees | 179 | 186 | |||||||
Effect of acquisitions, divestments or transfers | 23 | -9 | -1 | ||||||
Benefit obligation at December 31 | 23 583 | 25 602 | 560 | 632 | |||||
Fair value of plan assets at January 1 | 22 317 | 19 810 | 89 | 134 | |||||
Interest income | 105 | 166 | 2 | 4 | |||||
Return on plan assets excluding interest income | 1 512 | 1 318 | 7 | 4 | |||||
Currency translation effects | -726 | 1 620 | |||||||
Novartis Group contributions | 490 | 464 | 7 | -20 | |||||
Contributions of employees | 179 | 186 | |||||||
Settlements | -7 | 15 | |||||||
Benefit payments | -1 450 | -1 264 | -32 | -33 | |||||
Effect of acquisitions, divestments or transfers | 2 | ||||||||
Fair value of plan assets at December 31 | 22 420 | 22 317 | 73 | 89 | |||||
Funded status | -1 163 | -3 285 | -487 | -543 | |||||
Limitation on recognition of fund surplus at January 1 | -51 | -65 | |||||||
Change in limitation on recognition of fund surplus (incl. exchange rate differences) | -10 | 16 | |||||||
Interest income on limitation of fund surplus | -1 | -2 | |||||||
Limitation on recognition of fund surplus at December 31 | -62 | -51 | |||||||
Net liability in the balance sheet at December 31 | -1 225 | -3 336 | -487 | -543 | |||||
Pension plans | Other post-employment benefit plans | ||||||||
(USD millions) | 2021 | 2020 | 2021 | 2020 | |||||
Net liability at January 1 | -3 336 | -3 321 | -543 | -612 | |||||
Current service cost | -415 | -372 | -11 | -11 | |||||
Net interest expense | -47 | -58 | -14 | -16 | |||||
Administrative expenses | -24 | -24 | |||||||
Past service costs and settlements | -70 | 117 | 3 | -1 | |||||
Remeasurements | 2 071 | 21 | 70 | 109 | |||||
Currency translation effects | 139 | -190 | 1 | 7 | |||||
Novartis Group contributions | 490 | 464 | 7 | -20 | |||||
Effect of acquisitions, divestments or transfers | -23 | 11 | 1 | ||||||
Change in limitation on recognition of fund surplus | -10 | 16 | |||||||
Net liability at December 31 | -1 225 | -3 336 | -487 | -543 | |||||
Amounts recognized in the consolidated balance sheet | |||||||||
Prepaid benefit cost | 1 415 | 202 | |||||||
Accrued benefit liability | -2 640 | -3 538 | -487 | -543 | |||||
2021 | 2020 | ||||||||||||||||
(USD millions) | Switzerland | United States | Rest of the world | Total | Switzerland | United States | Rest of the world | Total | |||||||||
Benefit obligation at December 31 | 15 268 | 3 645 | 4 670 | 23 583 | 16 807 | 3 788 | 5 007 | 25 602 | |||||||||
Thereof unfunded | 688 | 439 | 1 127 | 701 | 516 | 1 217 | |||||||||||
By type of member | |||||||||||||||||
Active | 6 478 | 620 | 1 412 | 8 510 | 6 837 | 665 | 1 573 | 9 075 | |||||||||
Deferred pensioners | 1 208 | 1 730 | 2 938 | 1 290 | 1 819 | 3 109 | |||||||||||
Pensioners | 8 790 | 1 817 | 1 528 | 12 135 | 9 970 | 1 833 | 1 615 | 13 418 | |||||||||
Fair value of plan assets at December 31 | 16 436 | 2 551 | 3 433 | 22 420 | 16 396 | 2 487 | 3 434 | 22 317 | |||||||||
Funded status | 1 168 | -1 094 | -1 237 | -1 163 | -411 | -1 301 | -1 573 | -3 285 | |||||||||
2021 | 2020 | ||||||||||||
(USD millions) | United States | Rest of the world | Total | United States | Rest of the world | Total | |||||||
Benefit obligation at December 31 | 473 | 87 | 560 | 543 | 89 | 632 | |||||||
Thereof unfunded | 400 | 87 | 487 | 454 | 89 | 543 | |||||||
By type of member | |||||||||||||
Active | 60 | 23 | 83 | 80 | 25 | 105 | |||||||
Deferred pensioners | 13 | 0 | 13 | 17 | 0 | 17 | |||||||
Pensioners | 400 | 64 | 464 | 446 | 64 | 510 | |||||||
Fair value of plan assets at December 31 | 73 | 0 | 73 | 89 | 0 | 89 | |||||||
Funded status | -400 | -87 | -487 | -454 | -89 | -543 | |||||||
Pension plans | Other post-employment benefit plans | ||||||||||||
2021 | 2020 | 2019 | 2021 | 2020 | 2019 | ||||||||
Weighted average assumptions used to determine benefit obligations at December 31 | |||||||||||||
Discount rate | 0.9% | 0.6% | 1.0% | 3.3% | 2.9% | 3.6% | |||||||
Expected rate of pension increase | 0.5% | 0.3% | 0.3% | ||||||||||
Expected rate of salary increase | 2.7% | 2.7% | 2.8% | ||||||||||
Interest on savings account | 0.5% | 0.1% | 0.3% | ||||||||||
Current average life expectancy for a 65-year-old male in years | 22 | 22 | 22 | 21 | 21 | 21 | |||||||
Current average life expectancy for a 65-year-old female in years | 24 | 24 | 24 | 23 | 23 | 23 | |||||||
(USD millions) | Change in 2021 year-end defined benefit pension obligation | ||
25 basis point increase in discount rate | -790 | ||
25 basis point decrease in discount rate | 839 | ||
One-year increase in life expectancy | 869 | ||
25 basis point increase in rate of pension increase | 512 | ||
25 basis point decrease in rate of pension increase | -136 | ||
25 basis point increase of interest on savings account | 58 | ||
25 basis point decrease of interest on savings account | -58 | ||
25 basis point increase in rate of salary increase | 54 | ||
25 basis point decrease in rate of salary increase | -54 | ||
2021 | 2020 | 2019 | |||||
Healthcare cost trend rate assumed for next year | 6.0% | 6.3% | 6.5% | ||||
Rate to which the cost trend rate is assumed to decline | 4.5% | 4.5% | 4.5% | ||||
Year that the rate reaches the ultimate trend rate | 2028 | 2028 | 2028 | ||||
Pension plans | |||||||||
(as a percentage) | Long-term target minimum | Long-term target maximum | 2021 | 2020 | |||||
Equity securities | 15 | 40 | 27 | 28 | |||||
Debt securities | 20 | 60 | 33 | 34 | |||||
Real estate | 5 | 30 | 19 | 17 | |||||
Alternative investments | 0 | 20 | 15 | 13 | |||||
Cash and other investments | 0 | 15 | 6 | 8 | |||||
Total | 100 | 100 | |||||||
December 31, 2021 | December 31, 2020 | ||||
Investment in shares of Novartis AG | |||||
Number of shares (in millions) | 2.3 | 2.3 | |||
Market value (in USD billions) | 0.2 | 0.2 | |||
(USD millions) | Pension plans | Other post- employment benefit plans | |||
Novartis Group contributions | |||||
2022 (estimated) | 424 | 39 | |||
Expected future benefit payments | |||||
2022 | 1 234 | 39 | |||
2023 | 1 237 | 39 | |||
2024 | 1 167 | 39 | |||
2025 | 1 147 | 39 | |||
2026 | 1 134 | 38 | |||
2027–2031 | 5 454 | 178 | |||
(USD millions) | 2021 | 2020 | 2019 | ||||
Contributions for defined contribution plans continuing operations | 523 | 501 | 422 | ||||
(USD millions) | 2021 | 2020 | 2019 | ||||
Expense related to equity-based participation plans | 979 | 958 | 1 067 | ||||
Liabilities arising from equity-based payment transactions | 253 | 269 | 326 | ||||
2021 | 2020 | ||||||||
Options (millions) | Weighted average exercise price (USD) | Options (millions) | Weighted average exercise price (USD) | ||||||
Options outstanding at January 1 | 2.6 | 62.0 | 3.4 | 60.9 | |||||
Sold or exercised | -0.9 | 58.9 | -0.8 | 57.3 | |||||
Outstanding at December 31 | 1.7 | 63.6 | 2.6 | 62.0 | |||||
Exercisable at December 31 | 1.7 | 63.6 | 2.6 | 62.0 | |||||
Options outstanding | Total/ weighted average | ||||||
Number outstanding (millions) | 0.5 | 1.2 | 1.7 | ||||
Remaining contractual life (years) | 0.0 | 1.0 | 0.7 | ||||
Exercise price (USD) | 57.6 | 66.1 | 63.6 | ||||
2021 | 2020 | ||||||||
ADR options (millions) | Weighted average exercise price (USD) | ADR options (millions) | Weighted average exercise price (USD) | ||||||
Options outstanding at January 1 | 6.7 | 62.9 | 9.6 | 61.9 | |||||
Sold or exercised | -2.7 | 60.7 | -2.9 | 59.6 | |||||
Outstanding at December 31 | 4.0 | 64.4 | 6.7 | 62.9 | |||||
Exercisable at December 31 | 4.0 | 64.4 | 6.7 | 62.9 | |||||
ADR options outstanding | Total/ weighted average | ||||||
Number outstanding (millions) | 0.8 | 3.2 | 4.0 | ||||
Remaining contractual life (years) | 0.0 | 1.0 | 0.8 | ||||
Exercise price (USD) | 58.3 | 65.9 | 64.4 | ||||
2021 | 2020 | ||||||||
Number of shares in millions | Weighted average fair value at grant date in USD | Number of shares in millions | Weighted average fair value at grant date in USD | ||||||
Annual Incentive | |||||||||
– RSU | 0.2 | 87.5 | 0.3 | 86.8 | |||||
– Restricted shares | 0.1 | 97.0 | 0.1 | 96.0 | |||||
Share savings plans | |||||||||
– RSU | 0.4 | 86.9 | 0.4 | 87.0 | |||||
– Shares | 1.1 | 97.0 | 1.4 | 96.0 | |||||
Select North America (RSU) | 4.3 | 86.9 | 3.3 | 86.7 | |||||
Select outside North America | |||||||||
– RSU | 1.8 | 86.9 | 1.5 | 87.0 | |||||
– Restricted shares | 0.6 | 97.0 | 0.5 | 96.0 | |||||
Long-Term Performance Plan (PSU) | 1.8 | 89.5 | 2.5 | 85.1 | |||||
Long-Term Relative Performance Plan 1 | 0.2 | 0.0 | |||||||
Other share awards | |||||||||
– RSU | 0.6 | 78.4 | 1.3 | 77.0 | |||||
– Restricted shares | 0.1 | 88.7 | |||||||
– Shares | 0.1 | 91.9 | 0.1 | 88.5 | |||||
1 LTRPP grants in 2020 represent incremental payouts based on performance criteria under the plan. |
Executive Officers | Non-Executive Directors | Total | |||||||||||||||||
(USD millions) | 2021 | 2020 | 2019 | 2021 | 2020 | 2019 | 2021 | 2020 | 2019 | ||||||||||
Cash and other compensation | 20.3 | 25.6 | 20.7 | 4.7 | 4.6 | 4.1 | 25.0 | 30.2 | 24.8 | ||||||||||
Post-employment benefits | 2.5 | 2.7 | 2.6 | 2.5 | 2.7 | 2.6 | |||||||||||||
Equity-based compensation | 37.3 | 41.1 | 40.6 | 5.2 | 5.2 | 4.6 | 42.5 | 46.3 | 45.2 | ||||||||||
Total | 60.1 | 69.4 | 63.9 | 9.9 | 9.8 | 8.7 | 70.0 | 79.2 | 72.6 | ||||||||||
Currency | 2021 | 2020 | 2019 | ||||||
Dr. Krauer | CHF | 60 000 | 60 000 | 60 000 | |||||
(USD millions) | 2021 | ||
2022 | 602 | ||
2023 | 1 088 | ||
2024 | 472 | ||
2025 | 629 | ||
2026 | 113 | ||
Thereafter | 3 839 | ||
Total | 6 743 | ||
2021 | |||||||||||
(USD millions) | Note | Financial instruments at amortized costs | Financial instruments at fair value through other comprehensive income | Financial instruments at fair value through the consolidated income statement | Other financial liabilities | ||||||
Cash and cash equivalents 1 | 16 | 10 397 | 2 010 | ||||||||
Time deposits and short-term investments with original maturity more than 90 days | 16 | 12 965 | |||||||||
Trade receivables | 15 | 8 005 | |||||||||
Other receivables and current assets | 17 | 793 | |||||||||
Marketable securities - debt securities | 16 | 2 741 | |||||||||
Long-term financial investments - equity securities | 13 | 1 195 | 468 | ||||||||
Long-term financial investments - debt securities | 13 | 34 | |||||||||
Long-term financial investments - fund investments | 13 | 366 | |||||||||
Long-term loans, advances, security deposits and other long-term receivables | 13 | 332 | |||||||||
Associated companies at fair value through profit and loss | 192 | ||||||||||
Derivative financial instruments | 16 | 105 | |||||||||
Contingent consideration receivables | 13 | 641 | |||||||||
Total financial assets | 32 492 | 5 980 | 1 772 | ||||||||
Interest-bearing accounts of employees payable on demand | 21 | 1 814 | |||||||||
Bank and other short-term financial debt | 21 | 899 | |||||||||
Commercial paper | 21 | 893 | |||||||||
Straight bonds | 19 | 25 296 | |||||||||
Long-term liabilities to banks and other financial institutions | 19 | 227 | |||||||||
Trade payables | 5 553 | ||||||||||
Commitment for repurchase of own shares | 18/22 | 2 809 | |||||||||
Contingent consideration liabilities (see Note 20/22) and other financial liabilities | 1 094 | ||||||||||
Derivative financial instruments | 21 | 68 | |||||||||
Lease liabilities | 10 | 1 896 | |||||||||
Total financial liabilities | 37 491 | 1 162 | 1 896 | ||||||||
1 Includes short-term highly rated government-backed debt securities, with an original maturity of three months or less |
2020 | |||||||||||
(USD millions) | Note | Financial instruments at amortized costs | Financial instruments at fair value through other comprehensive income | Financial instruments at fair value through the consolidated income statement | Other financial liabilities | ||||||
Cash and cash equivalents | 16 | 9 658 | |||||||||
Time deposits and short-term investments with original maturity more than 90 days | 16 | 1 609 | |||||||||
Trade receivables | 15 | 8 217 | |||||||||
Other receivables and current assets | 17 | 963 | |||||||||
Marketable securities - debt securities | 16 | 26 | |||||||||
Long-term financial investments - equity securities | 13 | 1 111 | 466 | ||||||||
Long-term financial investments - debt securities | 13 | 36 | |||||||||
Long-term financial investments - fund investments | 13 | 366 | |||||||||
Long-term loans, advances, security deposits and other long-term receivables | 13 | 297 | |||||||||
Associated companies at fair value through profit and loss | 211 | ||||||||||
Derivative financial instruments | 16 | 159 | |||||||||
Contingent consideration receivables | 13 | 625 | |||||||||
Total financial assets | 20 744 | 1 173 | 1 827 | ||||||||
Interest-bearing accounts of employees payable on demand | 21 | 2 085 | |||||||||
Bank and other short-term financial debt | 21 | 976 | |||||||||
Commercial paper | 21 | 4 258 | |||||||||
Straight bonds | 19 | 28 298 | |||||||||
Long-term liabilities to banks and other financial institutions | 19 | 233 | |||||||||
Trade payables | 5 403 | ||||||||||
Commitment for repurchase of own shares | 18/22 | 1 769 | |||||||||
Contingent consideration liabilities (see Note 20/22) and other financial liabilities | 1 069 | ||||||||||
Derivative financial instruments | 21 | 194 | |||||||||
Lease liabilities | 10 | 2 005 | |||||||||
Total financial liabilities | 43 022 | 1 263 | 2 005 | ||||||||
Contract or underlying principal amount | Positive fair values | Negative fair values | |||||||||||
(USD millions) | 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | |||||||
Forward foreign exchange rate contracts | 13 248 | 13 679 | 92 | 151 | -35 | -165 | |||||||
Commodity purchase contract | 17 | 11 | 13 | 8 | |||||||||
Options on equity securities | 82 | 70 | -33 | -29 | |||||||||
Total derivative financial instruments included in marketable securities and in current financial debts | 13 347 | 13 760 | 105 | 159 | -68 | -194 | |||||||
2021 | |||||||||
(USD millions) | EUR | USD | Other | Total | |||||
Forward foreign exchange rate contracts | 1 485 | 5 158 | 6 605 | 13 248 | |||||
Commodity purchase contract | 17 | 17 | |||||||
Options on equity securities | 82 | 82 | |||||||
Total derivative financial instruments | 1 485 | 5 257 | 6 605 | 13 347 | |||||
2020 | |||||||||
(USD millions) | EUR | USD | Other | Total | |||||
Forward foreign exchange rate contracts | 2 432 | 6 376 | 4 871 | 13 679 | |||||
Commodity purchase contract | 11 | 11 | |||||||
Options on equity securities | 70 | 70 | |||||||
Total derivative financial instruments | 2 432 | 6 457 | 4 871 | 13 760 | |||||
2021 | |||||||||
(USD millions) | Level 1 | Level 2 | Level 3 | Total | |||||
Financial assets | |||||||||
Debt securities 1 | 2 010 | 2 010 | |||||||
Cash and cash equivalents | 2 010 | 2 010 | |||||||
Marketable securities - debt securities | 2 719 | 22 | 2 741 | ||||||
Total marketable securities | 2 719 | 22 | 2 741 | ||||||
Derivative financial instruments | 105 | 105 | |||||||
Total marketable securities and derivative financial instruments | 2 719 | 127 | 2 846 | ||||||
Debt and equity securities | 1 080 | 617 | 1 697 | ||||||
Fund investments | 28 | 338 | 366 | ||||||
Contingent consideration receivables | 641 | 641 | |||||||
Total long-term financial investments | 1 108 | 1 596 | 2 704 | ||||||
Associated companies at fair value through profit and loss | 192 | 192 | |||||||
Financial liabilities | |||||||||
Contingent consideration payables | -1 075 | -1 075 | |||||||
Other financial liabilities | -19 | -19 | |||||||
Derivative financial instruments | -68 | -68 | |||||||
Total financial liabilities at fair value | -68 | -1 094 | -1 162 | ||||||
1 Includes short-term highly rated government-backed debt securities, with an original maturity of three months or less |
2020 | |||||||||
(USD millions) | Level 1 | Level 2 | Level 3 | Total | |||||
Financial assets | |||||||||
Debt securities | 26 | 26 | |||||||
Total marketable securities | 26 | 26 | |||||||
Derivative financial instruments | 159 | 159 | |||||||
Total marketable securities and derivative financial instruments | 185 | 185 | |||||||
Debt and equity securities | 1 153 | 460 | 1 613 | ||||||
Fund investments | 30 | 336 | 366 | ||||||
Contingent consideration receivables | 625 | 625 | |||||||
Total long-term financial investments | 1 183 | 1 421 | 2 604 | ||||||
Associated companies at fair value through profit and loss | 211 | 211 | |||||||
Financial liabilities | |||||||||
Contingent consideration payables | -1 046 | -1 046 | |||||||
Other financial liabilities | -23 | -23 | |||||||
Derivative financial instruments | -194 | -194 | |||||||
Total financial liabilities at fair value | -194 | -1 069 | -1 263 | ||||||
2021 | |||||||||||
(USD millions) | Associated companies at fair value through profit and loss | Fund investments | Long-term financial investments | Contingent consideration receivables | Contingent consideration payables | ||||||
January 1 | 211 | 366 | 460 | 625 | -1 046 | ||||||
Fair value gains and other adjustments, including from divestments recognized in the consolidated income statement | 2 | 70 | 69 | 124 | 182 | ||||||
Fair value losses (including impairments and amortizations) and other adjustments recognized in the consolidated income statement | -26 | -8 | -13 | -44 | -189 | ||||||
Fair value adjustments recognized in the consolidated statement of comprehensive income, including currency translation effects | -2 | -1 | 51 | -22 | 22 | ||||||
Purchases | 34 | 12 | 137 | -88 | |||||||
Cash receipts and payments | -42 | 44 | |||||||||
Disposals | -27 | -71 | -43 | ||||||||
Reclassification | -30 | -44 | |||||||||
December 31 | 192 | 338 | 617 | 641 | -1 075 | ||||||
Total of fair value gains and losses recognized in the consolidated income statement for assets and liabilities held at December 31, 2021 | -24 | 62 | 56 | 80 | -7 | ||||||
2020 | ||||||||||||||
(USD millions) | Associated companies at fair value through profit and loss | Fund investments | Long-term financial investments | Contingent consideration receivables | Contingent consideration payables | Other financial liabilities | ||||||||
January 1 | 186 | 233 | 581 | 399 | -1 036 | -29 | ||||||||
Fair value gains and other adjustments, including from divestments recognized in the consolidated income statement | 57 | 151 | 34 | 173 | 206 | |||||||||
Fair value losses (including impairments and amortizations) and other adjustments recognized in the consolidated income statement | -18 | -8 | -39 | -90 | -3 | |||||||||
Fair value adjustments recognized in the consolidated statement of comprehensive income | 4 | 3 | 33 | 40 | -62 | -2 | ||||||||
Purchases | 24 | 17 | 123 | 43 | -123 | |||||||||
Cash receipts and payments | -30 | 63 | 11 | |||||||||||
Disposals | -23 | -61 | -109 | |||||||||||
Reclassification | -19 | 31 | -163 | -4 | ||||||||||
December 31 | 211 | 366 | 460 | 625 | -1 046 | -23 | ||||||||
Total of fair value gains and losses recognized in the consolidated income statement for assets and liabilities held at December 31, 2020 | 39 | 143 | -5 | 173 | 116 | -3 | ||||||||
(USD millions) | 2021 | 2020 | |||
Listed equity securities | 888 | 862 | |||
Non-listed equity securities | 307 | 249 | |||
Total equity securities | 1 195 | 1 111 | |||
2021 | |||||||||||||
(USD millions) | Due within one month | Due later than one month but less than three months | Due later than three months but less than one year | Due later than one year but less than five years | Due after five years | Total | |||||||
Current assets | |||||||||||||
Marketable securities, time deposits and short-term investments with original maturity more than 90 days and accrued interest | 11 | 14 585 | 1 088 | 4 | 18 | 15 706 | |||||||
Commodities | 111 | 111 | |||||||||||
Derivative financial instruments | 21 | 64 | 7 | 13 | 105 | ||||||||
Cash and cash equivalents | 7 406 | 5 001 | 12 407 | ||||||||||
Total current financial assets | 7 438 | 19 650 | 1 095 | 4 | 142 | 28 329 | |||||||
Non-current liabilities | |||||||||||||
Financial debt | -8 464 | -14 438 | -22 902 | ||||||||||
Financial debt - undiscounted | -8 490 | -14 587 | -23 077 | ||||||||||
Total non-current financial debt | -8 464 | -14 438 | -22 902 | ||||||||||
Current liabilities | |||||||||||||
Financial debt | -2 780 | -521 | -2 926 | -6 227 | |||||||||
Financial debt - undiscounted | -2 780 | -521 | -2 928 | -6 229 | |||||||||
Derivative financial instruments | -50 | -16 | -2 | -68 | |||||||||
Total current financial debt | -2 830 | -537 | -2 928 | -6 295 | |||||||||
Net debt | 4 608 | 19 113 | -1 833 | -8 460 | -14 296 | -868 | |||||||
2020 | |||||||||||||
(USD millions) | Due within one month | Due later than one month but less than three months | Due later than three months but less than one year | Due later than one year but less than five years | Due after five years | Total | |||||||
Current assets | |||||||||||||
Marketable securities, time deposits and short-term investments with original maturity more than 90 days | 13 | 1 571 | 25 | 5 | 21 | 1 635 | |||||||
Commodities | 111 | 111 | |||||||||||
Derivative financial instruments and accrued interest | 38 | 110 | 4 | 4 | 3 | 159 | |||||||
Cash and cash equivalents | 8 558 | 1 100 | 9 658 | ||||||||||
Total current financial assets | 8 609 | 2 781 | 29 | 9 | 135 | 11 563 | |||||||
Non-current liabilities | |||||||||||||
Financial debt | -10 621 | -15 638 | -26 259 | ||||||||||
Financial debt - undiscounted | -10 661 | -15 802 | -26 463 | ||||||||||
Total non-current financial debt | -10 621 | -15 638 | -26 259 | ||||||||||
Current liabilities | |||||||||||||
Financial debt | -4 195 | -2 218 | -3 178 | -9 591 | |||||||||
Financial debt - undiscounted | -4 195 | -2 219 | -3 179 | -9 593 | |||||||||
Derivative financial instruments | -93 | -84 | -17 | -194 | |||||||||
Total current financial debt | -4 288 | -2 302 | -3 195 | -9 785 | |||||||||
Net debt | 4 321 | 479 | -3 166 | -10 612 | -15 503 | -24 481 | |||||||
2021 | |||||||||
(USD millions) | Due within one month | Due later than one month but less than three months | Due later than three months but less than one year | Total | |||||
Derivative financial instruments and accrued interest on derivative financial instruments | |||||||||
Potential outflows in various currencies - from financial derivative liabilities | -843 | -5 482 | -461 | -6 786 | |||||
Potential inflows in various currencies - from financial derivative assets | 847 | 5 516 | 457 | 6 820 | |||||
2020 | |||||||||
(USD millions) | Due within one month | Due later than one month but less than three months | Due later than three months but less than one year | Total | |||||
Derivative financial instruments and accrued interest on derivative financial instruments | |||||||||
Potential outflows in various currencies - from financial derivative liabilities | -930 | -4 096 | -719 | -5 745 | |||||
Potential inflows in various currencies - from financial derivative assets | 904 | 4 114 | 710 | 5 728 | |||||
2021 | |||||||||||
(USD millions) | Due within three months | Due later than three months but less than one year | Due later than one year but less than five years | Due after five years | Total | ||||||
Contractual interest on non-current liabilities | -82 | -445 | -1 628 | -3 908 | -6 063 | ||||||
Lease liabilities | -78 | -197 | -639 | -982 | -1 896 | ||||||
Trade payables | -5 373 | -180 | -5 553 | ||||||||
Commitment for repurchase of own shares | -2 809 | -2 809 | |||||||||
Contingent consideration liabilities | -54 | -65 | -517 | -439 | -1 075 | ||||||
2020 | |||||||||||
(USD millions) | Due within three months | Due later than three months but less than one year | Due later than one year but less than five years | Due after five years | Total | ||||||
Contractual interest on non-current liabilities | -82 | -468 | -1 846 | -4 251 | -6 647 | ||||||
Lease liabilities | -77 | -209 | -692 | -1 027 | -2 005 | ||||||
Trade payables | -5 239 | -164 | -5 403 | ||||||||
Commitment for repurchase of own shares | -1 769 | -1 769 | |||||||||
Contingent consideration liabilities | -24 | -38 | -639 | -345 | -1 046 | ||||||
(USD millions) | 2021 | 2020 | |||
5% increase in currency exchange rates against USD | 3 | 5 | |||
5% decrease in currency exchange rates against USD | -3 | -5 | |||
(USD millions) | 2021 | 2020 | |||
5% increase in currency exchange rates against USD | 99 | 108 | |||
5% decrease in currency exchange rates against USD | -104 | -114 | |||
(USD millions) | 2021 | 2020 | |||
15% increase in equity prices | 154 | 156 | |||
15% decrease in equity prices | -154 | -156 | |||
(USD millions) | 2021 | 2020 | |||
15% increase in equity prices | 179 | 167 | |||
15% decrease in equity prices | -179 | -167 | |||
(USD millions) | 20191 | ||
Net sales to third parties from discontinued operations | 1 777 | ||
Sales to continuing segments | 32 | ||
Net sales from discontinued operations | 1 809 | ||
Cost of goods sold | -860 | ||
Gross profit from discontinued operations | 949 | ||
Selling, general and administration | -638 | ||
Research and development | -142 | ||
Other income | 15 | ||
Other expense | -113 | ||
Operating income from discontinued operations | 71 | ||
Interest expense | -10 | ||
Other financial income and expense | -3 | ||
Income before taxes from discontinued operations | 58 | ||
Income taxes | -159 | ||
Net loss from discontinued operations before gain on distribution of Alcon Inc. to Novartis AG shareholders | -101 | ||
Gain on distribution of Alcon Inc. to Novartis AG shareholders 2 | 4 691 | ||
Net income from discontinued operations | 4 590 | ||
1 The consolidated income statement amounts are for the period from January 1, 2019, to the completion of the spin-off. | |||
2 See Note 2 for further details on the non-taxable, non-cash gain on distribution of Alcon Inc. to Novartis AG shareholders. |
Useful life | Income statement location for amortization and impairment charges | ||||
Marketing know-how | 25 years | "Cost of goods sold" | |||
Alcon brand name | Not amortized, indefinite useful life | "Other expense" | |||
(USD millions) | 2019 | ||
Depreciation of property, plant and equipment | -42 | ||
Depreciation of right-of-use assets | -9 | ||
Amortization of intangible assets | -174 | ||
Equity-based compensation of Novartis equity plans | -9 | ||
(USD millions) | 2020 | 2019 | |||
Payments attributable to the spin-off of the Alcon business | -39 | -29 | |||
Divested cash and cash equivalents | -628 | ||||
Cash flows attributable to the spin-off of the Alcon business | -39 | -657 | |||
Other cash flows used in investing activities, net | -88 | -502 | |||
Net cash flows used in investing activities from discontinued operations | -127 | -1 159 | |||
(USD millions) | 2019 | ||
Contributions for defined contribution plans discontinued operations | 33 | ||
As at December 31, 2021 | Share capital1 | Equity interest | |||||||
Algeria | |||||||||
Société par actions SANDOZ | Algiers | DZD | 650.0 | m | 100% | ||||
Argentina | |||||||||
Novartis Argentina S.A. | Buenos Aires | ARS | 906.1 | m | 100% | ||||
Australia | |||||||||
Novartis Australia Pty Ltd | Macquarie Park, NSW | AUD | 2 | 100% | |||||
Novartis Pharmaceuticals Australia Pty Ltd | Macquarie Park, NSW | AUD | 3.8 | m | 100% | ||||
Sandoz Pty Ltd | Macquarie Park, NSW | AUD | 11.6 | m | 100% | ||||
Austria | |||||||||
Novartis Austria GmbH | Vienna | EUR | 1.0 | m | 100% | ||||
Novartis Pharma GmbH | Vienna | EUR | 1.1 | m | 100% | ||||
Sandoz GmbH | Kundl | EUR | 32.7 | m | 100% | ||||
EBEWE Pharma Ges.m.b.H Nfg. KG | Unterach am Attersee | EUR | 1.0 | m | 100% | ||||
Bangladesh | |||||||||
Novartis (Bangladesh) Limited | Gazipur | BDT | 162.5 | m | 60% | ||||
Belgium | |||||||||
Novartis Pharma NV | Vilvoorde | EUR | 7.1 | m | 100% | ||||
Sandoz NV | Vilvoorde | EUR | 19.2 | m | 100% | ||||
Alcon - Couvreur NV | Puurs | EUR | 110.6 | m | 100% | ||||
Bermuda | |||||||||
Novartis Investment Ltd. | Hamilton 2 | USD | 12 000 | 100% | |||||
Novartis Securities Investment Ltd. | Hamilton | CHF | 30 000 | 100% | |||||
Novartis Finance Services Ltd. | Hamilton | CHF | 20 000 | 100% | |||||
Triangle International Reinsurance Limited | Hamilton | CHF | 1.0 | m | 100% | ||||
Trinity River Insurance Co Ltd. | Hamilton | USD | 370 000 | 100% | |||||
Brazil | |||||||||
Novartis Biociências S.A. | São Paulo | BRL | 507.1 | m | 100% | ||||
Sandoz do Brasil Indústria Farmacêutica Ltda. | Cambé, PR | BRL | 190.0 | m | 100% | ||||
Canada | |||||||||
Novartis Pharmaceuticals Canada Inc. | Dorval, Quebec | CAD | 1.2 | m | 100% | ||||
Sandoz Canada Inc. | Boucherville, Quebec | CAD | 80.8 | m | 100% | ||||
Sandoz Manufacturing Inc. | Boucherville, Quebec | CAD | 65.7 | m | 100% | ||||
Chile | |||||||||
Novartis Chile S.A. | Santiago de Chile | CLP | 2.0 | bn | 100% | ||||
China | |||||||||
Beijing Novartis Pharma Co., Ltd. | Beijing | USD | 30.0 | m | 100% | ||||
Novartis Pharmaceuticals (HK) Limited | Hong Kong | HKD | 200 | 100% | |||||
China Novartis Institutes for BioMedical Research Co., Ltd. | Shanghai | USD | 320.0 | m | 100% | ||||
Suzhou Novartis Technical Development Co., Ltd. | Changshu | USD | 12.0 | m | 100% | ||||
Shanghai Novartis Trading Ltd. | Shanghai | USD | 3.2 | m | 100% | ||||
Sandoz (China) Pharmaceutical Co., Ltd. | Zhongshan | USD | 57.6 | m | 100% | ||||
Colombia | |||||||||
Novartis de Colombia S.A. | Santafé de Bogotá | COP | 7.9 | bn | 100% | ||||
Croatia | |||||||||
Sandoz d.o.o. farmaceutska industrija | Zagreb | HRK | 25.6 | m | 100% | ||||
Czech Republic | |||||||||
Novartis s.r.o. | Prague | CZK | 51.5 | m | 100% | ||||
Sandoz s.r.o. | Prague | CZK | 44.7 | m | 100% | ||||
Denmark | |||||||||
Novartis Healthcare A/S | Copenhagen | DKK | 14.0 | m | 100% | ||||
Sandoz A/S | Copenhagen | DKK | 12.0 | m | 100% | ||||
Ecuador | |||||||||
Novartis Ecuador S.A. | Quito | USD | 4.0 | m | 100% | ||||
Egypt | |||||||||
Novartis Pharma S.A.E. | Cairo | EGP | 1.3 | bn | 99.96% | ||||
Sandoz Egypt Pharma S.A.E. | New Cairo City | EGP | 250 000 | 100% | |||||
Finland | |||||||||
Novartis Finland Oy | Espoo | EUR | 459 000 | 100% | |||||
As at December 31, 2021 | Share capital1 | Equity interest | |||||||
France | |||||||||
Novartis Groupe France S.A. | Rueil-Malmaison | EUR | 903.0 | m | 100% | ||||
Novartis Pharma S.A.S. | Rueil-Malmaison | EUR | 43.4 | m | 100% | ||||
Advanced Accelerator Applications S.A. | Saint-Genis-Pouilly | EUR | 9.6 | m | 99.23% | ||||
CELLforCURE | Les Ulis | EUR | 4.2 | m | 100% | ||||
Sandoz S.A.S. | Levallois-Perret | EUR | 5.4 | m | 100% | ||||
Germany | |||||||||
Novartis Deutschland GmbH | Nuremberg | EUR | 155.5 | m | 100% | ||||
Novartis Business Services GmbH | Wehr | EUR | 25 000 | 100% | |||||
Novartis Pharma GmbH | Nuremberg | EUR | 25.6 | m | 100% | ||||
Novartis Pharma Produktions GmbH | Wehr | EUR | 2.0 | m | 100% | ||||
Sandoz International GmbH | Holzkirchen | EUR | 100 000 | 100% | |||||
1 A Pharma GmbH | Oberhaching | EUR | 26 000 | 100% | |||||
HEXAL AG | Holzkirchen | EUR | 93.7 | m | 100% | ||||
Salutas Pharma GmbH | Barleben | EUR | 42.1 | m | 100% | ||||
Aeropharm GmbH | Rudolstadt | EUR | 26 000 | 100% | |||||
Greece | |||||||||
Novartis (Hellas) S.A.C.I. | Metamorphosis / Athens | EUR | 233.9 | m | 100% | ||||
Hungary | |||||||||
Novartis Hungary Healthcare Limited Liability Company | Budapest | HUF | 545.6 | m | 100% | ||||
Sandoz Hungary Limited Liability Company | Budapest | HUF | 883.0 | m | 100% | ||||
India | |||||||||
Novartis India Limited | Mumbai | INR | 123.5 | m | 70.68% | ||||
Novartis Healthcare Private Limited | Mumbai | INR | 60.0 | m | 100% | ||||
Sandoz Private Limited | Mumbai | INR | 32.0 | m | 100% | ||||
Indonesia | |||||||||
PT. Novartis Indonesia | Jakarta | IDR | 7.7 | bn | 100% | ||||
Ireland | |||||||||
Novartis Ireland Limited | Dublin | EUR | 25 000 | 100% | |||||
Novartis Integrated Services Limited | Cork City | EUR | 100 | 100% | |||||
Novartis Ringaskiddy Limited | Ringaskiddy, County Cork | EUR | 2.0 | m | 100% | ||||
Novartis Gene Therapies EU Limited | Dublin | EUR | 100 | 100% | |||||
Israel | |||||||||
Novartis Israel Ltd. | Tel Aviv | ILS | 1 000 | 100% | |||||
Italy | |||||||||
Novartis Farma S.p.A. | Origgio | EUR | 18.2 | m | 100% | ||||
Advanced Accelerator Applications (Italy) S.r.l. | Pozzilli | EUR | 119 000 | 99.23% | |||||
Sandoz S.p.A. | Origgio | EUR | 1.7 | m | 100% | ||||
Japan | |||||||||
Novartis Pharma K.K. | Tokyo | JPY | 100.0 | m | 100% | ||||
Ciba-Geigy Japan Limited | Tokyo | JPY | 100.0 | m | 100% | ||||
Sandoz K.K. | Tokyo | JPY | 100.0 | m | 100% | ||||
Sandoz Pharma K.K. | Tokyo | JPY | 100.0 | m | 100% | ||||
Latvia | |||||||||
Novartis Baltics SIA | Riga | EUR | 3.0 | m | 100% | ||||
Luxembourg | |||||||||
Novartis Investments S.à r.l. | Luxembourg City 2 | USD | 100.0 | m | 100% | ||||
Novartis Finance S.A. | Luxembourg City | USD | 100 000 | 100% | |||||
Malaysia | |||||||||
Novartis Corporation (Malaysia) Sdn. Bhd. | Petaling Jaya | MYR | 3.3 | m | 100% | ||||
Mexico | |||||||||
Novartis Farmacéutica, S.A. de C.V. | Mexico City | MXN | 205.0 | m | 100% | ||||
Sandoz, S.A. de C.V. | Mexico City | MXN | 468.2 | m | 100% | ||||
Morocco | |||||||||
Novartis Pharma Maroc SA | Casablanca | MAD | 80.0 | m | 100% | ||||
Netherlands | |||||||||
Novartis Netherlands B.V. | Amsterdam | EUR | 1.4 | m | 100% | ||||
Novartis Pharma B.V. | Amsterdam | EUR | 4.5 | m | 100% | ||||
IDB Holland BV | Baarle-Nassau | EUR | 18 000 | 99.23% | |||||
Sandoz B.V. | Almere | EUR | 907 560 | 100% | |||||
New Zealand | |||||||||
Novartis New Zealand Ltd | Auckland | NZD | 820 000 | 100% | |||||
As at December 31, 2021 | Share capital1 | Equity interest | |||||||
Norway | |||||||||
Novartis Norge AS | Oslo | NOK | 1.5 | m | 100% | ||||
Pakistan | |||||||||
Novartis Pharma (Pakistan) Limited | Karachi | PKR | 6.7 | bn | 99.99% | ||||
Panama | |||||||||
Novartis Pharma (Logistics), Inc. | Panama City | USD | 10 000 | 100% | |||||
Peru | |||||||||
Novartis Biosciences Perú S.A. | Lima | PEN | 1.4 | m | 100% | ||||
Philippines | |||||||||
Novartis Healthcare Philippines, Inc. | Makati City | PHP | 298.8 | m | 100% | ||||
Sandoz Philippines Corporation | Makati City | PHP | 30.0 | m | 100% | ||||
Poland | |||||||||
Novartis Poland Sp. z o.o. | Warsaw | PLN | 44.2 | m | 100% | ||||
Sandoz Polska Sp. z o.o. | Warsaw | PLN | 25.6 | m | 100% | ||||
Lek S.A. | Strykow | PLN | 11.4 | m | 100% | ||||
Portugal | |||||||||
Novartis Portugal, S.G.P.S., Lda. | Porto Salvo | EUR | 500 000 | 100% | |||||
Novartis Farma - Produtos Farmacêuticos, S.A. | Porto Salvo | EUR | 2.4 | m | 100% | ||||
Sandoz Farmacêutica, Lda. | Porto Salvo | EUR | 499 900 | 100% | |||||
Romania | |||||||||
Novartis Pharma Services Romania S.R.L. | Bucharest | RON | 3.0 | m | 100% | ||||
Sandoz S.R.L. | Targu-Mures | RON | 105.2 | m | 100% | ||||
Russian Federation | |||||||||
Novartis Pharma LLC | Moscow | RUB | 20.0 | m | 100% | ||||
Novartis Neva LLC | St. Petersburg | RUB | 500.0 | m | 100% | ||||
JSC Sandoz | Moscow | RUB | 57.4 | m | 100% | ||||
Saudi Arabia | |||||||||
Novartis Saudi Ltd. | Riyadh | SAR | 30.0 | m | 100% | ||||
Singapore | |||||||||
Novartis (Singapore) Pte Ltd. | Singapore | SGD | 100 000 | 100% | |||||
Novartis Singapore Pharmaceutical Manufacturing Pte Ltd | Singapore | SGD | 45.0 | m | 100% | ||||
Novartis Asia Pacific Pharmaceuticals Pte Ltd | Singapore | SGD | 39.0 | m | 100% | ||||
Slovakia | |||||||||
Novartis Slovakia s.r.o. | Bratislava | EUR | 2.0 | m | 100% | ||||
Slovenia | |||||||||
Lek Pharmaceuticals d.d. | Ljubljana | EUR | 48.4 | m | 100% | ||||
Sandoz Pharmaceuticals d.d. | Ljubljana | EUR | 1.5 | m | 100% | ||||
South Africa | |||||||||
Novartis South Africa (Pty) Ltd | Midrand | ZAR | 86.3 | m | 100% | ||||
Sandoz South Africa (Pty) Ltd | Kempton Park | ZAR | 3.0 | m | 100% | ||||
South Korea | |||||||||
Novartis Korea Ltd. | Seoul | KRW | 24.5 | bn | 100% | ||||
Spain | |||||||||
Novartis Farmacéutica, S.A. | Barcelona | EUR | 63.0 | m | 100% | ||||
Advanced Accelerator Applications Iberica, S.L.U. | Esplugues de Llobregat | EUR | 22.6 | m | 99.23% | ||||
Sandoz Farmacéutica S.A. | Madrid | EUR | 270 450 | 100% | |||||
Sandoz Industrial Products S.A. | Les Franqueses del Vallés / Barcelona | EUR | 9.3 | m | 100% | ||||
Abadia Retuerta S.A. | Sardón de Duero / Valladolid | EUR | 6.0 | m | 100% | ||||
Sweden | |||||||||
Novartis Sverige AB | Stockholm | SEK | 5.0 | m | 100% | ||||
Switzerland | |||||||||
Novartis International AG | Basel | CHF | 10.0 | m | 100% | ||||
Novartis Holding AG | Basel 2 | CHF | 100.2 | m | 100% | ||||
Novartis International Pharmaceutical Investment AG | Basel | CHF | 100 000 | 100% | |||||
Novartis Bioventures AG | Basel | CHF | 100 000 | 100% | |||||
Novartis Forschungsstiftung | Basel 3 | -- | -- | -- | |||||
Novartis Stiftung für Kaderausbildung | Basel 3 | -- | -- | -- | |||||
Novartis-Mitarbeiterbeteiligungsstiftung | Basel 3 | -- | -- | -- | |||||
Novartis Stiftung für Mensch und Umwelt | Basel 3 | -- | -- | -- | |||||
Stiftung der Novartis AG für Erziehung, Ausbildung und Bildung | Basel 3 | -- | -- | -- | |||||
Novartis Overseas Investments AG | Basel | CHF | 1.0 | m | 100% | ||||
Japat AG | Basel | CHF | 50 000 | 100% | |||||
Novartis Pharma AG | Basel 2 | CHF | 350.0 | m | 100% | ||||
Novartis Pharma Services AG | Basel | CHF | 20.0 | m | 100% | ||||
Novartis Pharma Schweizerhalle AG | Muttenz | CHF | 18.9 | m | 100% | ||||
Novartis Pharma Stein AG | Stein | CHF | 251 000 | 100% | |||||
Novartis Pharma Schweiz AG | Risch | CHF | 5.0 | m | 100% | ||||
Cellerys AG | Zûrich | CHF | 129 630 | 20% | |||||
Arctos Medical AG | Bern | CHF | 360 020 | 100% | |||||
Novartis Ophthalmics AG | Fribourg | CHF | 100 000 | 100% | |||||
Advanced Accelerator Applications International SA | Geneva | CHF | 9.3 | m | 99.23% | ||||
Sandoz AG | Basel | CHF | 5.0 | m | 100% | ||||
Sandoz Pharmaceuticals AG | Risch | CHF | 100 000 | 100% | |||||
As at December 31, 2021 | Share capital1 | Equity interest | |||||||
Taiwan | |||||||||
Novartis (Taiwan) Co., Ltd. | Taipei | TWD | 170.0 | m | 100% | ||||
Thailand | |||||||||
Novartis (Thailand) Limited | Bangkok | THB | 302.0 | m | 100% | ||||
Turkey | |||||||||
Novartis Saglik, Gida ve Tarim Ürünleri Sanayi ve Ticaret A.S. | Istanbul | TRY | 98.0 | m | 100% | ||||
Farmanova Saglik Hizmetleri Ltd. Sti. | Istanbul | TRY | 6.7 | m | 100% | ||||
Sandoz Ilaç Sanayi ve Ticaret A.S. | Istanbul | TRY | 265.0 | m | 99.99% | ||||
Sandoz Grup Saglik Ürünleri Ilaçlari Sanayi ve Ticaret A.S. | Gebze - Kocaeli | TRY | 50.0 | m | 100% | ||||
Ukraine | |||||||||
Sandoz Ukraine LLC | Kyiv | UAH | 8.0 | m | 100% | ||||
United Arab Emirates | |||||||||
Novartis Middle East FZE | Dubai | AED | 7.0 | m | 100% | ||||
United Kingdom | |||||||||
Novartis UK Limited | London | GBP | 25.5 | m | 100% | ||||
Novartis Pharmaceuticals UK Limited | London | GBP | 5.4 | m | 100% | ||||
Novartis Grimsby Limited | London | GBP | 250.0 | m | 100% | ||||
Advanced Accelerator Applications (UK & Ireland) | London | GBP | 100 | 99.23% | |||||
Neutec Pharma Limited | London | GBP | 7.7 | m | 100% | ||||
Ziarco Group Limited | London | GBP | 3 904 | 100% | |||||
Sandoz Limited | Frimley / Camberley | GBP | 2.0 | m | 100% | ||||
Coalesce Product Development Limited | Cambridge, Cambs | GBP | 6.0 | m | 40% | ||||
United States of America | |||||||||
Novartis Corporation | East Hanover, NJ | USD | 72.2 | m | 100% | ||||
Novartis Finance Corporation | East Hanover, NJ 2 | USD | 1 000 | 100% | |||||
Novartis Capital Corporation | East Hanover, NJ | USD | 1 | 100% | |||||
Novartis Services, Inc. | East Hanover, NJ | USD | 1 | 100% | |||||
Novartis US Foundation | East Hanover, NJ 3 | -- | -- | -- | |||||
Novartis Pharmaceuticals Corporation | East Hanover, NJ 2 | USD | 650 | 100% | |||||
Advanced Accelerator Applications USA, Inc. | Millburn, NJ | USD | 1 | 99.23% | |||||
Novartis Gene Therapies, Inc. | Bannockburn, IL | USD | 1 | 100% | |||||
Novartis Technology LLC | East Hanover, NJ | -- | -- | -- | |||||
Novartis Institutes for BioMedical Research, Inc. | Cambridge, MA | USD | 1 | 100% | |||||
Kedalion Therapeutics, Inc. | Menlo Park, CA | USD | 26.1 | m | 23.4% | ||||
Novartis Optogenetics Research, Inc. | East Hanover, NJ | USD | 1 | 100% | |||||
Cadent Therapeutics | Cambridge, MA | USD | 0.1 | 100% | |||||
CoStim Pharmaceuticals Inc. | Cambridge, MA | USD | 1 | 100% | |||||
Endocyte, Inc. | East Hanover, NJ | USD | 1 | 100% | |||||
Navigate BioPharma Services, Inc. | Carlsbad, CA | USD | 1 | 100% | |||||
The Medicines Company | East Hanover, NJ | USD | 1 000 | 100% | |||||
Sandoz Inc. | Princeton, NJ | USD | 25 000 | 100% | |||||
Amblyotech Inc. | East Hanover, NJ | USD | 50 | 100% | |||||
Oriel Therapeutics, Inc. | Durham, NC | USD | 50.0 | m | 100% | ||||
Fougera Pharmaceuticals Inc. | Melville, NY | USD | 1 | 100% | |||||
Eon Labs, Inc. | Princeton, NJ | USD | 1 | 100% | |||||
Novartis Vaccines and Diagnostics, Inc. | East Hanover, NJ | USD | 3 | 100% | |||||
Venezuela | |||||||||
Novartis de Venezuela, S.A. | Caracas | VES | 0 | 100% | |||||
Vietnam | |||||||||
Novartis Vietnam Company Limited | Ho Chi Minh City | VND | 70 | bn | 100% | ||||
In addition, the Group is represented by subsidiaries and associated companies with total assets or net sales to third parties below USD 25 million in the following countries: Bosnia and Herzegovina, Bulgaria, Dominican Republic, Ghana, Guatemala, Ivory Coast, Kenya, Kuwait, North Macedonia, Nigeria, Puerto Rico, Senegal and Uruguay | |||||||||
1 Share capital may not reflect the taxable share capital and does not include any paid-in surplus. | |||||||||
2 Significant subsidiary under SEC Regulation S-X Rule 1-02(w) | |||||||||
3 Fully consolidated Foundation | |||||||||
m = million; bn = billion |
Report of Independent Registered Public Accounting Firm