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Novartis in Society Report 2018 UNCTAD Illicit Trade Forum 3rd to 4th February 2020 Room XXVI, Palais des Nations, Geneva Report - Novartis in Society Contribution by Novartis The views expressed are those of the author and do not necessarily reflect the views of UNCTAD Novartis in Society 2018 CONTENTS Novartis in Society 2018 | 2 Contents 2018 highlights 3 Who we are 4 What we do 6 Message from the CEO 8 Global Health & Corporate Responsibility at Novartis 9 Strategic areas 13 Holding ourselves to the highest ethical standards 13 Being part of the solution on pricing and access 18 Addressing global health challenges 29 Being a responsible citizen 35 About this report 46 Performance indicators 2018 47 Novartis GRI Content Index 51 Appendix: corporate responsibility material topic boundaries 55 Appendix: corporate responsibility materiality assessment issue cluster and topic definitions 56 Appendix: external initiatives and membership of associations 58 Appendix: supplier spend 2018 59 Appendix: measuring and valuing our impact 59 Independent Assurance Report on the Novartis 2018 corporate responsibility reporting 60 Cover photo Mukamudenge Melaniya, a potter living in rural Rwanda, receives treatment for malaria and other ailments at a local healthcare outpost run by a nurse entrepreneur and affiliated with One Family Health, a nongovernmental organization. 2018 HIGHLIGHTS Novartis in Society 2018 | 3 2018 highlights ETHICAL STANDARDS 54 % 100 + 220 REDUCTION PEOPLE COUNTRY VISITS in the number of reported complaints added to the Integrity & Compliance conducted by the Integrity & of fraud and professional practices in function in recent years Compliance function in 2018 the sales force in 2018 vs. 2017 ACCESS TO HEALTHCARE No. 2 24 m 17 m RANKING PATIENTS PEOPLE in the 2018 Access to Medicine Index, reached through access programs reached through training, up from third position in 2016 health education and service delivery programs GLOBAL HEALTH USD 100 m ~900 m 7.2 m INVESTMENT TREATMENT COURSES PATIENTS REACHED committed over the next five years to of Coartem delivered without with free multidrug therapy advance R&D of new antimalarials profit to date for leprosy since 1999 CORPORATE CITIZENSHIP No. 2 140+ 50% RANKING SUCCESSFUL REDUCTION in the 2018 Thomson Reuters ENFORCEMENT CASES in our carbon footprint, including our Diversity & Inclusion Index, initiated or supported to combat supply chain, by 2030 (vs. 2016) up from sixth in 2017 falsified and counterfeit medicines 4WHO | Novartis WE ARE Annual Review 2018 Novartis in Society 2018 | 4 4 | Novartis Annual Review 2018 WhoWho we wewe are are are OurOur purposepurpose WeWe reimagine medicine medicine to to improve improve and and extend extend people’s people’s lives. lives. WeWe use innovative science science and and technology technology to toaddress address some some ofof society’s mostmost challenging challenging healthcare healthcare issues. issues. We We discover discover andand develop breakthrough breakthrough treatments treatments and and find find new new ways ways to deliverto deliver themthem to asas manymany people people as as possible. possible. We We also also aim aim to rewardto reward those those whowho invest theirtheir money, money, time time and and ideas ideas in inour our company. company. Our company RESEARCH AND Our company DEVELOPMENTRESEARCH (R&D) AND DEVELOPMENT (R&D) INNOVATIVE MEDICINES The Novartis Institutes for BioMedicalThe Novartis Research Institutes TheINNOVATIVE Innovative MEDICINES Medicines (NIBR)for is BioMedical the innovation Research TheDivision Innovative has two Medicines business units: engine(NIBR) of Novartis. is the innovationNIBR Division has two business units: focuses on discovering Novartis Oncology engine of Novartis. NIBR Novartis Oncology focuses on new drugsfocuses that on can discovering change Novartis Oncology the practice of medicine. Novartispatented Oncology treatments focuses for a variety on new drugs that can change the practice of medicine. patentedof cancers treatments and rare diseases. for a variety als The Global Drug tic of cancers and rare diseases. u Development (GDD) ce als The Global Drug Novartis Pharmaceuticals a ic B organization oversees ut u Novartis Pharmaceuticals rm e si Development (GDD) Novartis Pharmaceuticals a c s ne the development of new focuses on patented treat - h a n Bu s organization oversees P m io ss medicines discovered by Novartis Pharmaceuticals r t in ments in the areas of a c s se the development of new h n n e our researchers and focuses on patented treat - o sr ophthalmology; immunology, P u i vs medicines discovered by f t partners. i s ments in the areas of c c hepatology and dermatology; e n e our researchers and t e r ophthalmology; immunology, u v neuroscience; respiratory; a f s partners. r i c hepatology and dermatology; ( o e and cardio-metabolic. N t e NOVARTIS TECHNICAL p neuroscience; respiratory; a B s r r OPERATIONS (NTO) S o ( o and cardio-metabolic. N ) NOVARTIS TECHNICAL C y p handles manu fac tu ring of SANDOZ B g r OPERATIONS (NTO) o S o innovative medicines and Sandoz offers patients l ) o C y Sandozhandles products. manu NTO fac tuhelps ring of SANDOZ c g and healthcare profes sionals n o us optimizeinnovative resource medicines allo- and Sandozhigh-quality, offers affordable patients O l S o cation and capacity planning a c Sandoz products. NTO helps andgenerics healthcare and biosimilars. profes sionals n d n acrossus our optimize pro duction resource sites. allo- high-quality, affordable o O S z M cation and capacity planning generics and biosimilars. a a ) ALCON n nu TO across our pro duction sites. d fac (N NOVARTIS BUSINESS o turing With its Surgical and Vision Care z M SERVICES (NBS) a ) businesses,ALCON Alcon offers one of nA TO consolidates support ulcfoan (N NOVARTIS BUSINESS the world’s widest selections of cturing services across our organi- With its Surgical and Vision Care SERVICES (NBS) eye care devices – from sophisti- zation, helping drive effi- businesses, Alcon offers one of cated equipment for delicate eye Alcon ciency,consolidates simplification, support stan- thesurgery, world’s to awidest wide portfolio selections of of dardization services and across quality. our organi- eyeadvanced care devices contact – lenses. from sophisti- zation, helping drive effi- cated equipment for delicate eye ciency, simplification, stan- CORPORATE FUNCTIONS surgery,In 2018, Novartisto a wide announced portfolio of the dardization and quality. advancedintention to contact spin off lenses. Alcon, Corporate functions support pending approval from share- the enterprise in specific CORPORATE FUNCTIONS Inholders 2018, andNovartis regulators. announced the areas of expertise, including intention to spin off Alcon, finance,Corporate human resources,functions support pending approval from share- legal theand enterprisecommunications. in specific holders and regulators. areas of expertise, including finance, human resources, legal and communications. WhO WE aRE Novartis Annual Review 2018 | 5 WHO WE ARE Novartis in Society 2018 | 5 Who we are Our culture Our values Curious Innovation Performance Inspired Quality Courage Unbossed Collaboration Integrity Our people The greatest strength of Novartis is our people, whose diversity, energy and creativity are crucial to our success. HEADCOUNT NATIONALITIES 129 924 147 ANNUAL TRAINING WOMEN HOURS PER EMPLOYEE IN MANAGEMENT 22.6 42 % R&D R&D n n io o t ti u u ib b r i t r s t i WHAT WE DO s Novartis in Society 2018 | 6 6 | Novartis Annual Reviewi 2018 D D C g C o n o i m r m u m t g m c e n r ri e fa c rc u ia tu n li c ia a za fa liz M What weti donu at What weo do n Ma ion Our business model RESOURCES WE USE WHAT WE DO THE VALUE WE CREATE R R&D &D on Talented people ti R u & n n ib D o Improved health and io tr i t s t u i u well-being for people b Financialib capital D i r r t t s s i Access to medicine i D IntellectualD capital and healthcare Shareholder returns C Natural capital o g g C C m n n o i o i m r r m Jobs m u g u t e t Technologym r in m c c r c e a i u e fa r f a t rc u c u li c i Taxes paid n ia n za fa a a li a t u liz M Infrastructureza & facilities M io an at tion n M ion Our products and reach We develop and produce innovative medicines We also offer about 1 000 generic medicines to address patient needs in disease areas where and biosimilars covering major thera peutic our experience and knowledge have the poten- areas. They can bring substantial savings to tial to produce transformative treatments. patients and healthcare systems, and help improve access to healthcare. ONCOLOGY RESPIRATORY NEUROSCIENCE PILLS INJECTIONS INHALERS CARDIOVASCULAR IMMUNOLOGY INFECTIOUS AND METABOLISM HEPATOLOGY DISEASES DERMATOLOGY OPHTHAL MO LOGY 155 817 m 24 m COUNTRIES PATIENTS PATIENTS where Novartis reached in total reached through products are sold access programs WHATWhat WWEE dDOO NovartisNovartis Annual in Review Society 2018 2018 | 7| 7 What we do Our environment We live in an era of amazing medical innovation, driven by better understanding of the genetic and biological roots of disease, and surging use of data analytics and digital technology in science and healthcare. At the same time, the world’s population continues to grow and people are living longer, fueling a rise in chronic diseases. Together, these factors are increasing demand for high-quality care worldwide and pressuring healthcare systems to restrain spending growth. ACCELERATING INNOVATION AGING POPULATION HEALTHCARE SPENDING 49 % 1.4 bn 5.4 % The rise in the average yearly number of The projected number of people in The expected annual average growth new drugs approved in the US from the world aged 60 or older by 2030, in healthcare spending between 2018 2014-2018, compared to 2009-2013 an increase of 46% from 2015 and 2022 Our strategy Our strategy is to build a leading, focused medicines company powered by advanced therapy platforms and data science.
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