Press Release: Novartis PKC412 (midostaurin) -2-

Novartis International AG / Novartis PKC412 (midostaurin) pivotal data published in NEJM show 60% response rate in advanced systemic mastocytosis (SM) . Processed and transmitted by Nasdaq OMX Corporate Solutions. The issuer is solely responsible for the content of this announcement.

-- In the largest and longest-running prospective trial in advanced SM, 60% of patients achieved complete or partial resolution of organ damage[1]

-- Advanced SM is rare and has a poor prognosis[2],[3]; currently, there is no approved treatment for the majority of patients[4],[5]

-- Data are further evidence of potential benefit in rare blood cancers; regulatory submissions for advanced SM and acute myeloid leukemia are underway

Basel, June 29, 2016 - Novartis announced today that The New England Journal of Medicine (NEJM) published data for PKC412 (midostaurin) demonstrating an overall response rate, defined as a major or partial response, of 60% (95% confidence interval [CI], 49-70%; P<0.001) in patients with advanced systemic mastocytosis (SM). The median duration of response for all responders in the primary efficacy population was 24.1 months (95% CI, 10.8-not estimated [NE])[1].

Advanced SM is a rare disease characterized by the accumulation of abnormal mast cells, a type of white blood cell, in the bone marrow, liver, spleen and other organs, leading to organ damage. It is also characterized by frequent activating mutations of the KIT gene[5]. Patients with advanced SM have a poor prognosis, with overall survival varying between less than 6 months to 3.5 years, depending on subtype[2], [3], and currently there is no approved treatment for the majority of patients[4],[5].

The pivotal Phase II study, CPKC412D2201, was the largest and longest-running prospective trial ever conducted in this rare disorder. Jason Gotlib, MD, of Stanford University School of Medicine and Stanford Cancer Institute, served as lead author of the study, which enrolled 116 people with advanced SM. Eligibility and responses were reviewed by a Study Steering Committee and 89 patients were eligible for inclusion in the primary efficacy population. Patients received single-agent, oral PKC412 (midostaurin) until disease progression or unacceptable toxicity. Results demonstrated a median overall survival (OS) of 28.7 months (95% CI, 18.1-NE). Improvements in both bone marrow mast cell burden and serum tryptase levels - a marker for mast cell burden - were seen in 78% of patients, and were associated with disease regression[1].

"These data show clear disease and symptom improvement with oral midostaurin treatment across a range of study participants who were reflective of the heterogeneity of this disease," said Professor Andreas Reiter, Department of Hematology and Oncology, University Hospital Mannheim of the University of Heidelberg, Germany and senior author of the study. "If approved, midostaurin will offer patients a much needed treatment option."

The most frequent side effects were gastrointestinal. With the exception of nausea and vomiting, all 32 symptoms self-reported with the Memorial Symptom Assessment Scale significantly decreased with treatment (P<0.001). Quality of life, assessed by the 12-item Short Form Health Survey (SF-12), was also significantly increased with PKC412 (midostaurin) treatment, compared to baseline values: improvement was shown by a 26% (P<0.001) increase in mental health scores and a 29% (P<0.001) increase in physical health scores[1].

"Patients with advanced SM are part of a very small, highly underserved community that has suffered from a lack of medical innovation for many years," said Alessandro Riva, MD, Global Head, Novartis Oncology Development and Medical Affairs. "Novartis is proud to have developed a treatment that shows benefit for these patients, and is now working with regulatory authorities to make midostaurin available as quickly as possible."

The Phase II study results are also reinforced in a letter published in the same issue of NEJM by the French Reference Centre of Mastocytosis (CEREMAST) regarding a compassionate use program for PKC412 (midostaurin) in advanced SM[6]. After a median follow-up time of 18.5 (3-36) months, the overall response rate to treatment was 71%. After a similar follow-up time, the overall survival (OS) rate was 42.7%, compared with 14.9% in a matched historic control group (P=0.03). A more than twofold higher risk of death was also observed in the control group (HR 2.2; P=0.02)[6]. The most frequent side effects were nausea/vomiting in 89% of patients (leading to failure/discontinuation in 18%), lymphocytopenia in 61% without opportunistic infection and photosensitivity in 25%. The authors concluded that PKC412 (midostaurin) is effective in advanced SM[6].

PKC412 (midostaurin) is an investigational, oral, multi-targeted kinase inhibitor that was recently granted Breakthrough Therapy Designation for adults with newly-diagnosed FLT3-mutated acute myeloid leukemia (AML) by the US Food and Drug Administration (FDA). PKC412 (midostaurin) additionally has orphan drug status in the EU and US for both AML and mastocytosis.

Since PKC412 (midostaurin) is investigational at this time, Novartis opened a Global Individual Patient Program (compassionate use program) to enable PKC412 (midostaurin) access to pediatric and adult patients presenting with aggressive systemic mastocytosis (ASM), mast cell leukemia (MCL) or mast cell sarcoma (MCS). Physicians who wish to request PKC412 (midostaurin) for eligible patients should contact a Novartis medical representative in their respective countries. In the US, patients can call 1-888-NOW-NOVA (1-888-669-6682) for more information.

Additional information about the Phase II study

The Phase II, single arm, open-label study of adults (18 years and older) included the following subtypes of advanced SM in the primary efficacy population: aggressive systemic mastocytosis (ASM, N=16), mast cell leukemia (MCL, N=16) and SM with an associated hematologic neoplasm (SM-AHN, N=57)[1].

A key secondary endpoint of the study was OS, which varied between subtypes: 20.7 months (95% CI, 16.0-44.4) in patients with SM-AHN and 9.4 months (95% CI, 7.5-NE) in patients with MCL. Median overall survival in patients with ASM was not reached at the time of analysis (95% CI, 28.7 months-NE). Median progression-free survival (PFS) was longer in those with ASM (28.7 months, 95% CI, 24.8-NE) than in those with SM-AHN (11.0 months, 95% CI, 7.4-17.0) and MCL (11.3 months, 95% CI, 2.8-NE)[1].

The most frequent non-hematologic adverse events (>=50%) were nausea (79%), vomiting (66%) and diarrhea (54%). The most frequent Grade 3/4 non-hematologic adverse events (>=8%) were fatigue (9%) and diarrhea (8%). Dose reduction for toxicity occurred in 56% of patients[1].

For more information on the trial, visit clinicaltrials.gov (NCT00782067).

About systemic mastocytosis

Systemic mastocytosis (SM) comprises a group of rare diseases, affecting between 1 in 20,000 to 40,000 people worldwide[7], whereby uncontrolled growth and accumulation of mast cells occurs in one or more organs[5]. The uncontrolled proliferation of mast cells is caused in many people by a KIT gene mutation - the most common mutation, encoding the D816V substitution, occurs in approximately 90% of patients[8]. The KIT gene mutation results in activation of the KIT enzyme, which triggers the abnormal proliferation and survival of mast cells[7],[9].

In advanced SM, the uncontrolled growth of neoplastic mast cells causes organ damage (e.g. liver dysfunction), low blood counts and weight loss. Patients also suffer from debilitating systemic symptoms such as pruritus (severe itching of the skin) caused by mast cells releasing inflammatory mediators such as histamine into the blood[5].

Advanced SM includes the subtypes aggressive systemic mastocytosis (ASM), mast cell leukemia (MCL) and SM with an associated hematologic neoplasm (SM-AHN)[4]. Median overall survival is 3.5 years, less than 6 months and 2 years, for ASM, MCL and SM-AHN, respectively[2],[3].

About PKC412 (midostaurin)

PKC412 (midostaurin) is an investigational, oral, multi-targeted kinase inhibitor (targeting both wild type KIT and the KIT D816V mutation, among others), in development for the treatment of patients with AML with a FLT3 mutation, as well as patients with advanced SM. The safety and efficacy profile has not been fully established. There is no guarantee that PKC412 (midostaurin) will become commercially available.

Disclaimer

The foregoing release contains forward-looking statements that can be identified by words such as "currently," "potential," "underway," "will, " "working," "investigational," "Breakthrough Therapy," or similar terms, or by express or implied discussions regarding potential marketing approvals for PKC412 (midostaurin), or regarding potential future revenues from PKC412. 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 PKC412 will be submitted or approved for sale in any market, or at any particular time. Nor can there be any guarantee that PKC412 will be commercially successful in the future. In particular, management's expectations regarding PKC412 could be affected by, among other things, the uncertainties inherent in research and development, including unexpected clinical trial results and additional analysis of existing clinical data; unexpected regulatory actions or delays or (MORE TO FOLLOW) Dow Jones Newswires

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-2 of 2- 29 Jun 2016 21:00:00 UTC  Press Release: Novartis PKC412 (midostaurin) -2-
government regulation generally; the company's ability to obtain or maintain proprietary intellectual property protection; general economic and industry conditions; global trends toward health care cost containment, including ongoing pricing pressures; unexpected safety, quality or manufacturing issues, 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 this press release as of this date and does not undertake any obligation to update any forward-looking statements contained in this press release as a result of new information, future events or otherwise.

About Novartis

Novartis provides innovative healthcare solutions that address the evolving needs of patients and societies. Headquartered in Basel, Switzerland, Novartis offers a diversified portfolio to best meet these needs: innovative medicines, eye care and cost-saving generic pharmaceuticals. Novartis is the only global company with leading positions in these areas. In 2015, the Group achieved net sales of USD 49.4 billion, while R&D throughout the Group amounted to approximately USD 8.9 billion (USD 8.7 billion excluding impairment and amortization charges). Novartis Group companies employ approximately 118,000 full-time-equivalent associates. Novartis products are available in more than 180 countries around the world. For more information, please visit http://www.novartis.com.

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References

[1] Gotlib J, Kluin-Nelemans HC, George TI, et al. Efficacy and Safety of Midostaurin in Advanced Systemic Mastocytosis. N Engl J Med. 2016;374(26):2530-2541.

[2] Lim KH, Tefferi A, Lasho, et al. Systemic mastocytosis in 342 consecutive adults: survival studies and prognostic factors. Blood. 2009;113:5727-5736.

[3] Georgin-Lavialle S, Lhermitte L, Dubreuil P, et al. Mast cell leukemia. Blood. 2013;121(8):1285-1295.

[4] Arock M, Akin C, Hermine O. Current treatment options in patients with mastocytosis: status in 2015 and future. European Journal of Haematolgy. 2015;94(6):474-90.

[5] Verstovsek S. Advanced systemic mastocytosis: the impact of KIT mutations in diagnosis, treatment, and progression. Eur J Haematol. 2013;90(2):89-98.

[6] Chandesris MO, Damaj G, Hermine O, et al. Midostaurin in advanced systemic mastocytosis. N Engl J Med. 2016;374(26):2605-2606.

[7] Orpha.net. Systemic Mastocytosis. http://www.orpha.net/consor/cgi-bin/OC_Exp.php?Expert=2467. Accessed March 2016.

[8] Garcia-Montero AC, Jara-Acevedo M, Teodosi C, et al. KIT mutation in mast cells and other bone marrow hematopoietic cell lineages in systemic mast cell disorders: a prospective study of the Spanish Network on Mastocytosis (REMA) in a series of 113 patients. Blood. 2006;108(7):2366-2372.

[9] Kristensen T, Vestergaard H, Møller MB. Improved detection of the KIT D816V mutation in patients with systemic mastocytosis using a quantitative and highly sensitive real-time qPCR assay. J Mol Diagn. 2011;13(2):180-8.

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