Novartis : ESG Update - July 20, 2022 (PDF 0.4 MB)

CONTENTS

Driving our social impact

Research to drive access to healthcare

Engagement initiatives to drive understanding & focus

MSCI upgrades Novartis to AA

Top 10 ESG-related questions from shareholders and our responses

Q2 2022 ESG Update

for investors and analysts

Dear investors and analysts

In our Q2 ESG update, our focus continues to be on enhancing our impact on society and addressing the inequalities in global healthcare. We highlight a number of new and expanded initiatives to improve access to innovative and necessary healthcare to underserved patients; and also to enhance the sustainability of healthcare systems globally.

As part of our commitment to enhance our impact, we engaged with many of you during our recent ESG roadshows and appreciate your valuable insights. Feedback and questions we received are reflected in the Q&A at the end of the newsletter.

Thank you again for your interest in Novartis.

Samir Shah	Maria Victoria Cuevas	Nicole Zinsli-Somm
Global Head	Investor Relations	Investor Relations
Investor Relations	ESG Director	ESG Director a.i.
[phone]	[phone]	[phone]

CONTENTS

• Driving our social impact

Research to drive access to healthcare

Engagement initiatives to drive understanding & focus

ESG UPDATE Q2 2022 | 2

Driving our social impact

During Q2 we extended our range of new initiatives to enhance our contribution to and impact on global health. Our initiatives build on the key issues identified in our materiality assessments including: access through health systems strengthening; and improving outcomes through innovation.

Access through health systems strengthening

Initiative

Activity

Potential outcome/impact

MSCI upgrades Novartis to AA

Top 10 ESG-related questions from shareholders and our responses

Fighting sickle	A new partnership with the
cell disease in	American Society of Haematology to
Sub-Saharan	fight against sickle cell disease (SCD)
Africa	in Sub-Saharan Africa.
	The Ghanaian government recently
	announced to provide care (newborn
	screening and hydroxyurea) free of
	charge to eligible patients.
	We intend to provide six additional
	African nations with technology to
	document and share the diagnosis
	of babies with SCD.

Driving early diagnosis for babies with SCD is key to promote better health outcomes.

SCD is a life-threatening inherited blood disorder. Over 300,000 children are born with SCD in Africa every year.

Expansion	Launched CancerPath to Care
of Novartis	with the Max Foundation,
collaboration	a global nonprofit which aims
with the Max	to accelerate health equity.
Foundation	Under the expanded program
	patients would have access to
	Novartis treatments for breast
	cancer, and our novel therapy
	for CML, Scemblix®.

CancerPath to Care expects to provide access to care for 36,000 people living with breast and rare cancers in over 70 LMICs by 2025.

Since 2002, Novartis and Max have helped more than 90,000 patients in low and middle income countries with treatment for chronic myeloid leukemia (CML) and other rare cancers.

US National	The US National Institute of Allergy
Institutes of	and Infectious Diseases awarded a
Health supports	$56 million grant to establish one
UTMB-Novartis	of the nine Antiviral Drug Discovery
Alliance	centers in a partnership between
for Pandemic	Novartis and the University of Texas
Preparedness	Medical Branch (UTMB).
	Researchers intend to focus
	on coronaviruses, flavivirus
	and henipavirus.

The UTMB-Novartis Alliance aims to discover antiviral drugs which target viruses with the potential to cause pandemics.

First	In May, the Union for
pharmaceutical	International Cancer Control
company to	established the ATOM coalition.
contribute a	Novartis was announced as a partner
targeted therapy	of the coalition.
to Access
to Oncology
Medicines
(ATOM) Coalition

The ATOM coalition aims to increase access to essential cancer treatments in LMICs.

Novartis is contributing a targeted therapy to this coalition.

Three in four cancer deaths occur in the poorest countries around the world, often due to lack of early diagnosis or care.

CONTENTS

• Driving our social impact

ESG UPDATE Q2 2022 | 3

Innovation on NTDs and clinical trial diversity

Initiative

Activity

Potential outcome/impact

Research to drive access to healthcare

Engagement initiatives to drive understanding & focus

MSCI upgrades Novartis to AA

Support for	We recently reiterated our
NTD and malaria	commitment towards the fight
elimination with	against Malaria and Neglected
$250m investment	Tropical Diseases (NTDs) at
(Kigali Declaration)	the Kigali Summit, announcing
	a contribution of $250 million
	over five years to develop new
	treatments.

By tackling NTDs we aim to reduce poverty, address inequity, strengthen health systems, increase human capital and build resilient communities.

It is estimated that 1.7 billion people globally continue to suffer from NTDs.

Top 10 ESG-related questions from shareholders and our responses

Increasing Diversity	We have increased our
in Clinical Trials in	commitment to the Beacon of
the United States	Hope to $50 million as part of an
(Beacon of Hope)	expanded partnership including
	the increase in clinical trial
	centers from one to four.
	Beacon of Hope is a 10-year
	collaboration with 26 Historically
	Black Colleges, Universities
	and Medical Schools to address
	the root causes of disparities
	in health and education.

The partnership aims to increase the representation of minorities in clinical trials and ensure trials are targeted at those who need it most.

Making progress to empower the next generation of African American and Black students in healthcare.

The programme is open for others and two multinationals have already joined.

CONTENTS

Driving our social impact

• Research to drive access to healthcare

Engagement initiatives to drive understanding & focus

MSCI upgrades

Novartis to AA

ESG UPDATE Q2 2022 | 4

Research to drive access to healthcare

Research:

Virtual Health and Care report to drive greater health access and equity

Top 10 ESG-related questions from shareholders and our responses

Focus

In June, a detailed research report - The Future of Health and Care - driving access and equity through inclusive policies - was published by the Broadband Commission for Sustainable Development Working Group, which was co-chaired by the World Health Organization and the Novartis Foundation.

Methodology

The report analyzed virtual health and care policies in 23 countries.

Conclusions

The report outlines how countries can ensure virtual health and care drives health access and equity.

The report also calls on health decision makers to act to prevent digital divides from increasing health inequities with a specific focus on ensuring equitable and inclusive access to virtual services for entire populations.

Research:

Peer reviewed research paper published to help improve managed access requests

Focus

Managed access requests are made when patients with serious conditions seek medical products that are not yet approved or available in their country.

Novartis published a peer reviewed paper in the Journal of American Medical Association to share our experience on handling these requests.

Methodology

The study analyzed 31,711 managed access requests received in a 36-month period at Novartis.

Conclusions

The study found that the vast majority (87%) of managed access requests came from high-income countries.

Learning from the factors associated with higher request activity could translate into improved access to novel lifesaving products for patients with unmet medical needs.

CONTENTS

Driving our social impact

Research to drive access to healthcare

• Engagement initiatives to drive understanding & focus

MSCI upgrades Novartis to AA

Top 10 ESG-related questions from shareholders and our responses

ESG UPDATE Q2 2022 | 5

Engagement initiatives to drive understanding and focus

2022 ESG Roadshow

Novartis recently completed its 2022 ESG Roadshow, a program which has been in place for the last four years.

We value the active and engaged dialogue on ESG topics from all participants. Engaging with stakeholders on ESG issues fosters mutual understanding of our practices and ensures we can continue to improve our ESG journey.

Klaus Moosmayer (Chief Ethics, Risk and Compliance Officer) and Lutz Hegemann (President, Global Health & Sustainability) participated in our 2022 ESG roadshow with ~70 participants, including investors representing over 20% of our shareholder base, and both equity and credit analysts.

The primary discussion area was how to measure impact - something Novartis is acutely focused on.

Discussions during the roadshow covered a wide range of topics, including:

Access to Healthcare Innovation Addressing inequities in US

Code of Ethics and approach to risk management

Key questions raised are set out at the end of the newsletter.

Following on from this roadshow, our 2022 ESG Investor Day will be held on 30 November, 2022.