Novartis provides update on regulatory developments regarding its pending acquisitions of Hexal AG and Eon Labs

Basel, April 08, 2005 - Novartis announced today that it has made submissions to European and US regulatory authorities seeking approval to acquire the generic pharmaceutical companies Hexal AG of Germany and Eon Labs, Inc. of the US.

 

Novartis filed on April 4, 2005, for European Commission approval under the Merger Control Regulation for the acquisition of privately-held Hexal AG.

 

A submission for US regulatory approval was made on March 7, 2005. Novartis received a request on April 6, 2005, for additional information (commonly referred to as a "second request") from the US Federal Trade Commission. Such a request is not unusual in transactions of this size and nature in the pharmaceutical industry. The effect of this second request is to extend the waiting period imposed by the Hart-Scott-Rodino Antitrust Improvements Act of 1976 until 30 days after Novartis and Eon have substantially complied with the request, unless that period is extended voluntarily by the parties or terminated sooner by the FTC.

 

The tender process to acquire the publicly-held shares of Eon Labs is planned to start in coordination with the regulatory process.

 

This document contains "forward-looking statements" within the meaning of the US Private Securities Litigation Reform Act.  Forward-looking statements are statements that are not historical facts and are generally identified by the words "expects", "anticipates", "believes", "intends", "estimates", "will", or similar expressions, or by express or implied discussions regarding strategies, plans and expectations (including synergies).  These statements include, but are not limited to, financial projections and estimates and their underlying assumptions, statements regarding the benefits of the business transactions described herein, including future financial and operating results. Such statements reflect the current plans, expectations, objectives, intentions or views of management with respect to future events, are based on the current beliefs and expectations of management and are subject to significant risks, uncertainties and assumptions.  Management's expectations could be affected by, among other things, competition in general, the general economic environment and other risks such as, but not limited to, those referred to in Novartis AG's Form 20-F on file with the U.S. Securities and Exchange Commission.  Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may differ materially from those set forth or implied by the forward-looking statements.

 

The following factors, among others, could cause actual results to differ materially from those set forth in the forward-looking statements: the ability to obtain governmental approvals for the transaction on the proposed terms and schedule; the risk that the businesses will not be integrated successfully; the risk that the cost savings and any other synergies from the transaction may not be fully realized or may take longer to realize than expected; disruption from the transaction making it more difficult to maintain relationships with customers, employees or suppliers; social and political conditions such as war, political unrest and terrorism or natural disasters; and general economic conditions and normal business uncertainty and competition and its effect on pricing, spending, third-party relationships and revenues.  These forward-looking statements speak only as of the date of this press release and no undertaking has been made to update or revise them if there are changes in expectations or if any events, conditions or circumstances on which any such forward looking statement is based.

 

Securityholders of Eon are urged to read the tender offer statement relating to the tender offer when such document becomes available. The tender offer statement will contain important information. n Securityholders will be able to obtain a free copy of the tender offer statement and other filed documents when they become available at the SEC's internet site (http://www.sec.gov).

 

Novartis AG (NYSE: NVS) is a world leader in pharmaceuticals and consumer health. In 2004, the Group's businesses achieved sales of USD 28.2 billion and a net income of USD 5.8 billion. The Group invested approximately USD 4.2 billion in R&D. Headquartered in Basel, Switzerland, Novartis Group companies employ approximately 81,400 people and operate in over 140 countries around the world. Further information is available at www.novartis.com.

 

Sandoz, a Novartis company, is a world leader in generic pharmaceuticals and develops, manufactures and markets these medicines as well as pharmaceutical and biotechnological active ingredients. Decades of experience and know-how make Sandoz a renowned partner in pharmaceuticals, biogenerics and industrial products.  Altogether, Sandoz employs approximately 13,000 people in over 110 countries and reported sales of USD 3.0 billion in 2004.

 

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John Gilardi
Novartis Global Media Relations
+41 61 324 3018 (direct)
+41 61 324 2200 (main)
john.gilardi@novartis.com

 

Kurt Leidner
Sandoz Communications
+43 1 260 68 9611 (direct)
+43 1 260 680 (main)