Novartis completes acquisition of 98% of Eon Labs, substantially strengthening the leading position of its Sandoz generics unit

21. 7. 2005

Basel, July 21, 2005 – Novartis announced today that it has completed the acquisition of approximately 98% of US-based generic pharmaceutical company Eon Labs, Inc. Following the acquisition last month of Hexal AG of Germany, the Sandoz generics division of Novartis now has a strong foothold and a leading position in the highly competitive generic drug industry.

“With the combined strengths of the three companies – Sandoz’ global presence and expertise in anti-infectives, Hexal’s leadership in Germany and solid record of successful product development, and Eon Labs’ leading position in the US for ‘difficult-to-make’ generics – we are well positioned for sustained growth,” said Dr. Andreas Rummelt, CEO of Sandoz.

Sandoz now has a competitive and broad product portfolio with a leading presence in key markets, including the US and Germany, and a portfolio of more than 600 active ingredients in more than 5,000 dosage forms. The combined company employs more than 20,000 people and its global headquarters is located in Holzkirchen, Germany. The acquisitions significantly strengthen Sandoz’ technology base, particularly in the application of transdermal patches, inhalation products, sustained-release implants and multi-particulate drug-delivery dosage forms, and expand the already strong capabilities in biopharmaceuticals.

Drawing on the strengths of Sandoz’ global structures, Hexal’s centrally managed research and development activities and Eon Labs’ strong skill sets, the combined operations aim to achieve more than 80 product approvals per year. Sandoz will market its products under a single brand in most countries with some exceptions, including Germany, where both the Hexal and Sandoz brands will be maintained.

“Our extensive planning has prepared us well to operate as one unified company,” said Dr. Rummelt. All country and function organizations have been defined, and all key management positions have been filled. Business structures have been designed to support Sandoz’ business model as a retail generics company that also operates a business unit with a specific strategic focus on anti-infectives. “Lean management structures will ensure quick decision-making and support the strong entrepreneurial spirit in local markets, a key to our success,” said Dr. Rummelt.

The new Sandoz International management team, under the leadership of Dr. Rummelt, includes top management from all three companies. Dr. Andreas Strüngmann and Dr. Thomas Strüngmann, co-founders of Hexal, have joined the Sandoz Executive Committee. Dr. Andreas Strüngmann is responsible for the regional operations in Europe, Africa and also for Asia-Pacific on an ad-interim basis. Dr. Thomas Strüngmann continues in the position of head of regional operations in Germany, the Americas and Middle East. Dr. Bernhard Hampl, CEO of Eon Labs, will be the head of the US operations of Sandoz and will report to Dr. Thomas Strüngmann.

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, and 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 risk that the businesses will not be integrated successfully; the risk that the cost savings and any other synergies from the transactions may not be fully realized or may take longer to realize than expected; disruption from the transactions 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.

About Novartis
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 pro forma net income of USD 5.6 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

Sandoz, a Novartis company, is a world leader in generic pharmaceuticals and develops, manufactures and markets these medicines as well as pharmaceutical and biopharmaceutical active ingredients. Being a Retail Generics company, Sandoz also operates a Business Unit with specific strategic focus – Anti-Infectives. In 2004, Sandoz employed around 13,400 people worldwide and posted sales of USD 3.0 billion.

Nehl Horton
Novartis Global Media Relations
+41 61 324 5749 ali
+41 61 324 2200


Kurt Leidner
Sandoz Communications
+43 1 260 68 9611 ali
+43 1 260 680