Alcon. January 2016 Page 1 of 5 Novartis AG

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1 Alcon Alcon is a global leader in eye care and offers and extensive breadth of products serving the full lifecycle of patient needs across eye diseases, vision conditions and refractive errors. In 2015, Alcon had consolidated net sales of USD 9.8 billion, representing 20% of total Group net sales. To meet the needs of eye care professionals, Alcon operates with three franchises: Surgical, Ophthalmic Pharmaceuticals and Vision Care. Alcon products are available in more than 180 markets. Each franchise operates with specialized sales forces and marketing support. Alcon s dedication to research and development is important to our growth plans. As part of our efforts, Alcon works together with the Novartis Institutes for BioMedical Research (NIBR), our global pharmaceutical research organization. This collaboration enables Alcon to leverage the resources of NIBR in an effort to discover and expand ophthalmic pharmaceutical research targets and to develop chemical and biologic compounds for the potential treatment of diseases of the eye, with a particular focus on conditions such as glaucoma, dry eye, and retinal diseases such as age-related macular degeneration (AMD). Over the past two years, Alcon closed several strategic licensing agreements and acquisitions. In July 2014, Alcon entered into an agreement with Verily, formerly Google Life Sciences, to license its smart lens technology with the potential to address ocular conditions. The smart lens technology involves non-invasive sensors, microchips and other miniaturized electronics, which are within contact lenses. Our interest in this technology is currently focused in two areas: For people living with presbyopia, who can no longer read without glasses, the smart lens has the potential to provide accommodative vision correction to help restore the eye s natural autofocus on near objects in the form of an accommodative contact lens or intraocular lens as part of the refractive cataract treatment. Helping diabetic patients manage their disease by providing a continuous, minimally invasive measurement of the body s glucose levels via a smart contact lens, which is designed to measure tear fluid in the eye and connects wirelessly with a mobile device. In October 2014, Alcon acquired WaveTec Vision. The acquisition provided Alcon with the ORA System, the first commercialized intra-operative guidance system for cataract surgeons implanting intra-ocular lenses (IOLs). January 2016 Page 1 of 5 Novartis AG

2 The ORA System, which complements Alcon s Verion image-guided pre-operative diagnostic system, allows surgeons to see incisions and IOL alignment in real time to support optimal positioning of IOLs during cataract surgery. Alcon Division Products Surgical Our Surgical franchise is the market leader in global ophthalmic surgical product revenues, offering ophthalmic surgical equipment, instruments, disposable products and intraocular lenses for surgical procedures that address cataracts, vitreoretinal conditions, glaucoma and refractive errors. Our Surgical portfolio includes the Cataract Refractive Suite by Alcon, a suite of equipment to help plan and perform some of the most challenging steps of cataract surgery with precision. It is comprised of the Verion image-guided system, an ocular surgical planning, imaging and guidance technology; the ORA System, an intraoperative guidance system for IOL implantation during cataract surgery; the Centurion vision system phacoemulsification technology platform; the LuxOR LX3 surgical microscope for greater visualization during surgery; as well as the LenSx laser, a femtosecond laser for increased precision and reproducibility for the corneal incision, capsulorhexis and lens fragmentation steps of cataract surgery. The Surgical portfolio also includes Contoura vision, the latest vision system in the Wavelight portfolio for refractive procedures and LASIK treatments; the Constellation vision system for retinal operations; and the Infiniti vision system to perform cataract surgeries. Alcon also offers the AcrySof family of intraocular lenses (IOLs) to treat cataracts and other pre-existing conditions such as astigmatism and presbyopia. Products in the AcrySof family include the AcrySof IQ, AcrySof IQ ReSTOR, AcrySof IQ Toric and AcrySof IQ ReSTOR Toric, AcrySof PanOptix and the AcrySof with UltraSert delivery system IOLs. In addition, Alcon provides advanced viscoelastics, surgical solutions, surgical packs and other disposable products for cataract and vitreoretinal surgeries. Ophthalmic Pharmaceuticals Our Ophthalmic Pharmaceuticals franchise develops and markets a broad range of pharmaceuticals to treat chronic and acute conditions of the eye, including elevated intraocular pressure or IOP (associated with glaucoma), eye infection and January 2016 Page 2 of 5 Novartis AG

3 inflammation, eye allergies, dry eye, and retinal conditions and diseases. Ophthalmic Pharmaceuticals also oversees the line of professionally driven over-the-counter (OTC) brands that include artificial tears and ocular vitamins. Product highlights within Alcon s Ophthalmic Pharmaceuticals portfolio include Ilevro ophthalmic suspension for the treatment of pain and inflammation associated with cataract surgery; Nevanac ophthalmic suspension for eye pain and inflammation following cataract surgery and to reduce the risk of macular edema associated with cataract surgery; Durezol emulsion for the treatment of inflammation and pain associated with ocular surgery and endogenous anterior uveitis; Simbrinza suspension to lower intraocular pressure as a fixed-dose combination; Travatan Z and DuoTrav ophthalmic solutions and Azarga ophthalmic suspension, each for the treatment of elevated intraocular pressure (IOP) associated with open-angle glaucoma or ocular hypertension; Vigamox and Moxeza ophthalmic solutions, each for bacterial conjunctivitis; Pazeo and Pataday ophthalmic solutions for the treatment of ocular itching associated with allergic conjunctivitis; Ciprodex otic drops for middle ear and outer ear canal infections; Jetrea intravitreal injection for treating vitreomacular traction, or VMT, including when associated with macular hole of diameter less than or equal to 400 microns; and the Systane family of over-the-counter products for dry eye relief. Vision Care Our Vision Care franchise develops and markets contact lenses and lens care products. Alcon s broad portfolio of silicone hydrogel, daily disposables and color contact lenses includes our Air Optix, Dailies and Freshlook brands. Our Dailies product line includes Dailies Total1 lenses, a first-of-its-kind water gradient contact lens. Our Air Optix product line of monthly wear lenses includes Air Optix Colors silicone hydrogel contact lenses. Our contact lens care solutions business includes the Opti-Free line of multi-purpose disinfecting lens care solutions and drops, as well as the Clear Care and AOSept Plus hydrogen peroxide lens care solutions. New Products In 2015 AcrySof IQ aspheric intraocular lens with UltraSert Pre-loaded Delivery System was approved in the US and EU to provide a single-use system for cataract surgery. January 2016 Page 3 of 5 Novartis AG

4 AcrySof IQ PanOptix trifocal intraocular lens was launched in the EU for patients seeking presbyopia-correction during cataract surgery. AcrySof IQ ReSTOR multifocal +2.5D intraocular lens was approved in the US for patients wanting near, intermediate and distance vision correction during cataract surgery. Air Optix Colors contact lenses: silicone hydrogel, color cosmetic monthly contact lenses were launched in Japan. Air Optix Colors contact lenses in plus powers were launched in the US for patients with hyperopia. Air Optix with HydraGlyde contact lenses received approval in the EU for longerlasting surface wettability. Clear Care Plus/AOSept Plus with HydraGlyde was launched in the US and EU to provide hydrogen peroxide-based cleaning and disinfecting for contact lenses. Contoura vision topography guided, refractive surgical system was launched in the US for patients seeking myopic and astigmatic vision correction. Dailies Total1 contact lenses with plus powers were launched in the US and EU for patients with hyperopia seeking a daily disposable lens. LuxOr ceiling-mounted ophthalmic microscope system gained approval in the US for enhanced visualization during cataract surgery. ORA System with VerifEye+ was launched in the US and EU for enhanced preoperative planning during cataract surgery. Pazeo Solution (olopatadine hydrochloride) for 24-hour ocular allergy itch relief was approved and launched in the US. Systane Hydration lubricant eye drops in unit-dose and multi-dose were launched in the EU for the palliative treatment of dry eye. January 2016 Page 4 of 5 Novartis AG

5 Disclaimer These materials contain forward-looking statements that can be identified by terminology such as such as potential, expected, will, planned, or similar expressions, or by express or implied discussions regarding potential new products, potential new indications for existing products, or regarding potential future revenues from any such products; potential shareholder returns or credit ratings; or regarding any potential financial or other impact on Novartis or any of our divisions of the strategic actions announced in January 2016 to focus our divisions, integrate certain functions and leverage our scale; or regarding any potential financial or other impact on Novartis as a result of the creation and operation of NBS; or regarding the potential financial or other impact on Novartis of the transactions with GSK, Lilly or CSL; or regarding potential future sales or earnings of the Novartis Group or any of its divisions; or by discussions of strategy, plans, expectations or intentions. You should not place undue reliance on these statements. Such forward-looking statements are based on the current beliefs and expectations of management regarding future events, and are subject to significant known and unknown risks and uncertainties. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those set forth in the forward-looking statements. There can be no guarantee that any new products will be approved for sale in any market, or that any new indications will be approved for any existing products in any market, or that any approvals which are obtained will be obtained at any particular time, or that any such products will achieve any particular revenue levels. Nor can there be any guarantee that Novartis will be able to realize any of the potential strategic benefits, synergies or opportunities as a result of the strategic actions announced in January 2016, the creation and operation of NBS, or the transactions with GSK, Lilly and CSL. Neither can there be any guarantee that Novartis or any of the businesses involved in the transactions will achieve any particular financial results in the future. Neither can there be any guarantee that shareholders will achieve any particular level of shareholder returns. Nor can there be any guarantee that the Group, or any of its divisions, will be commercially successful in the future, or achieve any particular credit rating. In particular, management s expectations could be affected by, among other things: unexpected regulatory actions or delays or government regulation generally; the potential that the strategic benefits, synergies or opportunities expected from the strategic actions announced in January 2016, the creation and operation of NBS, or the transactions with GSK, Lilly and CSL may not be realized or may take longer to realize than expected; the inherent uncertainties involved in predicting shareholder returns or credit ratings; the uncertainties inherent in research and development, including unexpected clinical trial results and additional analysis of existing clinical data; our ability to obtain or maintain proprietary intellectual property protection, including the ultimate extent of the impact on Novartis of the loss of patent protection and exclusivity on key products which commenced in prior years and will continue this year; unexpected safety, quality or manufacturing issues; global trends toward health care cost containment, including ongoing pricing pressures, in particular from increased publicity on pharmaceuticals pricing; uncertainties regarding actual or potential legal proceedings, including, among others, actual or potential product liability litigation, litigation and investigations regarding sales and marketing practices, government investigations and intellectual property disputes; general economic and industry conditions, including uncertainties regarding the effects of the persistently weak economic and financial environment in many countries; uncertainties regarding future global exchange rates, including the continued significant increase in value of the US dollar, our reporting currency, against a number of currencies; uncertainties regarding future demand for our products; uncertainties involved in the development of new healthcare products; uncertainties regarding potential significant breaches of data security or disruptions of our information technology systems; and other risks and factors referred to in Novartis AG s current Form 20-F on file with the US Securities and Exchange Commission. Novartis is providing the information in these materials as of this date and does not undertake any obligation to update any forward-looking statements as a result of new information, future events or otherwise. All product names appearing in italics are trademarks owned by or licensed to Novartis Group Companies. January 2016 Page 5 of 5 Novartis AG

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