Tuesday, Jul 10, 2001

FDA Issues Complete Response Letter for Xolair (Omalizumab)

South San Francisco, Calif. and Basel, Switzerland -- July 10, 2001 --

Genentech, Inc. and Novartis AG today announced that they received a Complete Response letter from the US Food and Drug Administration (FDA) for their Biologics License Application (BLA) for Xolair™ (Omalizumab), which was filed on June 6, 2000. The letter requests additional preclinical and clinical data analyses, as well as pharmacokinetic information. With the requirement of additional data, there will not be an FDA approval of Xolair in 2001. Issuance of the FDA Complete Response Letter satisfies the agency's product review performance goals specified under the Prescription Drug User Fee Act. No specific deadline has been set for the re-submission. Once filed, the FDA has up to six months to review and act upon additional data.

The companies believe they can provide substantial information from ongoing trials, including the ALTO trial, a randomized, controlled open label study to evaluate the safety of Xolair in moderate to severe asthma patients already treated with other therapies, as well as from completed trials where information has not yet been submitted. Pending continuing discussions with the FDA, some additional trials on specific subgroups may be necessary. It is anticipated that the initial proposed label claim will likely be for adult allergic asthma. The FDA also asked for information to confirm that the pharmacokinetics of the Xolair drug substance were consistent throughout the development program.

The companies are considering different scenarios with a conservative estimate being resubmissions ranging from 2002 to early 2003. The exact timing will be dependent on the scope of the discussions with the FDA. The new data which will be submitted to the FDA and also to the European Medical Evaluations Agency (EMEA) will result in a delay in the EU approval too.

Susan D. Hellmann, MD, MPH, executive vice president, Development and Product Operations, and chief medical officer for Genentech, commented, "Our top priority is to provide this information to the agency in as expedited a timeframe as is feasible."

"According to the WHO, 150 million people around the world suffer from asthma. Clearly, there is a great unmet clinical need for an effective treatment," said Jorg Reinhardt, Head of Development, Novartis Pharma. "Novartis and Genentech will continue to work together to make Xolair available to patients as soon as possible."

Xolair is a monoclonal antibody to IgE in development by Novartis Pharma AG, Genentech Inc and Tanox Inc. It is the first agent to specifically target IgE. By binding to IgE antibodies, Xolair prevents IgE from attaching to mast cells. Without IgE bound to mast cells, the presence of allergen will not cause the release of chemical mediators like histamine and leukotrienes, which lead to the symptoms and inflammation of asthma and allergic rhinitis. In trials to date, Xolair has been administered as a subcutaneous (under the skin) injection every two to four weeks, at a dose depending on patients' body weight and IgE levels. Xolair would be the first biologic available for the treatment of asthma and seasonal allergic rhinitis.

The foregoing release contains forward-looking statements that can be identified by terminology such as "will depend," "anticipated," "believe," "pending continuing discussions," "intend," "will result" or similar expressions. Such forward looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any future results, performance or achievements expressed or implied by such statements. There are no guarantees that the aforementioned actions will result in the commercialization of Xolair in any market. Any such commercialization can be affected by, among other things, uncertainties relating to product development, regulatory actions or delays or government regulation generally, the ability to obtain or maintain patent or other proprietary intellectual property protection and competition in general. Some of those factors are discussed in the Form 20-F filed by Novartis with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated or expected.

About Novartis

Novartis (NYSE: NVS) is a world leader in healthcare with core businesses in pharmaceuticals, consumer health, generics, eye-care, and animal health. In 2000, the Group's ongoing businesses achieved sales of CHF 29.1 billion (USD 17.2 billion) and a net income of CHF 6.5 billion (USD 3.9 billion). The Group invested approximately CHF 4.0 billion (USD 2.4 billion) in R&D. Headquartered in Basel, Switzerland, Novartis employs about 69,000 people and operates in over 140 countries around the world. For further information please consult http://www.novartis.com.

About Genentech

Genentech, Inc. is a leading biotechnology company that discovers, develops, manufactures, and markets human pharmaceuticals for significant unmet medical needs. Fourteen of the currently approved biotechnology products stem from Genentech science. Genentech markets nine biotechnology products directly in the United States. The company has headquarters in South San Francisco, California, and is traded on the New York Stock Exchange under the symbol DNA.

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